ALLENTOWN, Pa. — Allentown City Council on Tuesday adopted a 2024 budget that included no new taxes — the second time it's done so in the past six weeks.
Council members rejected Mayor Matt Tuerk's latest request for a 2% tax increase before approving a 2024 budget that will take about $762,000 from the city's general fund to cover expenses.
Members Cynthia Mota, Ed Zucal, Ce-Ce Gerlach and Natalie Santos voted against raising taxes, while President Daryl Hendricks, Candida Affa and Santo Napoli supported a 2% tax increase.
Allentown Finance Director Bina Patel warned ahead of the vote that residents would see a double-digit tax hike in 2025 without an increase in 2024.
The 2% tax increase would have generated about $762,000 in new revenues and “fundamentally” changed the city's financial outlook, Tuerk said. The small increase would have likely staved off the need for a tax increase in 2025, he said.
‘Short-sighted’
Tuerk told LehighValleyNews.com that he will allow council’s budget to take effect without his signature.
Allentown’s home-rule charter requires the mayor to sign or veto a budget within five days of its approval by council. That budget is adopted by default if the mayor does not act.
“I feel strongly that we need to do a 2% increase, but I'm not going to veto the bill,” Tuerk said Tuesday. “[Council has] put our residents and our employees through enough already, and I'm not going to make it go another eight days or whatever.”
The mayor said members of his “incredible” finance team “worked their asses off to present a balanced budget” through a small tax increase.
Council’s budget instead relies on withdrawals from the city’s general fund — essentially its bank account — to balance spending.
“We did everything we needed to do to make the case for a small tax increase, and I think City Council, as a body, was short-sighted,” Tuerk said. “I think that they're looking exclusively at the impact on residents in 2024 and they're not thinking about the significant impact on residents that 2025 holds.”
Disappointing compromise: mayor
Tuerk said he views council’s budget as a compromise, as it includes several new positions and raises for police and EMS workers.
But he said he’s “incredibly disappointed that City Council chose to fund our expenditures with general-fund revenue.”
With its budget, council authorized Tuerk’s administration to spend up to $142.9 million while raising only $142.2 million in revenues.
Though the administration can “dip into the general fund” for $762,000 next year, Tuerk said officials will “try to get creative about how to reduce” expenses and limit their deficit spending.
Allentown’s general fund stands at about $34 million, which represents about three months of “operating cash” for the city, Tuerk said.
Tuerk said his initial proposal with a 6.9% tax increase “was an ambitious budget” meant to “serve the residents of the city of Allentown,” Tuerk said.
The city won’t be able to implement many of Tuerk’s initial plans without new revenues, but its employees will still work toward the same goals, he said.
“We're going to make the city safer; we're going to make the city cleaner; we're going to make the city healthier,” Tuerk said. “We’ll do that with whatever positions are approved.”
