- When the Parkland School Board voted to close the district's tax office, it terminated an agreement in which townships gave the district $5 from the Local Services Tax
- The district would lose an estimated $300,000 in revenue each year if the townships decide not to enter into a similar agreement
- A district spokesperson said that figure is not accurate
SOUTH WHITEHALL TWP., Pa. — The closure of Parkland School District's tax collection office, seemingly a cost-saving measure, may end up costing the district.
And one of the district's townships has rejected an agreement that would prevent loss of revenue.
Parkland School Board at its July 19 meeting voted to close the district’s tax collection office because the person who heads it is retiring.
The office previously collected the Local Services Tax, which is levied on residents and nonresidents who work in three townships in the district: North Whitehall, South Whitehall and Upper Macungie
But when the board made that vote, it terminated a 2007 agreement in which the three townships gave the district $5 from the Local Services Tax.
The townships would gain — and the district would lose — a collective estimated $300,000 in revenue each year if they decide not to enter into a similar agreement with the district, according to an information packet for the South Whitehall Board of Commissioners’ latest meeting.
South Whitehall Information Packet by lehighvalleynews on Scribd
It's unclear how much money the district will save by closing the tax office.
District spokesperson Nicole McGalla said in an emailed response that it is “not accurate” that the district will lose $300,000 from closing the tax office.
McGalla said the district is “waiting for information from the three townships who have yet to solidify their agreement” regarding the tax collections and would not have further comment until then.
“Until the townships come back to us with information, there is no figure that can be shared related to a cost."Parkland School District spokesperson Nicole McGalla
The district has proposed an agreement that would maintain the revenue from the 2007 agreement.
“Until the townships come back to us with information, there is no figure that can be shared related to a cost,” McGalla said.
South Whitehall stated in a letter to the district that it does not plan to sign the agreement, according to Township Manager Tom Petrucci.
"No further agreement, including the Memorandum of Understanding that was proposed by your Solicitor, is necessary or warranted in the opinion of South Whitehall Township officials due to the fact that Parkland School District will no longer be involved in collection of the Local Services Tax for South Whitehall Township," the letter read.
The 2007 agreement
In 2007, the state passed the Local Tax Enabling Act, which let the township levy a $52 Local Services Tax.
The school district had previously collected a $10 tax, but after the law went into effect, the district was limited to a $5 tax.
To prevent the district from losing money, the three townships in the district agreed to give the district $5 of the Local Services Tax, along with a $1 collection fee.
Part of the 2007 agreement was that the school district would collect taxes for the townships.
When the district decided to close its tax office, that agreement was terminated.
Now, the district is proposing a new memorandum of understanding, or MOU, with the townships. If the townships approve the MOU, they would continue giving the district $5 of the Local Services Tax but not the $1 collection fee.
All three townships and the district have voted to make Berkheimer the new Local Services Tax collector. Neither North Whitehall nor Upper Macungie have taken action as to whether to sign the MOU.
‘Throw money away’
At the September school board meeting, board candidate Bobby Lanyon cited South Whitehall’s $300,000 estimate. He said the board made the wrong decision to approve the closure of the tax office.
“Unless the person who is retiring from this position was compensated about that much per year, it is very evident that this board has chosen to incompetently throw money away,” Lanyon said.
Lanyon is part of a candidate group called Elevate Education that is opposing another group made up of mostly incumbents.
"The culture on the board is to unconditionally trust everything the administration does and effectively rubber stamp every item on the agenda.”Parkland School Board Director Patrick Foose
Outgoing school board director Patrick Foose said at the board's Oct. 17 meeting that he was concerned about the potential loss of revenue.
He criticized district Director of Business Administration Leslie Frisbie for not mentioning it when giving the board information about whether to close the tax office.
“Looking back, I would have voted no on this line item because I have no faith or confidence in Ms. Frisbie's leadership,” Foose said.
“However, the culture on the board is to unconditionally trust everything the administration does and effectively rubber stamp every item on the agenda.”
Foose introduced a motion to reinstate the tax collection office, but no member seconded the motion.
In response to Foose's comments, Vice President of the board Marisa Ziegler brought up Frisbie's qualifications, which include master's degrees in Educational Leadership and Business Administration. She has worked in the field for 19 years.
Ziegler also said Foose chose not to sit down with district administrative officials to discuss his concerns.
"So who should we trust with the financials of the district: someone who's an expert in the field, or someone who refuses to seek out the information and understanding and would rather make bold, inaccurate claims at a meeting? I'm going to go with the expert," Ziegler said.
Will the district lose money?
If the townships don't approve the MOU or a similar agreement, the school district would lose the $5 from the Local Services Tax.
The district will lose an estimated $80,000 of revenue because of South Whitehall's decision not to sign the MOU, according to the information packet. It is unclear whether that loss in revenue could be made up by cost savings from closing the tax office.
Upper Macungie supervisors at their Sept. 7 meeting unanimously tabled the vote to authorize the township manager to sign the MOU. The township solicitor had previously “expressed his concerns with this understanding,” according to the meeting minutes.
Upper Macungie Township Secretary Jazmin Vazquez said township supervisors likely will discuss the MOU at its next meeting on Nov. 2.
The North Whitehall Board of Supervisors also tabled the authorization of the MOU at its Sept. 11 meeting.
At the September Personnel and Finance Committee meeting, Frisbie said the district “was anticipating the MOU to be approved,” according to the minutes.
Frisbie said at the October committee meeting that the district was “still waiting on an update from the townships regarding the status of the proposed MOU.”
After Foose criticized Frisbee at that meeting, district Superintendent Mark Madson said the district’s proposal “is neutral to the District, Township and taxpayers,” according to the minutes.
Frisbie added that the MOU and the tax office closure are two separate issues.
This report has been updated to correct the spelling of Leslie Frisbie's name and to add more information.
