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Financial Adviser Reveals Recovery Plan To Scranton Council

SCRANTON — It was a dire message to officials in the city of Scranton: act now or the financial situation will just only get worse and worse by a lot.

Wednesday night, the mayor and a financial adviser presented city council a four-year plan to get out of its monetary mess.

The city of Scranton has been a financial disaster for decades and its residents have seen property taxes on a steady and steep increase.

Now a financial adviser hired by the city says Scranton can no longer rely on property taxes alone for revenue.

For homeowner and landlord Bob Meyers, he says he`ll believe that when it happens.

“Every year it keeps going up and up and then they supposedly have a fix and another year down the road, they’re going to say, ‘You know what? We’re going to have to raise it because this problem came up,’” said Meyers.

Mayor Bill Courtright and financial adviser Henry Amoroso presented city council with a four-year plan to get the city back on its financial feet.

The biggest burdens to the budget are debt and pension payments.

The plan would ask the city’s municipal unions to reopen their contracts now to renegotiate pensions, rather than wait until 2017.

“We met with the unions today and I think it went very well and I said to Henry on the way back to City Hall, ‘better than I expected,’” said Mayor Courtright. “I think the unions understand the city’s in very dire straits and I think they’re willing to help.”

To raise revenue, Amoroso wants to add a special non-resident earned income tax that would go only to pay for pension funding as long as the pension fund was distressed.

The city should look into selling assets, specifically the parking authority and sewer authority.

The plan calls for a property tax increase over the next three years.

There would be an 18 percent increase in 2015, a 6 percent increase in 2016, and a 4 percent increase in 2017.

However the plan would do away with the business and mercantile tax, saying that tax deters new employers from moving in.

Joshua Mast, one of the owners of Posh Restaurant, agrees.

“There’s not enough business in downtown to really be competition so we just need to get as much business downtown because then we get the workers downtown, then we get more people that want to live downtown,” said Mast.

The financial adviser says the city is in desperate need of a new property value assessment, saying the last one was done in the late 1960s.

5 comments

  • Franko

    Gee — how about they do with all other business have done over the years — get rid of pensions and go to 401K so that the employees have to put money in to retire on — Even other union companies like Coke, Pepsi, Delta Airlines, US Air, etc, have all done away with pensions..
    As for business taxes — really ? You make your most money on businesses because they have a larger income than many people do, and you are getting rid of the tax ? I can see an exception for small businesses under a certain size and dollar volume, but not for bigger businesses. Can you imagine the money they would loose on mall businesses not paying taxes anymore. (not like there are many left there anyway). Getting rid of the taxes is not going to get businesses to the city — How about improving the city ? cleaning up the city ? Getting all the scum out of the city ? Tearing down condemned houses ? Condemning houses that should be condemned that people are allowed to live ion which are totally unsafe ? Do something about all the drug trafficking and crime (the stories in the news over the past 12 months makes the area sound like Wilkes-Barre more and more when it comes to crime) Do things to attract people to the city in general. And besides, any businesses that do come into the area are just going to be low paying waged companies anyway.

  • MC

    What about eliminating the defined benefit pension plan for new employees? These employees could get a 401k type plan instead. This is the only long term solution to our pension mess. The state government has these issues as well.

  • Charlie Lucky

    the mayor says the unions want to help. The mayor will tell you whatever you want to hear, and he is telling you that, so you don’t feel too bad about the 28% real estate tax increase on your homes, over the next 3 years!!!! The unions are not giving back anything, they stand by their contracts, end of story, and they should. Want to save money, PAY LESS PLOITICAL SALARIES…………. the ones that do nothing but move their lips………

  • joe

    how about the renters pay they dont pay property taxes or school taxes i have a home and no kids i know people that rent and have 4- 6 kids.keep raising the property tax ill sell my house and leave

    • marbs

      I am no fan of renters but the owner of the house they rent pays property and school taxes just as if he or she lived there and had those 4-6 kids so indirectly renters do pay property and school taxes. Hopefully 3 family and above homes that are rented are taxed at 3 times what a single family home is, if not they should be. How about a yearly rental fee for each unit that is rented that would help.

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