Erie County Council approves double-digit tax increase as part of $580 million budget

Erie County Council passed a reduced but still historic tax increase Tuesday to help balance an expansive $580 million budget for fiscal year 2024.

In a 4-3 vote, council approved the budget with a 10.9% or 0.65 mills property tax increase.

The increase, which boosts the county government millage rate from 5.96 to 6.61, means the owner of a property assessed at $100,000 will pay $65 more in taxes.

While the 10.9% is a reduction from the 14.3% increase that Erie County Executive Brenton Davis proposed in October, it’s still the highest since the county ― under the Home Rule Charter ― raised taxes by 13.4% in 1991.

A 10.9% increase would also be the county’s sixth highest under the Home Rule Charter: 17.1% in 1981 and 1982; 16.6% in 1980; 15.6% in 1983; 13.4% in 1991; and 11.8% in 1990.

In October, Davis informed council that his proposed 0.85 mills tax hike was needed to match a roughly $12.1 million increase in spending, an increase that he said was buoyed by high inflation and higher pandemic-related costs across all areas of government.

His proposed 0.85 mills increase would have meant the owner of a property assessed at $100,000 would pay $85 more in taxes, or $20 more than council’s 0.65 mills hike.

Council on Tuesday approved an array of action sheets, essentially amendments, that reduced the proposed general fund budget by roughly $1.7 million to $134,546,430.

Council balanced the budget by using roughly $3.9 million from the county fund balance to supplant tax revenues. The Davis administration says the fund balance will sit at roughly $58 million after the transaction.

Voting in favor of the budget and the tax hike were Democrats Tom Spagel and Jim Winarski and Republicans Ellen Schauerman and Charlie Bayle.

Voting against were Democrats Andre Horton and Terry Scutella and Republican Brian Shank.

Here are some key takeaways about the new budget.

Council holds back on proposed EMS authority

Council rejected the use of $2 million from the general fund to support a proposed emergency medical services authority, a goal that Davis has been pushing for several months to reduce EMS response times.

Davis believes getting all of Erie County's 38 municipalities to work together under an authority model would, among other things, provide a uniform system of funding for each EMS agency at a time when agencies are dealing with higher costs and call volumes, difficulties in attracting and retaining volunteers and paid staff, and challenges in raising enough money to support their operations.

Bayle and Schauerman said residents in their districts have voiced support for the idea and need the help.

Davis proposed to use $2 million from the Gaming Fund. However, Schauerman introduced an action sheet Tuesday to use $2 million from the general fund instead, given the reluctance of the council accountant to pull more monies from the Gaming Fund.

Horton, Scutella and Winarski insisted there wasn’t enough information about the proposed authority to warrant a general fund expenditure.

“I think that’s a bridge too far for us,” Scutella said. “We’re going to take over a burden that’s going to bite us.”

“To just take $2 million at this budget time is tough going ― it’s a tough sell,” Winarski added. “More selling needs to be done.”

Council voted along party lines to keep the $2 million in the Gaming Fund. Voting in favor were Horton, Scutella, Spagel and Winarski. Voting against were Bayle, Schauerman and Shank.

Council diverts ARP money to help court-appointed lawyers

Local courts have been seeking additional funding to help hire and keep court-appointed lawyers to provide reliable and quality legal representation to indigent clients or those who cannot afford an attorney on their own.

With $850,000 already in the budget for existing attorney contracts, Scutella introduced an action sheet to provide an additional $800,000 from the county’s share of American Rescue Plan funds.

Altogether, the roughly $1.6 million will support 24 attorneys for one year, Scutella said, adding that “the courts will work on how to continue that after the first year.”

County Finance Director Paul Lichtenwalter said the county is allowed to use ARP funds in this manner as per the advice of the county’s ARP consultant, Witt O’Brien’s.

Horton argued the expenditure was not in keeping with the spirit of the Rescue Plan and could also balloon out of control since benefits also involve family members.

Horton was the sole nay vote.

Council defunds two positions linked to Davis veto lawsuit

In October, council filed a lawsuit against Davis for vetoing seven budget cuts that council had made to the adopted 2023 general fund budget in November 2022.

By vetoing the cuts, Davis added more than $400,000 back into the adopted budget, including the addition of new positions, which have since been filled.

Council Solicitor Tom Talarico has argued that Davis violated the Home Rule Charter and that a county executive cannot veto items that will, in turn, increase the size of an adopted budget.

With legal matters still pending, council approved two action sheets Tuesday to eliminate two of those added positions: a recruitment and diversity position in the Human Resources Department, and an IT position in the Department of Human Services.

“These positions were never approved by council,” Talarico said. “The suit contends that the 2023 budget did not contain any funds for these two positions, and it didn’t.”

Talarico said the administration doesn’t have to fire the individuals in those positions; rather, the administration can submit supplemental appropriations to fund them.

Both action sheets were approved along party lines. Voting in favor were Horton, Spagel, Scutella and Winarski. Voting against were Shank, Bayle and Schauerman.

Other notable actions

Horton’s action sheet to eliminate the entire county Economic Development Department fell short, with only him and Scutella voting in favor. Horton said the department has not shown a return on investment. Bayle and Schauerman disagreed and said the department has been a critical boon to rural municipalities.

No action sheets were introduced to provide an additional round of funding to the Erie County Diversity, Equity and Inclusion Commission or Diverse Erie, putting its future in 2024 at risk.

Funding for the Greater Erie Community Action Committee and its Area Agency on Aging will remain flat despite a number of requests by GECAC for budget increases.

Council provided $25,000 to the Sisters of St. Joseph, whose entire $30,000 budget had been eliminated in the proposed budget.

For other items and actions, watch Tuesday's budget meeting at the Erie County, Pennsylvania ― Government page on YouTube at youtube.com@eriecountypa.

A.J. Rao can be reached at arao@gannett.com. Follow him on X @ETNRao.

This article originally appeared on Erie Times-News: Erie County Council approves budget with double-digit tax increase