New Taxes Proposed in Scranton

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Scranton Mayor Chris Doherty has laid out his tax plan over the next three years.

He is proposing hikes in property and garbage taxes that will help pay for loans the city is spending now.

Mayor Doherty said this new tax plan is a worst-case scenario, but one he had to come up with to ensure the banks give the city of Scranton a loan it needs now to pay salaries and benefits for city employees.

Doherty said just like any person looking to take out a loan, the city of Scranton has to prove it will keep up with its payments. In order to secure a $16 million loan for this year, Mayor Doherty and city council need a plan for how they will make that money back.

"In this environment, banks are very strict, and if you depend on them for your loans you have to play by their rules and make sure you have a true document before them," Mayor Doherty said.

This the revenue raising plan the mayor wants to show to the banks. First, some tax hikes for property owners in the city, a 29 percent increase next year, another 20 percent hike in 2014 and then another 15 percent in 2015.

Garbage taxes would go up $11 a year. Scranton residents pay $178 a year now. It would be $200 by 2014.

The mayor also wants to impose a commuter tax for people who come in to the city to work. The tax would raise $1.5 million next year and $3.5 million in 2014.

"Now that only lasts for three years and has to be approved annually by local judges. This is a worst case scenario, we do think it's going to improve," Doherty added.

The tax plan still needs approval from city council and the banks and it needs to be approved within the next few weeks. Many city residents Newswatch 16 spoke to weren't happy to hear their taxes may be going up in order to pay for this year's bills.

"They're sticking a lot of delinquent notices on doors now because somebody dropped the ball in the city, so this is a not a good way to recuperate money at the expense of hard-working people," said Reginald Clark of Scranton.

Newswatch 16 was not able to reach any members of city council for comment, but the mayor said council members can make changes to his plan. The plan needs bank approval very soon, as that $16 million loan is budgeted to pay bills for the next four months.