City council appears ready to take a purposeful step toward life after Act 47.
It has scheduled a special meeting for 9 a.m. Tuesday to authorize the city clerk to submit to the county elections board a ballot referendum question to establish a government study commission that would examine the advisability of a home rule charter.
In the city’s efforts to shed the distressed city label it has borne since 2007, this is a necessary step. We hope voters will see it the same way.
The city loses its ability to levy Act 47 taxes (0.4 percent on residents and a 0.3 percent on commuters) by the end of 2022.
To replace the funding, the city’s Act 47 coordinators suggest New Castle adopt a home rule form of government. The move, among other things, allows the city to institute its own earned income tax targeted at residents.
Now, as we’ve mentioned before, likely no one would get excited about voting for something that is going to take money from their paycheck. However, the alternative suggested by the coordinators is a 35 percent real estate tax increase over three-year period. Rates would jump from 14.226 (2019) to 19.226 (2022).
A switch to a home rule charter is just one of the steps recommended to avoid a $3.3 million deficit by 2024 that accompanies a negative $6.5 million fund balance.
Failure to act could lead to a fiscal emergency with the possibility of the city going into receivership.
So it’s a wise move by city council to seek a ballot referendum. Residents should be aware that any ballot question that might be approved would seek only to establish a study commission, and to elect a designated number of panelists to serve on it.
The commission conducts research and collects data and, should it decide to recommend home rule, it drafts a charter that, again, is presented to voters. Adoption of a home rule charter comes only through the approval of a majority voting in a referendum.
Right now, the city is seeking only voter approval to create and populate a panel to study the matter. We see no reason not to take that first step, but we would caution voters to choose panel members who have no political ax to grind nor vested interest in maintaining the status quo. An open mind is what’s called for here.
City council seems to be of that mindset in seeking the ballot referendum, and we applaud them for doing so.