DuBOIS — The Pennsylvania Economy League (PEL) conducted a public presentation on the consolidation study for DuBois and Sandy Township on Tuesday at the DuBois Country Club.
Conducted by non-profit organizations, PEL and the Center for Government Research (CGR), the 200-plus page report studied:
- The financial and operational impacts of consolidating the city of DuBois and Sandy Township into one municipality.
- Examined tax and utility fee implications, service levels, staffing, facilities, collective bargaining, pension plans, Community Development Block Grant funding and more.
The fire departments of the two municipalities are undergoing a separate study, funded by the state Department of Community and Economic Development. Consultant Nick Sohyda, fire service specialist, also gave a presentation Tuesday in conjunction with the PEL.
A total of 54 people attended the in-person public meeting, where masks were required. A total of 135 people viewed the meeting live online or call-in by phone. The meeting lasted about 90 minutes.
Pennsylvania Economy League presenters included Communications Director Lynne Shedlock, Senior Research Fellow Gerry Cross and Chief Executive Officer LeeAnne Clayberger.
Shedlock and Cross reviewed the financial analysis and historical trends, noting that both municipalities experienced deficits in three out of five years from 2015 to 2019.
In DuBois general fund budgets, adjusted revenues were $7,676,883 in 2015, $9,656,020 in 2016, $8,027,997 in 2017, $12,862,909 in 2018 and $10,602,197 in 2019. Expenditures were $7,642,769 in 2015 (surplus of $34,114); $1,930,312 in 2016 ($1,930,312 surplus); $9,704,532 in 2017 (-$1,676,535); $13,485,645 in 2018 (-$622,736); and $11,263,667 in 2019 (-$661,470).
Sewer and water revenue and expenditures were removed from DuBois to better display general fund operations. The DuBois General Fund includes capital revenues and expenditures.
In Sandy Township general fund budgets, actual revenues were $4,039,739 in 2015, $4,146,652 in 2016, $4,124,042 in 2017, $4,412,537 in 2018 and $4,547,613 in 2019. Expenditures were $3,676,679 in 2015 ($363,060 surplus), $4,292,399 in 2016 (-$145,747), $4,667,034 in 2017 (-$542,992), $4,352,369 in 2018 (-$139,832) and $4,383,482 in 2019 ($164,131).
A financial analysis of the City of DuBois projections shows:
- Debt service and capital costs drop after 2019
- Deficit in 2020 followed by surpluses until 2025, when expenditures start to overcome revenues
- Despite anticipated surpluses, DuBois’ inelastic revenue sources are eventually unable to keep up with rising expenses.
A financial analysis of Sandy Township projections shows:
- Deficits are anticipated to start in 2023.
- Little revenue growth projected compared to anticipated increases in contractual wages and health care.
- Police department costs and health care are each anticipated to rise by approximately $250,000 from 2020 to 2025
Shedlock and Cross provided an explanation of township taxes:
- The township’s General Fund property tax millage is 13 mills; the state Township Code cap is 14 mills.
- The township also levies special purpose millage that does not count towards the millage cap; the total millage amount is 18.25 mills.
- The township would be required to seek court approval for millage increases over 14 mills.
- Township millage caps are lower than those for traditionally more dense urban areas; DuBois levies 23.5 mills and has a 30-mill cap.
- Special purpose millage can only be used for its stated purpose; it cannot be used for General Fund expenditures like police.
- Police are one of the largest cost centers for the township and projected to rise the most.
- The township is unable to raise any other tax rates to generate revenue because it is bound by limits in the Township Code and Act 511.
The presentation discussed the financial impacts of a consolidation:
Lower combined municipal tax millage
- 16.06 mills with no special purpose districts
Current millage is 23.5 mills in DuBois and 18.25 mills in Sandy Township
- Up to 17.6 mills for those with one or both special purpose districts (hydrants and streetlights)
- Assumes elimination of over $500,000 over time in duplicate position costs through attrition and buyouts
- Estimated property tax savings of 25 percent in DuBois and up to 12 percent for Sandy Township (lower property taxes are only one aspect of consolidation)
Lower combined municipal utility rates for most township residents in addition to lower taxes
- All Sandy Township residents that receive sewer and/or water services through the township would now pay the city’s lower rates. (Township residents billed directly by DuBois for water already pay rates lower than the city and township rates. These residents will see a water rate increase to the uniform rate.)
- Treasure Lake residents receive water and sewer services from a private utility so those rates would not change. Property tax savings will still occur.
- Sandy Township residents could see total annual savings of over $400 based on the median assessed value of a home in the township.
At the end of the presentation, PEL provided a proposed timeline to consolidation as follows:
- DuBois City Council and Sandy Township Board of Supervisors vote to authorize the formation of a Joint Committee made up of community and elected representatives
May 2021 to December 2021
- Joint Committee creates a Joint Agreement and drafts Home Rule Charter (as applicable)
- Considerations for form of government, municipal name and boundaries, disposition of assets and assumption of debts, transition plan, language directing the treatment of fire protection within the consolidated municipality, etc.
December 2021 to January 2022
- Governing bodies review and consider whether to put the Joint Agreement and Home Rule Charter (as applicable) on the May ballot.
January 2022 to May 2022
- Public meetings held for comments on the ballot question
- Proposed date for public vote on consolidation of May 2022
Shedlock noted that while the PEL can make recommendations and look at the feasibility of a consolidation between the two municipalities, ultimately, it is up to the city and township residents to decide.