For the first time in 12 years, Lower Macungie property owners will be paying a township real estate tax.
On Thursday night, township commissioners voted 3-2 for a 2014 budget that includes the .33-mill property tax.
Commissioners Douglas Brown, Ron Eichenberg and James Lancsek voted for the tax, while Ryan Conrad and Roger C. Reis voted against it.
“We’re not asking for thousands of dollars from residents, we’re not asking for hundreds of dollars from residents,” said township manager Bruce Fosselman. “In most cases, it will be anywhere from $33 to $99 a year.”
The average value of homes in Lower Macungie is $280,000, according to Fosselman, who said owners of such properties will pay a $92 township real estate tax next year.
Those supporting the tax stressed that large retail, commercial and industrial properties also have been paying no real estate tax to the township.
“Commercial and industrial users have had a free lunch for 12 years, paying zero,” said Lancsek. “A lot of people don’t know that.”
Fosselman and Eichenberg said those large property owners include Wal-Mart, Mack Trucks, Buckeye Pipeline, developer David Jaindl, the Cedar Shopping Center where Bon-Ton and Giant are located, as well other large industrial, commercial and retail property owners.
“Is it fair that they are paying zero tax?” asked Eichenberg, president of the five commissioners.
He said more such large properties are coming, including the Hamilton Crossings shopping center and “multiple one-million-plus-square-feet warehouses” in Jaindl’s recently-approved Spring Creek subdivision.
“I’ve been a proponent of this budget, and the accompanying one-third mill tax, since day one,” said Eichenberg. “It is our civic responsibility to support the services our municipality provides. The taxes we are paying are an investment back into our community. They are an investment into our quality of life.”
Fosselman said that tax will generate about $1 million, which will be used strictly for capital projects. He named just a few of the many capital needs for 2014, including replacing a 1989 Mack dump truck, which has over 117,000 miles. “The frame rails have started to rust away, the body is shot and the hydraulic system needs to be replaced.”
Stressing the increased need for township services, Fosselman said in 2002, when the township eliminated the property tax, Lower Macungie had 19,200 residents.
“The latest projection is that we’ll have 31,500 people as of Jan. 1. We’ve had unprecedented growth over the last 12 years,” he added.
Fosselman, who lives in the township, stressed the goal is to maintain the quality of life Lower Macungie residents “expect and deserve.”
The township manager said for several years Lower Macungie has been drawing down its cash reserves, money needed for major emergencies, to help pay for capital improvements. He said the township will enter 2014 with $4.2 million in reserves, less than half as much as it had five years ago. “We can’t keep using reserves because we’ll have no reserves left.”
While Eichenberg and Lancsek expressed their support for the tax at previous meetings, Brown seemed more tentative in his early support.
Before expressing his own position, Brown asked commissioners-elect Brian Higgins and Ron Beitler to share their opinions on the property tax.
Higgins spoke first.
“For far too long, as citizens of this township, we have enjoyed the many blessings of living here without paying for any of them,” said Higgins. “We’ve had a free ride.”
He continued: “If I were on this board of commissioners right now, I would vote to approve this budget. To be perfectly honest with you, I would vote to approve this budget at a higher tax rate, because we’ve already cut out so many capital projects that I’ve seen cut year after year after year.”
Reis got the best laugh of the night when he said he appreciated Higgins’ honesty for saying he didn’t think the tax was high enough, and then told Higgins: “I wish you had put that in your campaign literature.”
Next month, Higgins and Beitler will replace Eichenberg and Reis, who were not re-elected in November.
Beitler was less direct in his response to Brown. “I do agree with the manager on the fundamental underlying problem,” he said. “We can’t keep operating the same way we have been.” He also said he agreed with “elements” of what Higgins. “We have a problem on the table that we need to deal with tonight.”