Welcome to Election 2024 Q&A, a new series where LehighValleyNews.com reporters tackle the election topics that have readers scratching their heads. If you have a question about the election, feel free to submit it here.
Q: Can you help explain the Allentown ballot referendum?
A: When Allentown voters head to the polls or open their mail-in ballots, they'll probably be focused on the major races for president, U.S. Senate and U.S. House. But the last item on the ballot is this referendum question:
"Shall Section 807(B), Revenue, of the Home Rule Charter of the City of Allentown be amended to allow City Council, by Ordinance, to remove the Deed Transfer Tax?"
The Allentown Home Rule Charter is essentially the city's constitution. It sets the ground rules for how the city operates, establishes the various public offices, and defines what the powers and limits of those offices are.
Section 807(B) of the charter reads, "Council shall not raise the rates of the deed transfer, earned income, business privilege, the Emergency and Municipal Services Tax beyond $52, amusement devices, and resident taxes above their respective 1996 levels."
Every time people buy or sell property in Pennsylvania, they pay a deed transfer tax. The state collects a tax of 1% of the property value, but local governments may charge their own tax. The city and the Allentown School District each collect a 0.5% tax on these transfers.
Voting "Yes" on the referendum would allow the city to remove the cap on the city's deed transfer tax. It wouldn't automatically go up, but it would give council members that authority. Voting "No" would protect the tax cap and ensure the tax rate doesn't increase.
City officials have urged council to move this referendum forward. Councilman Santo Napoli said homeowners are being squeezed out of the market; LLCs and corporations bought 46% of all properties sold in Allentown in June, he said. Raising the tax would allow the city to raise millions of new tax dollars, which could fund programs such as one assisting first-time homebuyers, he said.
On the other hand, the Lehigh Valley Realtors Association, which represents the professionals who might be most affected by a hike to the deed transfer tax, has launched a campaign opposing the referendum. The referendum's wording is overly confusing, and a higher deed transfer tax will mean higher costs for every person buying, selling or renting property in the city, according to the Association.
