MERCER COUNTY Officials consider increase in taxes

The county has raised taxes 20 out of the past 30 years.
By MARY GRZEBIENIAK
VINDICATOR CORRESPONDENT
MERCER, Pa. -- Mercer County commissioners are looking at a 1.5-mill or 8.8-percent tax increase to get through 2004.
They unanimously approved the preliminary budget at their meeting Thursday, saying they will work on cutting costs further until Dec. 30, when a final budget will be adopted.
One mill brings in about $1.2 million and the average taxpayer will see taxes increase by $30 if the proposal receives final approval, said Tresa Templeton, county fiscal director.
The proposed tax increase came as no surprise because the county has raised millage 20 out of the past 30 years. Last year, the county raised taxes 2.75 mills, or 19 percent, but needed to collect only 2.5 mills of it. In 2001, the increase was 36 percent. But in 1999 and 2000, millage was actually reduced.
Why it's needed
Two main factors, hospitalization insurance and the retirement fund, are making the tax increase necessary, Templeton said.
The actual increase in health insurance in 2004 is not yet known, but Templeton is estimating 25 percent based on 30 percent and 23 percent increases in 2002 and 2003, respectively.
In addition, the county must make an $800,000 contribution to the employee retirement fund in 2004 because of stock-market losses in the recent economic downturn.
For years, the retirement fund required no county contribution because of appreciation in fund investments. Last year, however, $83,000 was needed, and this year, $800,000 more is needed to make up for the losses.
Commissioner Gene Brenneman said Mercer is actually in better shape than many counties. He said every county adjoining Mercer has had to contribute more than $1 million into its pension fund.
Also factoring in
Other factors in the increasing costs are construction of a fourth courtroom at the courthouse, and expenses involved in next year's transition to the new jail.
Even with the proposed tax increase, the general fund budget shows a $600,000 shortfall for next year. Figures show $21.9 in anticipated revenues and $22.5 in expenses.
A built-in safety factor, however, is an anticipated $2.28 million carry-over balance, which will be made possible by the proposed millage increase.
Templeton said that the state recommends that counties carry over a three-month operating fund balance. While the anticipated 2004 year-end balance falls short of that, Templeton said she is working to build it up.
When carry-over balances are not sufficient to pay expenses until taxes are collected, short-term loans must be taken.
The two commissioners who will take office in January -- Brian Beader and Michele Brooks -- are being kept informed of the budget process.
The law provides that newly elected commissioners have 15 days after being sworn in to reopen the budget.