Pull out your checkbooks, Luzerne County property owners.
Looks as if you’ll pay more taxes next year to keep county government running, and keep your home or business off the dreaded back-taxes list. The county manager’s proposed 2014 budget requests an 8 percent tax increase, though plenty of factors could lower that figure before final passage of a spending plan sometime in December.
Should you be concerned?
Yes, if you think the tax increase — of about $42.56 more per year on a property assessed at $100,000 — will pose a burden on your standard of living. Or if you believe the manager’s plan was drafted wantonly or without sufficient thought to the priorities you hold dear.
Should you take action?
Yes. Attend one or more of the upcoming public work sessions during which county council members and staffers will crunch numbers. Then voice your views to your elected leaders.
Should you pin the problem on council?
Uh, not so fast.
Remember, these 11 women and men took office not even two years ago, inheriting an untested home rule charter, a heap of problems caused by past nasty practices at the courthouse (including public corruption and nepotism), plus one other whopping obstacle: a debt of nearly a half-billion dollars.
The $466 million debt arose before home rule’s start; home rule didn’t balloon the debt. Don’t link the two. That’s a message council members, especially those seeking re-election in a few weeks, and other people hope will sink in as Luzerne County continues to contend with this gargantuan financial mess.
Of the $127 million in expenses in next year’s tentative budget, $27 million will go entirely toward debt repayment. The county’s loans are not scheduled to be fully repaid until 2027. The borrowing frenzy that led to this sorry situation occurred over many prior administrations, with current Councilman Stephen A. Urban, a former county commissioner, voting in favor of some, but not nearly all, of the debt load, much of it initially targeted for capital projects. More recently, it had been used as a tool by certain commissioners to pay for operating expenses while keeping the lid on taxes.
Today, the council members’ hands are tied. The big debt can’t be refinanced at lower borrowing rates because Luzerne County has no credit rating. It can’t even try to qualify for a favorable rating because of its dismal fiscal situation. And there are few viable options for finding money to pay down the debt ahead of schedule.
Encouragingly, the new home rule crew has acted to restore some order by, for instance, saving money by consolidating the county’s 147 bank accounts into about 30. Similarly, the county’s roster of full-time workers now stands at about 1,450, down from 1,630 at the start of 2011.
Can more be done to deal with excesses of the past? It must.
But blaming this council for debt costs is like learning an arsonist burned down your neighbor’s house on Friday night, then complaining to the neighbor Saturday morning that your yard is full of wind-blown ashes.
An effective cleanup requires careful planning, plenty of effort and time. At this point in Luzerne County’s debt recovery process, the embers are still smoldering.