Bensalem adopts earned income tax for 2016

James Boyle, the Wire

After years of holding off what Mayor Joseph DiGirolamo says was unavoidable, the Bensalem Council voted to enact a 1-percent earned income tax to help cover a $5.9 million gap in the township’s 2016 operating budget. The 4-1 vote has Bensalem joining a not-so-exclusive club of Pennsylvania towns that have an EIT.

“There are 2,527 municipalities in the commonwealth, and only 104 do not have an EIT,” said DiGirolamo, on the phone days after a four-hour council meeting that ended with the approval. “We’ve been holding it off for a while, but the option was either this or cut from our police force, and I refuse to do that.”

DiGirolamo says the EIT was the fairest way to come up with the necessary revenue to balance the $63.7 million budget, rather than an increase in property tax millage. Unlike the real estate tax paid by property owners regardless of whether they earn an income, DiGirolamo said, an earned income tax will be paid only by those residents of the township who are employed. Township property tax remains at 19.5 mills, or $726 for a resident with a property assessed at the township average of $37,251.

“Senior citizens and those who are out of the workforce, living on fixed incomes, will not be affected by the earned income tax,” he said. “An equally important factor in my decision to propose the earned income tax is the fact that the tax will also be paid by non-residents who work in Bensalem. People who work in the township utilize our services and our infrastructure, and under an earned income tax, they will share in the burden of helping to fund those items.”

The lone nay vote on the EIT, council member Bryan Allen, sent a lengthy email laying out his opposition. In the message, his biggest point of contention is with police costs, saying that the department’s expenses have increased 81 percent since 2006 and the 2016 police budget is up $2 million from the previous year without adding any new officers.

“Numbers were padded all over the budget,” Allen writes. “Despite the fact that gasoline prices have fallen every year since 2013 and are projected to fall further in 2016, fuel costs were budgeted much higher than last year for each department, in some cases by as much as $100,000 higher.”

He also questions the township’s continued use of the Lexington program, which allows officers and other department heads to take home official cars. The program started in the early 1990s as a way to raise visibility of police presence in the Bensalem neighborhoods, Allen says, but there has been an increase of unmarked cars included in the program that defeats the purpose.

“We have 23 unmarked cars being used for take home, 10 vehicles that are going home with people who live outside of the township, and motorcycles that must be kept in a garage,” Allen writes. “That does not help police visibility.”

According to Allen, Bensalem Public Safety Director Fred Harran defends the program by saying it reduces maintenance costs and increases response time to emergencies. Allen concedes the point, but says the offsets are erased by added fuel and insurance expenses.

DiGirolamo and township Finance Director John Chaykowski say Bensalem departments have cut costs as much as possible to avoid enacting an EIT. Many staff members have doubled up on work duties to avoid the need to hire more employees. The township also decided to not use the $45 million trust fund created from the sale of the water and sewer systems to make up the deficit.

“The average tax bill has only gone up $21 since I became mayor,” said DiGirolamo. “The problem is a lot of homeowners are getting their homes assessed, lowering the tax revenue. We have 100 police officers, with all of the health care and insurance costs that go with it. We have absorbed the costs tremendously for as long as possible and have cut other administrative expenses to the bone.”

Chaykowski said a third-party consulting firm estimated the EIT will generate between $8 million and $12 million for 2016. The township budget settled on the middle ground, anticipating a $9 million return.

10 thoughts on “Bensalem adopts earned income tax for 2016

  1. How the hell does one working in Bensalem and not reside there have to pay this tax they say we use services and infrastructure as a reason. Other than riding from work and back home what infrastructure do I use the road? Then everyone that drives through Bensalem should have to pay it too.

  2. Bensalem is one of the cash positive townships out there , I’m paying 19k for a building and another 9k for my house in taxes in that township .
    There good at spending money .My be time to move , they start with 1% and get use to that money and then next thing you know its 2%

  3. I live in Bensalem but work in Philadelphia, where I’m already paying close to 5% for the ‘privilege’ of working in that cash-strapped city. I also pay $4,000 a year property tax in Bensalem, for the ‘privilege’ of living in a townhouse with a yard the size of a postage stamp. Now Bensalem is charging me 1% wage tax when I don’t earn any wages in the township. We have a substandard public school system, in which elementary students don’t even get textbooks but teachers are making outrageous salaries for working 9 months a year. The teachers, along with their unskilled, uneducated, union counterparts throughout the school system and in other areas of the township, enjoy wages and benefits most Bensalem taxpayers will never realize. Apartment dwellers and multi-family households are not paying their fair share of the burden. The highly-touted casino, which time and again was voted down by residents but took up housekeeping regardless, was supposed to be saving Bensalem residents money. After beefing up the police force and gumming up the works on Street Road with traffic lights, punishing conditions on our roads, and an entrance to the Turnpike, who really didn’t see a new tax coming? What people don’t realize is that most taxes, especially those disguised as local ‘income’ or ‘wage taxes’, are totally unconstitutional. Once enacted, those taxes have nowhere to go but up. And this tax will go up, guaranteed. I’m surprised that Mayor DiGirolamo went along with the nimrods on the Township Council. I expected more of him, so I feel deep disappointment. My only consolation is that I have 5 years to retirement, and thereafter I will unload this house in this money-pit of a township and move to a place where I won’t be taxed into oblivion. If enough people like me leave, Bensalem is going to go the way of Philadelphia. It doesn’t take much imagination to guess what will happen then.

    • I believe Apt. dwellers are paying their fair share. The Apt. complex is paying taxes to the township out of money that is paid in rent. This tax is unfair to us as it is really double dipping into our pocketbooks.

    • you can take credit on your local return for phila taxes that you pay and you will not owe the 1% because that will be covered.

  4. Why is no one asking where the kick backs from the casino are going to in Bensalem when Parx first open the township gave all homeowners a $300 rebate then each year it has gone to to now we only get $100 and if revenue Bensalem gets from the casino is even 1% of their revenue there should be NO budget issues unless people are being shady and pocketing alot of money

  5. Employess paying Philadelphia Taxes are exempt from paying this tax. The bigger issue is that this tax may have doomed the Republican party in Bensalem. We have fought long and hard to keep the Philadlephia Rats (Democrats) from corrupting and bankrupting our town. This may be the kinfe that brings us down.

    The police force is out of control. The council should eliminate overtime and any extra perks that come with this bloated department. Also, teachers should no lnoger have guaranteed pensions. It’s that simple.

  6. Uhh wasn’t is suppose to be that the taxes Bensalem gets from that cash cow, Parx Casino, enough?? Something is wrong here??

  7. To all the comments on here, they don’t care, just “Pay Up”.. Also they will raise the % in the future. And they will say, pay up more. They dont care, just give them your money and blog comments zlitch to them..

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