Tied Up Tax Revenue

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FORTY FORT -- More than 90 communities and some school districts in our area did not get millions of dollars of local income tax money they were expecting.

Officials said it's all because the company responsible for handling the money, Centax, did not update records.

Now, some municipalities can't pay their bills.

In Luzerne County alone, officials said 91 municipalities and school district are owed at least a combined total of $10 million in tax revenue. The problem is, officials said the money is tied up within Centax, and bills aren`t being paid.

One of the boroughs feeling the financial crunch of the delayed tax payments is Forty Fort. By this time, the borough should have received hundreds of thousands of dollars from earned income tax revenue from people who live in the borough and pay their taxes.

However, that money hasn`t come. Borough officials said Centax failed to upgrade its records which means the money hasn`t been distributed back to the communities.

“People in this area are being taken out of their paychecks, their earned income tax, and for them to not get their money distributed to their boroughs or townships or school districts in a timely matter, it`s very hurtful,” said John Bolin, Chairman of Luzerne County Tax Commission. 

Some municipalities, like Forty Fort rely on that money to pay their bills. Forty Fort had to take out a loan to simply keep its employees on the payroll.

“I believe that it`s a situation now where you are probably going to lose services and you lose a policeman here, or a fireman there, and you don`t know what that`s going to cost you in the future,” said Mike Murphy of Forty Fort.

As of now, Forty Fort officials said there are no plans to layoff any of the workers, but despite taking out a $250,000 loan, they said they`re still owed about $300,000 in tax revenue from Centax.

People who live in the borough like Murphy said if a solution isn`t on the table soon, he`ll likely be the one paying for the mistakes of Centax.

“It could cost money, new loans they might have to take out. Someone has to pay for that, and generally it`s going to be in some sort of tax,” said Murphy.

Officials said Centax is in the process of being taken over by another firm, and representatives from municipalities across Luzerne County will meet at the education center at 6:30 p.m. to formally end their contract with Centax and hire a new firm. Other counties in our area have already done the same, such as Carbon, Schuylkill, and Susquehanna.

Forty Fort officials said they`re also planning legal action against Centax to cover the extra expenses now in the hands of the borough.