Stroudsburg amusement tax proposal met with questions, concerns from residents

An amusement tax may be coming to Stroudsburg.

The Stroudsburg Borough Council talked about the possibility of adding an amusement tax during its Nov. 21 meeting, but took no action on it then or at the council's first December meeting.

Further discussion on it has been tabled until sometime in 2024 with a possible implementation effective in 2025, Borough Manager Lawrence Kopp confirmed to the Pocono Record after the Dec. 5 meeting.

At the Nov. 21 meeting, Kopp started discussions by saying that the borough has real issues in raising revenues, and that it has limited ways to do so. He also mentioned that Stroudsburg already has highest tax rate in the county.

"So, we’re trying to look in different ways to actually raise revenue so that we don’t overburden property owners in the borough,” Kopp said.

Kopp said the amusement tax would not be levied on the establishments themselves, but on the people who attend the amusements. The tax can be a maximum of 5% of the price of the ticket.

“I’m offering it as a way for us to potentially raise revenue that will try to keep our property taxes as low as possible,” Kopp said.

Kopp said, upon inquiries by Council President Matt Abell and Council Vice President Erica McCabe, that high school events would not be affected by the tax.

Kopp elaborated that the borough would be able to collect taxes by having events that charge a cover obtain a license prior to the event, which would let the borough know about them.

“It’s also basically like a hotel tax,” said Council Member Joanne Kochanski, who attended the meeting over Zoom.

“Mechanically similar to an income tax, it’s self-reported,” said Borough Solicitor Christopher Brown.

The proposed amusement tax drew many comments from attendees.

“So it always comes back to we the people, we end up paying more money to do anything,” attendee Theresa Pesce said.

“I think the intent here is to reduce the burden on our residents, and to have it, at least partially, funded by people that don’t live in the area,” said Abell.

“How do you know that people that live in the area aren’t attending?” Pesce asked.

“Well of course people do, but I’m saying that the lion's share of a lot of these, you know, college students that don’t live in the area that are patronizing it, they’re going to help fund this tax, as would people seeing a show at the Sherman,” Abell said. “At this point, it’s an idea we’re kicking around and we’re looking for, with the Route 80 project coming through, we’re going to lose a lot of income, and we have to make up that income somehow.”

“I think that, first of all, that this particular type of project needs a lot more consideration than one meeting, or three meetings, or whatever it is," said Sherman Theater Executive Director Richard Berkowitz. "As you can see, there’s not a single other amusement that is aware of this tax right now and can articulate what the ramifications of such a thing are.”

Berkowitz stressed how even though the tax may sound miniscule, when combined with other factors, such as net losses, competition with Wilkes-Barre/Scranton and Allentown, taxes and fees already added on tickets, parking, and emerging performance-rights fees with local bars, that it could affect businesses around the Sherman.

Abell reiterated that he is not ready to vote on the subject, but is ready to discuss it in an effort to start planning to generate more income in the future.

Attendee Michael Blake asked whether the borough could consider exempting locals from the tax.

“Well, that’s exactly why we pursue the idea that Larry's proposing, is we’re trying to have out-of-towners shoulder more of the cost of what that would generate,” Abell said.

“I’m saying all the costs, actually,” responded Blake.

“Well, I mean there’s a limit to how you can get out-of-towners to pay your taxes, I mean let's be honest. If you have some grand idea, we’d certainly entertain it,” responded Abell.

“I know it’s difficult, but I’m saying, keep in mind, anytime you can exempt the local from it, great, sounds great to me,” Blake said.

Abell responded that he understands Blake's concerns and that the borough regularly seeks out grants actively, and that they retain grant writers that provide "hundreds of thousands of dollars in return."

“So, every dollar we get that way doesn’t come out of your pocket. So we are looking out for you, it’s just, you have to be creative, especially facing the challenges that we’re about to face,” Abell added.

Former Stroudsburg school board member Cindy Blake encouraged the council to get creative, saying the I-80 project will lead to a tax increase on residents of the borough, even though I-80 will be used by the general public.

“So anything you could do, Matt, would be excellent to help alleviate that burden 'cause I know it’s coming, said Blake.”

Max Augugliaro is the public safety and government watchdog reporter at the Pocono Record. Reach him at MAugugliaro@gannett.com.

This article originally appeared on Pocono Record: Amusement tax discussed by Stroudsburg Borough Council