NEW CASTLE —
Home rule would give the city more flexibility, allowing it to distribute the tax burden more fairly among all of New Castle’s residents, Mann said. But even under home rule, the city could not impose the wage tax on non-residents.
What it would mean is that city residents would have to bear the entire burden of higher property or wage taxes, or both.
Even if the city adopted a home rule charter, it must meet other criteria to exit Act 47, Mann said.
Under the law governing Act 47, a public hearing must be conducted and then the secretary of the department of community and economic development may issue a decision that the conditions that led to the earlier determination for financial distress “are no longer applicable.”
Factors the secretary is to consider to make a determination is whether the city has eliminated all accrued deficits and retired all loans that were issued to finance all or part of the city’s deficit.
Plus, the city must show that it has operated one year with a positive fund balance, meaning spending less money than it collects without relying on the non-resident wage tax revenue, Mann said.
Nonetheless, Mann said that “without gaining the additional flexibility that home rule provides, it will be even more difficult for the city exit Act 47 oversight.”