For first time in 35 years, officials grapple with municipal budgets and reassessment
From left, borough secretary Stacie Brown meets with Councilmen Jim Faure, Wesley Silva and Jeremy Berardinelli in council chambers.
Marianna Councilmen Wesley Silva, left, and Jim Faure were among those dealing with local tax issues in the borough. The welcome sign stands beside the former Bethlehem Mine No. 58, which closed in 1988 because of an underground fire.
Marianna borough secretary Stacie Brown looks over a document known as the “tax duplicate.” She updated it by hand because of the countywide property reassessment.
MARIANNA – After the first hour of a workshop on the topic of setting millage, a smoke break was in order for borough secretary Stacie Brown and council Vice President Jeremy Berardinelli, so they headed outside on the brisk autumn morning that had begun with a coating of frost.
Berardinelli was an infant the last time local elected officials had to undertake a similar task in the wake of a countywide property reassessment.
Three Marianna council members attending the Monday morning workshop took the subject matter before them seriously, and they were doing something folks in similar positions in 66 municipalities and county government itself haven’t had to cope with in 35 years in Washington County.
“I have a lot of homework to do,” Berardinelli said. “I just want to make sure we do everything right.
“The people are up in arms about this,” he said of the Washington County property reassessment. “There were a lot of people at the appeals,” including Berardinelli. “A lot of these people are destitute around here. I’m thankful our commissioners fought to the end to avoid this.”
Marianna was once considered a model town for its neat rows of yellow brick miners’ homes, so much that President Theodore Roosevelt invited mining experts to tour it. Tragedy struck not long after they departed. The meeting on the borough’s tax millage took place 108 years to the day of the Marianna Mine Disaster, which killed 154 workers. Only one person underground survived the explosion.
The community suffered another blow in the late 1980s when an underground fire led to the closure of the mine, which had produced metallurgical coal for Bethlehem Steel Co. The steelmaker filed for bankruptcy in 2001.
Not surprisingly, “the borough as a whole has lost,” Brown said of the southeastern Washington County community along Ten Mile Creek. “It’s decreased in value.” The figure provided by the Washington County Assessment Office shows the borough’s base-year taxable value of $990,606 declined from last year’s $994,306.
With her spiral-bound document known as a “tax duplicate” and a desktop calculator, Brown punched in number after number as she fielded a barrage of questions.
“Is there a chance of us losing money, or is it all going to balance out?” asked Councilman Jim Faure. Marianna’s 2016 budget, based on 30 mills, was $90,500.
Brown had been using her own home as an example, calculating that she will pay an additional $28.78 in 2017, but assessments will vary for each of the 204 households in the borough because so many factors that affect value change from house to house.
“I think the biggest thing for us to consider is so many variables,” said Councilman Wesley Silva. “We don’t want people coming and saying, ‘What are you guys doing? You’re killin’ us.'”
Monday was the first day of firearm season for hunting deer, so the public was not exactly knocking down the doors of the borough hall to attend the millage workshop.
“We have 66 less houses and half the people we had in 1981,” when Marianna was a “living town,” said Berardinelli, harking back to a time when the company town flourished.
Brown brought up the very real possibility that some residents won’t pay their taxes in a timely manner, leaving the borough in the lurch as it continues to pay for salt, for example, plus people and trucks to spread it on the borough’s hilly streets when snow arrives. There are 50 to 80 delinquent taxpayers in Marianna, Brown estimated.
Marianna had been up against a 30-mill tax limit in 2016 and prior years. Council could not increase millage under the prior assessment, Berardinelli said, without petitioning Washington County Court for approval.
A letter with a millage estimate from the Washington County Tax Revenue Office had arrived in Marianna earlier this month. It calculated down at nine places to the right of a decimal point, 0.003288391. The position of the “1” is a billionth of a dollar. The letter emphasized that the fact sheet containing the billionth was for “estimation purposes only. The purpose of this is to assist and not control or replace the good judgment of municipal officials. … To the extent that your millages may be rounded off to a shorter (number) of decimal places, or that you wish to increase your revenues within statutory tolerance, our department will be unable to assist in that regard; please seek legal counsel from your solicictor.”
Marianna officials already knew that Washington County now chooses to calculate its property assessments at 100 percent of July 1, 2015, values rather than the previous 25 percent of 1981 values. At the close of the millage workshop, those present zeroed in on a tax levy of 3.3 mills.
Under the old assessment, Marianna also had tax levies of 8 mills for street lights and 2 mills for fire protection. They reduced the numbers, tentatively, to 0.8 and 0.2, respectively.
The 2016 tax levy brought in $10,900 for illumination and $4,300 for the volunteer fire department.
Contemplating these issues had one councilman considering another avenue.
“I think consolidation would be in our best interest,” Berardinelli said. “Consolidate with the township. Sharing services would save us money. It would make sense in my personal opinion.” Marianna Borough is surrounded by West Bethlehem Township.
Marianna had 494 residents, according to the 2010 United States Census, losing 21 percent of its residents in the decade that began in 2000. West Bethlehem experienced 2 percent growth during the same period, recording 1,460 residents.
The figures Marianna officials proposed at the workshop session were tentative until they had an opportunity to discuss them with solicitor Tom Vreeland.
Washington County solicitor J. Lynn DeHaven said one local solicitor who was practicing law in 1981 when the previous assessment took effect contacted him just to make sure he and his municipal client were calculating millage correctly.
Among larger municipalities, Peters Township officials last week at a budget hearing were presented with a new millage rate of 1.522, which is expected to generate almost $4.5 million in revenue for the 2017 preliminary budget of just more than $23 million. Council wanted 2017’s tax bite to be revenue-neutral, meaning that the municipality would collect the same amount in property taxes as it would have without a property reassessment. The population of the township has grown since the census counted 21,213 residents in 2010, and with the commercial corridor along Route 19, the county valued all properties in Peters at $3.1 billion. Under the old assessment taxation formula, the municipal tax levy in Peters stood at 13.
Although the county’s chief assessor was legally required to certify the values on the tax rolls on Nov. 15, Peters Manager Paul Lauer said, “I give Brad (Boni) a whole lot of credit. The county went above and beyond to get to a point that they could certify the assessment.
“We calculated this on our own. The Washington County Assessment Office provided a figure, and they actually performed that calculation. They confirmed what we already knew. His calculation, at least in our case, was very accurate and it was very helpful.
“Brad had scheduled (appeal) hearings six days a week and into the evening hours. I have personally thanked him for his efforts and the efforts of the appeals boards.”
Peters has a history of collecting at least 98.5 percent of the local property taxes due, and sometimes more than that. The big question mark looming over the taxing bodies is the ultimate effect of appeals brought to Washington County Court. When a property’s assessment is lowered, any taxes paid under the previous assessment must be refunded to the owner.
“I think it will take some time for that to be settled,” Lauer said of the appeals taken to court. Peters, collectively, will be paying a smaller share of county taxes post-assessment – 17 percent – than it had been pre-assessment – 20 percent.
“The problem with the prior assessment was that newer homes in Washington County were closer to being assessed at market value than a home assessed in 1981,” Lauer said, adding that property owners will better understand the assessment’s impact when the new millage rate is in place.
From a neighboring community, North Strabane Township, that has seen tremendous growth, Manager Frank Siffrin said of setting a new property taxation rate, “It’s more or less a mathematical calculation. You have to go through a number of derivations before you get that number. We went from 9.98 mills down to 1.02. We factored in a little bit more, anticipating some of those commercial appeals will be readjusted.”
North Strabane’s new assessed value is upward of $2 billion.
To promote transparency after a property reassessment, state law requires municipalities, counties and school districts planning to raise taxes to use a two-step process when adopting budgets. The first step sets tax millage that would maintain revenue neutrality. A second vote is required by law to demonstrate the disparity between the two levies.
“Our feeling is this,” Siffrin said. “I think we’re going to be really close. If we’re not, we’re making that adjustment going into next year.”