Sharon workers to pay more wage taxes in ’09

Council postponed a vote on a contract with firefighters.

STAFF REPORT

SHARON, Pa. — Retired residents and businesses with property in the city are going to see a tax break, but people who work here will pay more wage taxes.

City council unanimously approved a wage tax increase from 1 percent to 2.25 percent Monday.

At the same time, it approved a 2009 budget that includes a reduction in property taxes from 39.5 mills to 21.5 mills.

Before council voted, some residents spoke against the new tax, saying it was too high:

U“I suggest you seriously think about a half-percent increase or even less,” said Noel Moss.

U“Think about our young people with that tax,” said Ann Lepak. “Do we want to burden our young people with this?”

UEd Palanski said the issue to him isn’t how the tax impacts one group or the other. It’s what happens to the revenue of the city.

“What do you project the taxable income to be in 2009? No one knows,” he said.

He said that employers are reducing work weeks to 40 hours or less, people are being laid off and there will be less overtime and less part-time work.

“Less people are working,” he said, recommending that council delay acting on the increase for 30 to 60 days to study it more.

“No one has a crystal ball,” responded Mayor Bob Lucas, also saying that council could back off on the increase at the end of the year.

Council had to OK the wage tax increase before it could approve the budget, because the increase offsets the budget’s millage reduction.

“If we don’t have a budget, then the city can’t get a tax-anticipation note, and we need that to pay bills,” he told Palanski. “We’d go belly up by the end of the month.”

The wage tax increase takes effect right away.

In other business, council tabled a vote on a four-year contract for firefighters, saying there are language issues to resolve.

Resident Sam Messina said a four-year rather than a two-year contract is unreasonable in tough economic times.

The contract calls for raises of 3.75 percent in the second and fourth years.

It also includes health insurance co-pays of $32.50 out of each paycheck for the first year, $40 from each pay in the second and third years, and 10 percent of the annual premium in the fourth year.

Firefighters have a step-raise program and make an average of $40,000 a year.

Sharon is moving toward home-rule and a city-manager form of government this year. Messina said a four-year contract will “hamstring” the new manager.

Lucas denied that there was any attempt to do so.

“We’re trying to get a fair and equitable agreement with the firefighters,” he said.