New Castle News

Closer Look

July 6, 2013

John K. Manna: Just saying no to home rule in New Castle

NEW CASTLE — If it isn’t broken, don’t break it.

That’s essentially what a committee made up of New Castle city officials decided in exploring whether the city should pursue a home rule charter.

After studying the pros and cons of placing a question on the ballot for the last few months, the committee recommended against pursuing the idea.

Formation of the committee was a directive in the city’s Act 47 financial recovery plan. A major reason for doing so was that it would provide the city more flexibility with its taxes, and overcome one hurdle to exit Act 47 status.

Act 47 gives the city the ability to have a wage tax above the state limit of 1 percent on city residents. The tax now is at 2.15 percent and generates about $2.5 million in revenue.

If the city were no longer under Act 47, it would have to lower the tax to 1 percent and, therefore, lose the $2.5 million in revenue it desperately needs. However, the city could impose a tax above the state limit through a home rule charter that would have to be approved by the voters.

While city officials like that aspect of home rule, they believe the process has some drawbacks.

Once a government study commission would be approved by the voters, city officials would have no control over the process. Although the city’s intent may be to only consider taxes, the commission would have wide latitude to look at other aspects of the government.

In fact, a study commission would not be obligated to even consider lifting the ceiling on the wage tax.

But the commission would have the authority to recommend changing from the current mayor-council form of government to something else. And that’s a key concern for city officials.

One point worthy of note in the committee’s report of its study is that there is no sentiment in the community to pursue certain changes over others. Actually, there is no community sentiment to make any changes, including changing the form of government that has been in existence since 1968.

So, it appears New Castle will be under Act 47 status for some time to come. And what is wrong with that? Act 47 has provided the city with financial stability over the last five years, something that would not have occurred otherwise.

 

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