Radnor’s Proposed Budget Calls for 17% Real Estate Tax Increase; Phoenixville Talks of Cutting Police Force & Lower Merion Residents Collecting Signatures in Opposition of Their Tax Increase

Lower Merion’s proposed 2011 budget indicates a 14.7% real estate tax increase . . . Phoenixville is working with a 24.7% proposed increase . . . Easttown Township announced their proposed budget includes a 5.3% real estate tax increase and on Friday, Radnor Township released their 2011 operating budget which indicates a 17 percent real estate tax increase!  Radnor residents will be facing this 17 percent real estate tax increase for 2011 on the heels of 2010’s 11 percent increase.  

Radnor’s administration points to similar problems as other neighboring municipalities due to the economy and that the municipality is struggling to recover from the recession.  With revenue growth slowed, Radnor is looking at various ways to reduce operating expenditures.  Included with Radnor’s budgetary information, is a memorandum from the assistant township manager, William Martin which details some suggestions for increased revenue.  Some of these suggestions are interesting –  I wonder if  any of these revenue recommendations or expenditure reductions are suggestions that Tredyffrin should consider.  I have highlighted some of Martin’s suggestions below:  

Revenue Recommendations  

  • Sell Selected Parcels of Township-owned Land
  • Negotiate Payment in Lieu of Tax with Universities and Colleges
  • Lease Office Space in Township Building
  • Perform audit of Cable TV Franchise License and permit fees
  • Increase Youth Sports Program Field Maintenance Fee for non-resident participants to $25 per participant
  • Consider corporate naming rights for select Township assets

Expenditure Reductions Suggestions  

  • Reduce total employee expenses by 8% in 2011
  • Implement a moratorium on acquisition of land or open space
  • Reduce Township facility costs to maximize the value
  • Reduce Legal Expenses
  • Mandate within legal limits that employees use accrued vacation
  • Explore share services agreements with neighboring townships
  • Evaluate Parks and Recreation Programs that do not met expenses
  • Review status of government and public access television channels
  • Perform energy audit
  • Reduce usage of Township vehicles
  • Rely on Citizen groups instead of hiring consultants
  • Perform audit of purchases to insure sales taxes are not paid

In looking at various ways to increase charges for services in Radnor, the administration is proposing to amend the local inspection laws to include mandatory inspection of all rental units in Radnor Township (to include colleges/universities) and to increase the fee to better align it with the cost of providing these inspections (rather than having a general tax). I am imagining all kinds of problems with this mandatory inspection . . . cost of inspection and scheduling issues, privacy concerns, etc. It would appear that managing a mandatory inspection idea would not be easy.  Owning a rental property myself in Tredyffrin, I am not sure how I feel about this idea. 

Still grappling with the 24.7% proposed real estate tax increase in Phoenixville, there is some discussion about cutting two police officers from the budget to help lower the $600K+  deficit.  It is my understanding that Phoenixville is already understaffed with their current police force.  With the economic downturn and unemployment rising, it would seem that crime could also be on the increase (particularly with the holidays coming) . . . so I’m not sure that cutting back the police force is the correct approach. Apparently all departments have reduced costs by 10% and that all that is left is to look at reducing the police force. 

The recently announced proposed 12.7% proposed real estate tax increase in Lower Merion has residents rightfully upset.  To counter the proposed 2011 budget, residents are getting their voices heard through an online petition (1400+ signatures to date).  Wonder if the Lower Merion’s Commissioners are likely to give any credence to the petition?  http://www.petitiononline.com/lmcrb11/petition.html 

To:  The Commissions of Lower Merion Township 

Petition – 2011 Lower Merion Township Proposed Budget 

Economic indicators demonstrate that our Country is still struggling to recover from recession. 

Since 2002, Lower Merion Township has raised the real estate tax millage rate by a total of 44.3% and has doubled its indebtedness (from $56 million to $112 million). 

Lower Merion Township has raised the real estate tax millage rate in seven (7) of the last eight (8) years. 

In 2010, Lower Merion Township raised trash collection fees between 10% – 41% for most residents. 

Now, the Township Manager of Lower Merion Township has proposed a 12.7% increase in the real estate tax millage rate for 2011 which, if passed, would mean a cumulative increase of 62.6% since 2002, the year in which the current Township Manager was appointed. 

The Lower Merion Township Manager proposes to increase 2011 spending by 5.5% over 2010 spending, which adds to past additional spending and represents a cumulative increase in spending of 45% since 2002. 

By contrast, since 2002, inflation has increased 20.44% (through September 30), and overall national wages have grown just 22% (through 2009). 

Further, the Township Manager has targeted a 17% General Fund Reserve Balance. The Township’s reserve policy has a goal of maintaining the General Fund Reserve Balance in the range of 15% – 18% of the Township’s prior year general fund expenditures. 

While it is the Township Manager’s role to propose a budget each year, it is the responsibility of elected Township Commissioners to determine the amount of spending to authorize and to approve a final budget. 

We believe that a 12.7% real estate tax increase is an unaffordable, unsustainable and unacceptable outcome and implore the Township Commissioners to significantly reduce proposed 2011 general fund expenditures, to draw down the General Fund Reserve Balance to 15%, and to avoid much or all of the proposed real estate tax increase at this difficult economic time. 

Sincerely, 

The Undersigned 

 

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  1. The tax hikes in Lower Merion and Radnor and soon other townships on the Mainline is all part of sustainable development/UN AGENDA 21/ICLEI i.e. the New World Order. It must all be stopped. One major goal of these “initiatives” are to make living in the suburbs so expensive and so overly regulated that people will slowly lose their homes or leave them and the govt will corral us into “sustainable inner city living communities”. States are mandated to return 50 % of the land back to govt to be where it will be deemed “Heritage” lands unaccessible to humans. Radnor Township and Lower Merion have been turned ICLEI approved communities. The residents haven’t seen anything yet. Some excellent resources include:

    http://americanpolicy.org/property-rights/sustainable-development-the-root-of-all-our-problems-2.html

    http://americanpolicy.org/property-rights/american-policy-center-mobilizes-against-more-heritage-areas-as-further-threat-to-property-rights.html

    http://americanpolicy.org/education/new-civics-means-global-governance.html

    Please people educate yourselves – The Global Warming hoax was a set up for initiating UN agenda 21. The illegal immigration fiasco will continue – part of the UN Agenda is to remove sovereignty of nations and eliminate borders.
    UN Agenda/New World Order, socialist: buzzwords include: sustainable, environmental, global, private-govt partnerships, green, communitarian, earth, and many more – learn them. Go to your local township meetings. Ask if any of your supervisors have accepted money or have had any partnerships with ICLEI. Ask if they support UN Agenda 21 initiatives. HOLD THEM ACCOUNTABLE and expose them.
    GOD bless us all

  2. But what is more scary is the huge number of doops that actually believe this, as they do the polar bear population is declining. I guess if you say something enough, or teach it in classrooms, or promote it in government, it must be true.

    Wonder if Algore is involved in this… this is a very dangerous man.. even if he never becomes President.

    1. Now do your homework Roboto. You have no idea what’s coming and the powers that be are praying you continue drinking your koolaid

      1. Kool-Aid, hee, hee.

        The Top 10 signs that you may be a Conspiracy Nut:

        (10) You believe that fluoridation in the water is a Communist plot.

        (9) You believe that a UFO crashed at Roswell and that frozen alien bodies are being kept at Area 51.

        (8) You believe that the Mafia, the CIA, the Rotary Club or anyone other than Lee Harvey Oswald was behind JFK’s assisnation.

        (7) You believe the British Royal Family had Princess Dianna murdered.

        (6) You believe that “SOYLENT GREEN IS PEOPLE, PEOPLE!!!”

        (5) You think that Glenn Beck may be onto something rather than just on something.

        (4) You think that the AIDS epidemic and the Federal response to Hurricane Katrina were Whitey’s attempt to keep the black man down.

        (3) You believe that FEMA is operating secret concentration camps and that 911 was an inside job.

        (2) You think that President Obama was born in Kenya or is a secret Muslim.

        AND THE NUMBER 1 SIGN THAT YOU MAY BE A CONSPIRACY NUT:

        (1) You believe that the United Nations (that International Body known for being paralyzed by inaction and incompetence, and whose Peacekeepers are so timid that couldn’t protect so much as a school crosswalk in Bosnia) somehow has the wherewithal and organizational skill to conspire to even tie their collective shoelaces.

        Barbara, I am sorry if I come across as being mean. I envy you in a way, however, because the Universe that you live is certainly a lot more exciting than the drab, mundane, everyday world that I inhabit.

        1. Here ya go Roboto.

          http://www.un.org/esa/dsd/agenda21/res_agenda21_00.shtml

          I don’t think you’re mean, just not informed – I would have responded the same way if you told me about this 5 years ago. Go to the source, read it all for yourself, and then come back and say “ooops, sorry”. I’m sorry your world is drab. The UN site on Agenda 21 will get your blood moving. Have a great holiday!

        2. #10 – Everybody KNOWS this is true. Didn’t you ever see “Dr. Strangelove?” Gen. Jack Ripper was right! Commies corrupting our precious bodily fluids!

          #9 – Nope. As I pointed out elsewhere on this blog, the UFO bodies are actually kept in a secret bunker below T/E Middle School by the evil school board, for sinister purposes which can only be guessed . . . .

          #8 – Ditto, school board again . . .

          #7 – No opinion on this one – it COULD have been the school board, but I can’t say for sure . . .

          #6 – Last movie for great actor Edward G. Robinson, and one of the worst movies ever made. What a crummy ending to a great career! Charlton Heston was terrible.

          #5 – sometimes Glen Beck says really stupid things, sometimes he makes a lot of sense, but he’s ALWAYS annoying.

          #4 – Well . . . don’t forget the really horrible things that actually DID happen to African Americans, like that case where they deliberately gave them VD and did not tell them so they could conduct a “scientific” study. I sort of understand why some might tend to believe the worst, given some of the history.

          #3 – Legitmate blame goes to the state, and federal goverment on this one – lousy response, lousy prevention, lousy, lousy lousy, but no concentration camps or racisim, just poor planning and preparation.

          #2 – I think it’s great that we have the first black president. Now, if I could only agree with ANY of his policies . . . .

          #1 – The UN planning some global takeover? Come on! This is the body that responded to genocide in Africa with a laconic “No, stop, don’t . . . ” (like Willie Wonka telling that fat girl not to eat the blueberries). They couldn’t figure out how to escape from the inside of a wet paper bag!

  3. Well, I’m not too sure about the global conspiracy, but I do know that Tredyffrin is in much better shape than our neighbors, thanks to early action in addressing the questions Radnor suggests, and more. I think we should credit the previous BoS for setting the right tone, and particularly the administration for actually figuring out how to deliver an acceptable level of service with fewer resources.

  4. So let me get this straight. There is a worldwide conspiracy to cheat main line homeowners out of their property. And not only is there a conspiracy….it is a UN conspiracy!!!

    I reviewed your sources. All of them are opinion pieces from the same website…one of them is from 2003….and none of them have factual information in them to back up the author’s opinions.

    Baseless hysteria over the “Red Scare” in the 1950s ruined the lives of many US citizens. I hope that we are not falling into the same trap here – demonizing scientists who dare to publish factual studies that the earth is warming, then calling them names like socialists.

    1. Go on the UN website and start reading the agenda, Research ICLEI – find whatever sources you wish. I have reams fo resources. The info is out there. As for the scientific studies, they have been debunked – again – do your own research, that info too, is out there.

      Rather than criticize my sources – go find your own – there is much out there if you want to find the info. I wish and pray I am wrong – this is very overwhelming info

  5. I agree with Ray.

    Whether one agreed or disagreed with the actions taken by the Tredyffrin BoS in 2009, it is pretty clear by looking at nearby communities how ahead of the curve they were — and how their actions have helped keep Tredyffrin in pretty good financial shape considering the pressures of the slow economy. It even seems that some of the cuts they made which were decried as draconian were quite reasonable when compared to what neighboring municipalities now face. This is even more so when one considers that this year’s budget proposal restores the most controversial decrease in funding (to fire companies) and still holds the line on taxes.

    I hope that the BoS remembers how efficient they were able to be in a poor economy so they don’t go overspending when the economy turns. That would be most helpful to residents.

  6. Before this thread gets totally hijacked, there are some Community Matters to talk about. Like Radnor’s “fire and library tax” proposal quoted in the Main line Media article http://mainlinemedianews.com/articles/2010/11/23/main_line_suburban_life/news/doc4ce84b5f21657507668410.txt?viewmode=fullstory:

    “The budget also proposes new millage to be put in place earmarked for library (.27 mills) and fire services (.15 mills).

    The intention is to create these millages for a two-year period during which time each entity would propose a permanent funding plan to the voters of the township, according to the report.

    According to the budget crafters, the plan would keep the two programs funded and then would put the question of their support level to voters, so “township stakeholders can feel confident that these are programs/services supported by the majority of the community,” the summary reads.”

    Doesn’t Tredyffrin have a group working on emergency services funding? What are they up to? How does this relate? Is it a good idea? I’d like to see everyone bear a fair share of emergency services costs.

    Add Chester County to the list of likely tax increases, too – maybe .14 mills.

    1. O.K. Back on topic.

      Radnor facing a 17% tax increase.

      Phoenixville facing a 25% tax increase.

      Lower Merion and T/E School District facing tax increases.

      Tredyffrin Township. . .facing no tax increase whatsoever!

      Thank you Warren Kampf, Paul Olson, Bob Lamina and the others on the Tredyffrin Township Board of Supervisors for the excellent stewardship and fiscal prudence you have all exhibited.

      1. That’s fair. Credit where credit is due. Tredyffrin has the situation under better control than some other nearby communities.

        I would point out that school districts struggle with some issues which do not confront townships, of which, the PSERS crisis is a notable example.

        Also worth noting is that the T/E school district has had, and still has, some of the lowest school property taxes in the state, in recent years consistently ranking somewhere in the 470’s out of 501 districts.

      2. Just so we don’t get too carried away: Tredyffrin did have a 25% increase in the sewer fee/tax last year, and T/E’s low ranking tax percentage is multiplied by its high ranking assessed value.

        1. And so that we don’t get too overwhelmed or encouraged or discouraged by percentages….we ought to talk about real numbers….talking about a 25% increase on a $200 assessment sounds much worse than it is. Likewise, a 3% increase is made to sound bad, but on an average home, it might be less than $100. Ray — you and I have talked about our assessment values before and agreed we have differing conclusions, but our taxes in real dollars continue to be quite low relating to other communities.

          I include here the data based on the 2009 tax rates…I’m not going to calculate it again to make the point, so if someone has dramatically changed, I apologize.

          Premise is the purchase of a $500,000 house — the assessment is based on the CLR (calculated annually)
          Given the CLR (see previous posting), this $500,000 house would assess as follows:
          54.0 Montgomery County $270,000
          53.0 Chester County $265,000
          61.3 Delaware County $306,500
          9.7 Bucks County $48,500

          Using the property tax millage for school districts with these assessed values on our $500,000 purchase house, your property-based school taxes would be as follows:
          T-E $4,629.55
          Great Valley $4,828.30
          Radnor $5,979.82
          Lower Merion $5,786.24
          West Chester $4,730.25 plus .5 earned income tax
          Unionville- CF $6,248.70
          Central Bucks $5,567.80 plus .5 earned income tax
          Council Rock $5,236.06 plus .5 earned income tax
          Upper Merion $4,114.80
          So — homeowners — this is how people decide to move here. What to you think influences the choice?

        2. True, but the relative tax burden is still a valid comparison. Compared to other districts, including our immediate neighbors, T/E is a “relatively” lower burden. That is a valid point. In other districts the burden is worse. Taxes are often much higher for houses which are worth much less. You pay more while you live there and your kids don’t get (in some cases) as high quality education as in T/E, AND when you sell your house you don’t get as much for it – you don’t get your investment back. Not good at all.

          The statistic comes from the PA Dept. of Education and is based on the school tax as a percentage of home value. So it does compare apples to apples, so to speak. As a percentage of the home value, T/E ranks among the lowest.

          However, in real terms taxes have gone up. The percentage remains low since property values have also gone up, as fast or faster than the tax increases. This is little comfort to a senior on a fixed income who pays the property tax each year and is not able to tap the home’s equity for living expenses (we’ll ignore “reverse mortages” for the moment, they too have costs).

          On the other hand, high property values eventually are a HUGE benfit and do represent return on the investment of school taxes. The equity is what many seniors rely on when they sell their houses and “downsize” or retire. The equity also helps younger folks change careers, start businesses, pay for college tuition, provide medical care for elderly parents, respond to emergencies like extraordinary medical expenses, etc.

          It is a complicated picture, and not all bad. But I will certainly acknowledge that we seem to be entering a new era, where the local community’s ability to endure – and tolerance for – increasing taxes are coming to an end. Something has to give. I still say the real answer is cost control and we need help from Harrisburg to do that.

  7. Kevin, that PSER crisis was born from the legislators in Harrisburg. So that is where the problem will be solved.
    Will the new regime in Harrisburg change it? Will they have the courage to do so? Clearly this is a pox on local school boards and communities. Seems to me pressure needs to be brought to Harrisburg. Another example of the law of unintended consequences, or is it?
    Thanks for your astute clarity on these and other issues

    1. Thanks. I think it is largely a problem that needs to be addressed in Harrisburg, and I hope people will pressure the legislature to do something about it.

  8. First, Kevin, I have to comment on a couple of your assertions:

    “The [tax] percentage remains low since property values have also gone up, as fast or faster than the tax increases.”

    In the last decade, school taxes are up 50%, while house prices in my neighborhood are flat (although there have been no recent sales to test Zillow estimates).

    “On the other hand, high property values eventually are a HUGE benfit and do represent return on the investment of school taxes. The equity is what many seniors rely on when they sell their houses and “downsize” or retire. The equity also helps younger folks …..”

    I don’t know of any causation between higher property taxes (increases) and a higher rate of increase of house prices. However, mortgage payments are indeed a form of (inefficient) savings that returns the home equity at the end of the loan. I think we can not assume inevitable house price increases in any market.

    Second, on to how Harrisburg can address PSERS funding. HB2497 has the biggest impact by deferring the big increase in employer contributions from the previous 2013 to a stepped increase by 2018. But pension burden on employers over the next two decades from 2016 is still four times the current rate, and the 8% annual growth rate assumption will still have to be dealt with.

    Some solutions (singly or in combination):
    1. Defer yet more? But the fund will eventually run out of money as the pension are paid.
    2. Change the pension plan? Seemingly non-constitutional.
    3. Implement statewide tax increases (sales tax?) perhaps in the form of changing the basis for school funding from local to state? A way to disguise the impact, but hardly going to be popular.
    4. Continued increase in local taxes, property and income? Perhaps more amenable as the economy improves later this decade.
    5. School districts curtail increases in current compensation (wages and benefits) in favor of future pension payments? Helps the eventual liability, too, but continues to penalize new hires.
    6. School district bankruptcies and debt restructuring? Radical, but one stakeholder class that has been pretty immune so far is bondholders. (See Ireland)

    Harrisburg can act on 1,2 and 3, but is it likely? What other tricks do readers here have up their sleeves?

    1. I don’t have the statistics in front of me, but you can probably get them from the school district easily. Not long ago, it was demonstrated that as a percentge of home value, T/E school taxes have remained stable and the percentage is about the same as it has always been. Just roughly, look at Andrea’s example (above) where a $500,000 house in T/E pays $4629 in school taxes. Round that to $5000 and it is 1% of the home value. You can go back historically and it is about the same all along. We’re talking long-term, not a snapshot of the last few years. I don’t know what future trends will bring, but there is definetly a correlation between school quality and value of your home and return on your real estate investment.

      It is still true that quality of the school district affects the resale value of the home – it is obvious from the relative property values in nearby districts as compared to T/E, where similar houses are worth less in other school districts.

      1. It’s such a hard case to make Kevin because taxes seem to continue to rise….and property values haven’t…but in fact they have because it’s about the total assessed value in the community. While Ray hasn’t seen increases in prices, the overall tax base has grown due to the “new” construction — which powers up the base momentarily. It’s the pull back in the last 3 years that has so badly affected the balance. In fact, it’s the complaint I have with the planning of the current TESD board and administration — the CLR (figured annually) was predictive of the assessment appeals….and it’s the reduciton in the value of assessments in this community that has triggered much of the “inbalance.” But using last year’s numbers, the 1% was and still is true. As the assessments continue to decline (should slow down now that the CLR has reversed), the growth presumably will slow down.
        Maybe the freeze on Federal Employee pay (1.4% COLA wasn’t exactly a windfall) which Obama has proposed will send a message to teachers and other negotiated payrolls.
        Has Radnor settled yet?

        1. Good points. I have said all along (as you also have) that business as usual seems to be a thing of the past and something has to give. It really is largely about public employee unions and their benefits – the tide of red ink facing many states and communities, to say nothing of school districts – has a lot to do with union benefits that were at least sustainable during good economic times and are out of line now.

          Assessments and transfer tax revenues will fluctuate and recover when the economy gets better, but I think the issues (such as PSERS) will have to be dealt with first, because it seems unlikely that the economy will improve any time soon. I think the legislature will have some real tough choices ahead of it in the next couple of years. I think it will be nasty because the union leadership does not want to get the message. Not sure that’s true of the rank-and-file.

          I certainly do respect and support our teachers – many of whom are excellent – and I beleive they should be well compensated. But they do have some benefits the rest of us have not had in many years, and I think they will have to get more realistic in the future – the economy will take time to recover, we have Act 1 taxation caps, and the taxpayers may no longer be willing to absorb increases each and every year even if they continue to fall within 1% of the property value.

          That brings me to another thing I would like to emphasise (again – this is in one of my comments above) the property tax is a real problem for seniors on fixed incomes, and the fact that it has remained relatively stable as a percentage of home value is not very helpful to them until they sell their home.

          Thanks again for your perspective. Oh, I haven’t heard any news about Radnor yet.

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