Tax Increase; First in Ten Years

It is said that death and taxes are the only two things certain in this world. For the last ten years, Upper Merion Township had defied tax increases, even slightly reducing taxes twice. However the inevitable has now happened.

Upper Merion Township will be increasing real estate taxes for 2005 by four-tenths of a mill. A mill amounts to 10 cents for every $1,000 in assessed value. For Upper Merion residents who own a median priced home valued at $150,000, that boils down to $5 per month in increased taxes.

The new tax rate will increase overall township revenues by $1,389,232. That amount will be used as follows:

• The library, which lost significant state funding last year, and did not see that funding restored by later legislative action. Further, the library, which had previously been subsidized from the township's general fund, will now be financially independent. This amount will be $347,000.
• The township liability insurance has risen by $197,205, and worker's compensation has risen by $60,251.
• The costs of a police litigation settlement of $60,000 per year will be included in the budget for the first time.
• Finally, in 2004 the township was able to balance its budget as mandated by state law with the transfer of $700,000 from a now diminished Revenue Stabilization Fund. These funds had been set aside in previous years to counter loss of business taxes due to the Route 202 project. several slow economic years contributed to this need.

Departmental budgets have been severely paired down, with no budget request exceeding the 2.2% cost of living increase as mandated by the Board of Supervisors in their budget guidelines approved at a public meeting in September 2, 2004. The Supervisors, being cognizant of the economic conditions, approved the creation of a budget for 2005 and sought in every way to avoid a tax increase for the eleventh straight year. A draft form of the budget guidelines was presented on August 18, 2004.

There is some good news in terms of residents' paying for services, and that is the sewer increase for this coming year will be slightly smaller than projected. Last year following a cut in State of Pennsylvania funding of near $700,000, the Board of Supervisors implemented a $6 per quarter increase which represented half the money needed to close the gap. There had been some hope that the state money would be reinstated. While that did not happen, operational efficiencies have limited the second half of the increase to $5 per quarter.

The increase in real estate tax rates is consistent with maintenance of the township's valuable Triple Aaa rating from Moody's, which reduces debt service costs.

The Board of supervisors will post the 2005 budget which will include the increase on November 18, 2005. The budget will be available for public comment for 20 days and on December 9. 2005, the Board will vote to adopt the budget. The budget is voted on during a regular meeting of the Board of Supervisors which are held on Thursday beginning at 7 p.m. in Freedom Hall, Upper Merion Township Building, 175 West Valley Forge Road, King of Prussia.