Commuters may lose N.J. tax benefit
While Bethlehem Township is pondering a no-tax-hike budget next year, hold off on the celebrations. Manager Melissa Shafer warned commissioners at their Oct. 17 meeting about something that could have a very negative impact on the township’s New Jersey commuters. It could also delay the flow of tax revenue next year. Shafer is referring to New Jersey Governor Chris Christie’s proposed termination of a Pa.-NJ reciprocal tax deal.
Under the current system, a township resident who works in New Jersey pays his income taxes in Pennsylvania, which is set at a flat 3.07 percent. Those taxes, along with the earned income tax, are usually collected by the New Jersey employer and remitted to Pennsylvania and the municipality.
Christie, miffed that New Jersey’s state legislature has failed to come up with $250 million in cuts to the healthcare costs of public workers, has proposed scrapping a nearly 40-year old reciprocity agreement, to bring in $180 million in taxes annually.
Unlike Pennsylvania’s uniform 3.07 percent tax, New Jersey has a progressive tax rate, depending on income. It can be as low as 1.4 percent or as high as 8.97 percent. Most township residents who work in New Jersey are on the higher end of the sliding tax rate. One township resident who works in New Jersey said that if he is forced to pay his income taxes there, it will cost him an extra $300 per month. He will pay more to commute to his job, too, thanks to a 23-cent per gallon hike in gas taxes.
“It’s a double whammy,” he said.
It’s a double whammy for the township, too. It will have to rely on residents with less disposable income to pay local taxes instead of relying on employers.
Shafer is uncertain how much of an impact this will be, but it seems increasingly likely that Christie will follow through on his threat even though it has infuriated new Jersey-based businesses like Subaru and Campbell Soup.
Bethlehem Township Solicitor Jim Broughal had a report for commissioners too. Although residents and commissioners are upset by the $2 million price tag for repairs at the 10-year-old community center, he has recommended against litigation. Most of the claims are time-barred, he explained. But a possibly defective roof did include a 20-year warranty, he advised, and commissioners unanimously have decided to make a claim with Johns Manville Roofing.
Commissioners also directed township Engineer Brian Dillman to study the Route 191 corridor between its intersections with Route 22 and Brodhead Road. Tom Nolan said that there have been 126 accidents at the Route 191-22 intersection since 2011, according to a report obtained by the township police. Though routes 191 and 22 are state roads, officials believe they might be able to change the timing of traffic lights in that area, and replace a “Yield” sign from Route 22 with a “Stop” sign. Nolan added that 18-wheelers have trouble turning onto Route 22 from Route 191.
Resident Barry Roth, who operates a tow truck, said the problem extends south to Perkins.”It’s a disaster,” he said. He noted traffic stacks along the entire corridor.
Commissioners also revisited their 2015 termination of K-9 Officer Dan Barsnica. He filed a grievance, but proposed a settlement under the terms of which the township would withdraw its termination and he would resign voluntarily. There would be no payout, and Commissioners voted unanimously to approve the settlement.