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<p>Citing rising expenses and past unrealistic revenue streams, Luzerne County Manager C. David Pedri has asked county council to raise taxes 3 percent in 2019.</p><p>The hike would increase county real estate taxes $18 on a $100,000 property, with the total tax bill rising from $597.54 to $615.47.</p><p>&#8220;The (proposed) 2019 budget is a sustainable budget,&#8221; Pedri told council during his Tuesday night presentation of the suggested $140.95 million general fund operating plan. &#8220;As manager, it is my job to seek out the best options and standing going forward.&#8221;</p><p>Council is free to alter the proposal before final adoption, which is set for Dec. 11. Several budget work sessions have been scheduled before that date.</p><p>Pedri said the hike would generate an additional $3.15 million to cover $2.5 million in increased expenses and a revenue decline.</p><p>His breakdown of the $2.5 million in rising expenses includes increases in these categories: pension subsidy, $570,000; health care, $280,000; district attorney capital cases and witnesses, $210,000; and prison health care and overtime, $400,000.</p><p>Personnel costs also are set to rise $483,000 due to union-negotiated raises and merit-based raises of up to 3 percent that Pedri is seeking for non-union workers, he said.</p><p>The requested tax hike would be higher without another proposed change in the budget involving the contingency reserve, Pedri said.</p><p>This year&#8217;s budget includes a $4.9 million contingency. This is essentially money earmarked for emergencies that cannot be touched without council authorization.</p><p>Pedri&#8217;s proposed budget reduces the contingency to $1.05 million next year so the remaining $3.9 million can help cover a debt repayment increase. Debt payments are rising by $4.26 million next year, for a new total $25.04 million.</p><p>Revenue expectations must be reduced $790,000 because several receipts have been over-aggressively budgeted for several years in probation, domestic relations and the prior-year taxes category, he noted.</p><p><strong>More arguments</strong></p><p>While the county is no longer carrying a deficit on its financial books, Pedri told council there are still fiscal challenges.</p><p>The administration plans to seek council approval next year for a borrowing/refinancing to fund a 911 emergency radio system upgrade and new voting machines with a paper trail.</p><p>Combined, the two projects have been estimated to cost up to $24 million. Pedri said he does not yet know the amount that will be needed but estimated it would likely be &#8220;eight figures,&#8221; or at least $10 million.</p><p>Pedri said he is concerned passage of an insufficient budget would negatively impact the county&#8217;s credit rating, and thus the interest rates on new borrowing.</p><p>The county received a BBB- credit rating from Standard &amp; Poor&#8217;s in August 2017, which lifted the county out of a speculative pool into an investment-grade position.</p><p>The 2017 budget was &#8220;tight&#8221; with a $180,000 surplus when one-time windfalls, such as $4 million from a baseball franchise litigation settlement, were stripped out, Pedri said. He predicted the county will end this year with a $250,000 surplus, which he further held out as evidence of a lack of budget flexibility and liquidity that could boost the credit rating.</p><p>The county still has approximately $5.8 million in the bank from this year&#8217;s unspent contingency.</p><p>Council must decide whether to use the money to build a permanent savings account, bolster the dwindling $600,000 capital projects fund or prepay next year&#8217;s budgeted expenses. Some officials have expressed past concerns about the last option because it would leave a void the following year when the cushion is no longer available.</p><p>Councilman Stephen A. Urban said property owners already are burdened with &#8220;outrageous&#8221; taxes when school and municipal ones are factored in, and he won&#8217;t support a hike. The contingency should be tapped, if necessary, to avoid a tax increase, he said.</p><p>Councilman Edward Brominski said elderly property owners on fixed incomes can&#8217;t afford to pay more, and he called for the manager to present a 3 percent tax reduction.</p><p>Councilman Harry Haas also said cuts are warranted.</p><p>&#8220;Government tends to creep and grow, and we&#8217;re trying to curtail that,&#8221; Haas said.</p><p>Citizen Brian Shiner said the county is &#8220;headed in a positive direction&#8221; but should not raise taxes.</p><p>&#8221;I don&#8217;t know whether to laugh or cry,&#8221; Shiner said of the proposal, urging officials to follow the expectation for citizens to &#8220;do more with less.&#8221;</p><style>
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<div class="neFile"><img class="neImage" src="https://www.timesleader.com/wp-content/uploads/2018/10/web1_TTL091318Pedri2-2.jpg">
<div class="neCaption">Pedri </div></div><div class="metaInfo"><photo0>https://www.timesleader.com/wp-content/uploads/2018/10/web1_TTL091318Pedri2-2.jpg</photo0><caption0>Pedri </caption0><photoCredit0></photoCredit0></div><div class="neFile"><img class="neImage" src="https://www.timesleader.com/wp-content/uploads/2018/10/web1_luzcocourthouse01-2.jpg">
<div class="neCaption">Luzerne County Courthouse </div></div><div class="metaInfo"><photo1>https://www.timesleader.com/wp-content/uploads/2018/10/web1_luzcocourthouse01-2.jpg</photo1><caption1>Luzerne County Courthouse </caption1><photoCredit1></photoCredit1></div></div>
<div class="metaInfo"><bylineMeta><p>By Jennifer Learn-Andes</p><p>jandes@www.timesleader.com</p></bylineMeta></div><div class="metaInfo"><shirttailMeta><p>Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.</p></shirttailMeta></div>

Luzerne County manager proposes 3 percent tax hike in 2019