SCRANTON — Scranton is one step closer to imposing a commuter tax on non-residents who work in the city.
City council approved the first reading of the ordinance with a vote of two to one at its meeting Thursday night.
“The ayes have it, so approved,” said council vice president Pat Rogan.
With a vote of two to one, Scranton City Council approved the first reading of the commuter tax, which now introduces the ordinance for discussion.
Council believes the commuter tax, that would be applied to non-residents who work in the city, would generate about $5 million a year.
Those commuters expressed anger at what they called taxation without representation.
“It is basically imposing a tax without our consent. As a non-resident of the city of Scranton we have no vote and we have no voice,” said one man who commutes from Dunmore.
This tax would be applied under Act 205 that allows municipalities to tax non-residents with the revenue going only to pay for distressed pension funds.
A financial advisor told council the pensions are one of the biggest financial burdens Scranton has.
“I do stress the results of Hazleton, it has been a distressed city even longer than Scranton with regard to their city pension,” said Wilkes-Barre commuter Matthew Ford. “They`ve had the commuter tax in effect for 30 years now it has not made a difference, they`re still in a distressed situation.”
“Today we`re talking about a commuter tax because we have inability to fund our pension because we mismanaged the funds, we`re responsible for that,” said Scranton resident Doug Miller.
For the average commuter making $50,000 a year, this tax would be an extra $ 375 dollars.
But there’s a twist.
Council member Bill Gaughan says city residents could also be affected if the commuter tax is applied.
He says state lawmakers are considering amending Act 47, the Distressed City Legislation.
That amendment would force a municipality to raise the city wage tax if a commuter tax is imposed.
“We could end up with some egg on our face and it`s again if we have to raise the wage tax, it`s completely debilitating for residents,” said Gaughan.
Council member Gaughan believes that Act 47 legislation could be brought to a vote by this fall.
As for the commuter tax, a final vote is expected at the end of this month.