Westfall Township, Matamoras, PA
October 2, 2012
A public hearing was held on Tuesday, October 2, 2012 for the purpose of taking public comment on the proposed Amusement and Transaction Tax for WestfallTownship. The meeting was held at the WestfallTownshipBuilding on Delaware Drive and LaBarr Lane, Matamoras, PA18336 at 7:05 p.m.
Those present were Chairman, Robert Ewbank, Vice-Chairman, Paul Fischer; Supervisors, Raymond Banach, Larry Flansburg, and Robert Melvin; Solicitor, Robert Bernathy and Secretary, Lisa Green. Also present were Treasurer, Scott Myer, Ann Marie Catalano, Bob Bostinto, Michael Sullivan, John Schneider, Allen Johns, Bob Stewart, Tony Brunovsky, Bill Behrens, Brian Shaub, Beth Brelje, Kurt Staiger, Linda Deboer, Doug Hay, Rick Lander, Dave Jones, Michael Barth, John Dalton, Lisa Mickles, Ann Pilcher, and approximately 37 members of the general public.
Chairman Ewbank welcomed everyone to the meeting stating we would be having a public hearing on the Transaction and Amusement tax and turned the meeting over to Solicitor Bernathy.
Solicitor Bernathy said he had information to share with everyone as we are here regarding a hearing for purposes of considering the enactment of a tax. Stating it is sometimes not necessarily well received. The supervisors do not intend to the address that portion of the ordinance that deals with the transaction tax on the sale of fireworks. The supervisors may in the future consider a transaction tax on the sale of fireworks in addition to possibly a tax on the sale of cigarettes but that is not going to be considered this evening. The supervisors will provide an opportunity for those entities who sells fireworks additional time to meet with and address concerns. We received correspondence from at least two entities within the Township who sell fireworks who asked that the matter be delayed so that they may be present; including but not limited to BJ Alan Incorporated. Keystone Fireworks is represented. With that said the purpose this evening is for the enactment of an amusement tax. To be clear this will be a tax on the entire amusement industry which includes all manner and forms of entertainment with specific regard to sports, recreation and pastimes which admission charges are obtained from the public directly or indirectly. Notice of the hearing was provided pursuant to the 2nd Class Township Code section 1601. The supervisors are required before they adopt an ordinance to provide notice of hearing by publication not more than 60 days nor less than seven days at least once in one paper circulating generally in the Township. Proof of publication will be entered into the record of these proceedings. This notice was placed in the Pike County Dispatch with the entire text of the ordinance which was run on September 20,2012. Notice of the hearing was additionally provided at Supervisors previously scheduled regular meetings which were advertised in the beginning of the year. At those meetings discussion transpired, questions were asked and answered deliberation occurred. At this time Solicitor Bernathy asked to bring everyone’s attention to the local tax enabling act that provides that a Township may in its discretion by ordinance for general revenue purposes levy, assess and collect as it shall determine on a person, transaction, occupation, privilege, subject and personal property within its limits. So the law is very clear regarding what the supervisors can do. The supervisors find that a more uniform tax application is called for to specifically relieve the burden which they find is unfairly placed upon the shoulders of property owners within WestfallTownship. It is necessary as well in light of the impact on the Township which resulted from certain litigation, also which required the Township as everyone knows to file for bankruptcy protection which resulted in the Township being declared as we speak a distressed municipality currently participating in the Act 47 plan. It is the supervisors stated intention to once the tax is enacted and collected in conjunction with additional future tax purposes which may include transfer or earned income tax, to reduce property taxes on the property owners of the Township; to place a partial burden on those who use the Township services and resources without having to pay for the services which includes streets and roads, emergency services, fire and rescue, Eastern Pike Regional Police Department. All of these services which are provided by the Township and paid for by the property owners within WestfallTownship. Hopefully there’s going to be a more uniform application of the tax to reduce the property taxes upon the property owners and the Township. Reference is specifically made to among other cases the case of Whitewater Challenges vs. WeatherlySchool District. That is a case that was reviewed by the Commonwealth Court in Pennsylvania back in 1989. Specifically that was a case that had to do with specific regard to the administration of an amusement tax and how that local court upheld the administration of that tax upon the canoe liveries service. Solicitor Bernathy said we are not singling out the canoe liveries, however in this case that has been upheld by the court identified as an amusement tax and agreed with the lower court regarding the administration of that particular tax. The supervisors want to recognize that various other municipalities have enacted similar amusement taxes including the city of Pittsburgh, Johnstown, PennTownship, various other municipalities have enacted these amusement taxes and they have been upheld by the court to be a valid exercise of the Township Supervisors authority. Going back to the issues that may be raised regarding preemption, that case that Solicitor Bernathy referred to indicated and ruled specifically that that kind of amusement tax was not a preemption of a field nor express statutory prohibition of a local taxing authority when assessing an amusement tax on a White Water livery and that was requested on those grounds. With that said and understanding that these types of amusement taxes have been enacted in various places in the Commonwealth we would proceed by saying research has been done on this and Solicitor Bernathy has contacted the Pennsylvania State Association of Township Supervisors, out of Harrisburg. We pay a fee and they help us to provide services to all of the townships in the Commonwealth. They have reviewed the ordinance as it has been prepared and stated through their counsel Scott Coburn that this is admissible and constitutional and they have made it a legislative priority to maintain amusement taxes across the state. With that said we are only proceeding on those limited circumstances. There’s going to be additional language addressed here and we intend to take additional time after this as required by law to re-advertise and to do so within 10 days. Whatever additions are made will be advertised as well. Solicitor Bernathy asked that those present who would like to make a statement raise your hand, state their names and be recognized to be a part of the proceedings. Michael Sullivan with the Pike County Chamber of Commerce; John Schneider representing the canoe livery owners, Rick Landers, Dave Jones and Tony Brunovsky and also others that are not here tonight; Ann Pilcher with the Pocono Mountains Convention and Visitors Bureau; Allen Johns, Bob Stewart Pennsylvania Pyrotechnics Association and Tony Brunovsky owner of Indianhead canoes. Solicitor Bernathy said as this progresses if somebody else wants to make a statement that is fine, it is not our intention to not hear what anyone is saying and we certainly appreciate everyone coming out. With that said copies of the ordinance are provided here and have been advertised. Regarding moving forward with the adoption of the specific type of tax we’re going to add registration requirements ordering that every producer who at the time is conducting and every producer who thereafter begins to conduct any amusement within the Township shall register with Township Secretary on forms provided by the Township, the Township will issue an annual or temporary registration certificate. There are also reporting requirements of the producer for purposes of ascertaining the amount of taxes collected and payable by the producer to the Township in the form of a report of the amount of the tax collected by the producer during the preceding month showing all of the information which is required by the Township. In addition we would also like the record to reflect that we have a collection agency in mind, the supervisors have designated Berkheimer Associates. There is a proposal that has been received from Berkheimer Associates as far as who is going to be actually collecting. Solicitor Bernathy asked if the supervisors would like to make a statement before we progress.
Chairman Ewbank said just to reiterate what was said we are not singling out any one entity. We are just trying to reduce the tax for property owners in WestfallTownship. We are not trying to penalize anyone, this is going to help everyone if this tax is enacted it is going to be a win-win situation for everyone involved.
Supervisor Banach said it has been a long time and that we have thought very hard about this. In fact people have asked from the audience since 2006 and 2007 on how to
come up with ways to provide revenue to lower the taxes in the Township. Further stating that if any people travel you pay a few cents extra for things, if you hunt out West and buy a deer license you pay $.50 to be rescued. It’s one of the things that we are looking for people who use our facilities to chip in a little bit and reduce the taxes for the residents. That is our hope and goal in this. It is not to penalize anyone it is to have the people who are using our resources in the Township to contribute a little bit. If you travel and you look at your bill at the hotel you pay a percentage and that goes to the municipalities.
Supervisor Flansburg added that to be clear the taxes that we collect will also lower the taxes for the people that are being taxed. Someone asked if that will be in writing. Supervisor Flansburg answered sure. Solicitor Bernathy said that will be made part of the minutes and he wants everyone to understand that that is the overall intent and this is the first step in making a uniform application of the tax to spread out the burden and make a more uniform and fair way for the property owners which includes ironically the liveries which may own property in the Township and eventually get their property taxes reduced.
Bill Behrens asked if eating would be considered an amusement. Solicitor Bernathy said no that would not. If you pay you for something such as an admission fee for recreation, sporting events and concerts, live forms of entertainment and certainly if you’re serving dinner or having a function and you are not providing entertainment or amusement it would not apply. If you charge an admission you will be charged. For example if you go to a bar and there’s a guitar player and you are not paying for admission you will not be charged. The focus is on the entertainment and amusement industry. To make it fair you have to be paying for something within the limits of the Township. Solicitor Bernathy said just so everyone understands it amounts to one penny on the dollar. For instance if you are charged five dollars it amounts to five cents.
Brian Shaub of Keystone fireworks questioned if 1% is as high as it can go, or if it can increase in the future. Solicitor Bernathy said his research reveals that it can go as high as 2% and the supervisors are considering something much less than that. Further stating there is a question regarding how much revenue this is going to generate, unlike the Earned Income Tax we had Berkheimer tell us how much that would generate. Stating that 90% of Pennsylvania has an Earned Income Tax, we are one of the few that do not have it, however that is not on the table tonight. Brian Shaub asked if it is capped at 2%. Solicitor Bernathy said yes he believes so and that there is case law prohibiting us from doing anything on the movie industry. That is exempted. There are certain cases which exempts certain things, however there are also cases which have been ruled by the court such as canoe liveries have already been held to be amusement can be taxable under the local tax.
Attorney John Schneider asked Solicitor Bernathy to confirm they were not going to act on anything tonight that the board was going to re-advertise. Solicitor Bernathy said that is correct they’re going to re-advertise within 10 days before they make a decision which has to do with any additions to the ordinance. Mr. Schneider asked if there was going to be another public hearing. Solicitor Bernathy said that is up to the supervisors. They have to at least wait 10 days before they can make a decision because they’re adding certain provisions this evening which have to do with collecting the recording requirements in that the businesses are going to have to get a certificate from the Township Secretary. That puts the recording requirements on the producer to go right to Berkheimer. Mr. Schneider asked if he had copies of the latest draft. Solicitor Bernathy said that has not changed they’re just deleting provisions from the draft involved in the transaction tax as it applies to the sale of fireworks. They are only deleting provisions as far as the advertisement is concerned. He has already gone over the additions that have been made. Mr. Schneider questioned if section 5.b that involves 1% on the canoe liveries will be about amusements in general. Solicitor Bernathy said yes.
Rick Lander asked if there was an exemption for navigable rivers. Solicitor Bernathy said that is not something that he could find in the case law. Mr. Lander asked if they’re charging an amusement tax on the Lehigh. Solicitor Bernathy said he could not answer that question. However in the city of Pittsburgh they are charging a 5% amusement tax and he found some cities charging as much as 10%. Yet solicitor Bernathy thinks the ceiling is 2%.
Allen Johns asked if it was one percent on their gross income. Solicitor Bernathy said whatever you are charging for admission for purposes of entertainment, recreation, or sport it would be 1%. So if it’s seven dollars to get in you’re talking about seven cents. It is only for their admission cost it does not include food or drink. This is a general application to the amusement industry not only on canoe liveries.
Ann Pilcher asked if safety equipment would also apply to the tax. For example the safety equipment involved with renting a kayak or canoe. Further questioning if you would deduct the cost of the equipment. Solicitor Bernathy said it would be the actual charge.
Beth Brelje asked if we could the list all the entities that will be taxed. Solicitor Bernathy said specifically it is the intention to address the entire amusement industry that includes all manner and forms of entertainment including but not limited to concerts, circuses, carnivals, all forms of entertainment and parks, floor shows in addition to canoe liveries. It would be applicable to a golf course.
Robert Bostinto asked if local schools are exempted from this tax. Solicitor Bernathy said he found examples where the school district passed this type of tax.
Solicitor Bernathy said this is not the sales tax, and we are engaged in some type of speculation as to how much revenue this will generate.
Kirk Staiger asked if we had projected revenue and whether or not the 1% would justify the record keeping and collection effort and entanglements that this would entail.
Supervisor Banach commented that we are at 31.2 Mills and our general government has been above 14 Mills for the last several years. If we can get it below 14 Mills which is a state mandated and take 4 or 5 Mills off our taxes that will be the greatest thing. Stating if we have a windfall at 1% we will reduce taxes or lower the amusement tax. Chairman Ewbank stated the boards thought is that at one percent if you were paying $100 for something would you balk at paying an additional one dollar. Mr. Staiger said he wouldn’t but he knows many people that would. Supervisor Flansburg said he wanted to be clear on something in that the state of Pennsylvania taxes everything there is to tax and there is the little tiny window of things that we can do and this is one of the things that we can do. Supervisor Banach said we didn’t dream this up overnight we have written to Sen. Baker trying to impose a county sales tax. Stating basically WestfallTownship is the Mecca for all the businesses here in the County and we get all transients and nonresidents coming in to our community and using our facilities and we do not get anything back. Further stating our taxpayers hold the burden of that. If we received a county sales tax and that was spread amongst the County we could lower people’s property taxes. The County and Lisa Baker are working on that but it could be 20 years off. This is one way of trying to make it fair for the residents of our town. Solicitor Bernathy said we are trying to make it fair for the emergency services as well because they will benefit from this tax. River rescues were discussed. Chairman Ewbank stated the cost to the fire department over the last few years is at $50,000.
Bill Behrens questioned the buses coming into the Hotels for entertainment and a meal, would we be able to get that revenue. Solicitor Bernathy said if they charge admission yes. The room no.
Dave Jones the Kittatinny Canoes questioned how you were going to collect fees from the other users besides the liveries. Solicitor Bernathy said we’re going to place a reporting requirement, we’re going to put the burden on anyone recognized being in the industry. Mr. Jones said he is talking about people that fall off the cliffs, and people that swim and drown. Solicitor Bernathy said he understands what Mr. Jones is trying to say that those River rescues are not all from people who rent canoes.
Bob Stewart from Pennsylvania pyrotechnics said for those interested in the amusement tax just Google PSATs and Google Pennsylvania amusement tax. Also stating he’s seen amusement taxes going up to five and 10% stating it is maxed out at 10%. Mr. Stewart asked if the township is placing an amusement tax on Phantom Fireworks and Keystone Fireworks. Solicitor Bernathy said that would be a transaction tax and that is not on the table this evening. Mr. Stewart said because they pay substantial property taxes and this would be an additional tax as well. Supervisor Flansburg said they are not paying anymore property taxes then our residents pay. Chairman Ewbank said this is a tax that they can add onto their admission in the goal in the end would be to reduce property taxes. Mr. Stewart said they have allocated funds for litigation. Solicitor Bernathy said he is sure they have and he understands that all eyes are probably on the Township from up and down the borders.
Beth Brelje asked if the supervisors could help her with the math because they indicated that it was difficult to keep the budget in check and yet stated that they were going to give money to emergency services and lower property taxes. Stating that seems like an awful lot to do with maybe not a huge sum of money. Chairman Ewbank said we do not know what were going to generate. However, if Mr. Jones told us how many canoes they rented that would help. Solicitor Bernathy said that however they do not have to give us the information.
Mr. Bostinto said at $1 million it is only $10,000 worth of revenue. Stating it is not a lot of money. Discussion followed.
Rick Lander questioned if this is a tax does that mean that tax-exempt organizations are exempt. Also stating that he has a landing in WestfallTownship that is just a landing spot and most of his transactions are all up north in New YorkState. Solicitor Bernathy said he would argue that contact is made within the jurisdictional limits and if they are getting off the river here in WestfallTownship they would be taxed. Supervisor Banach said property taxes that the Township receives from Mr. Lander is $395.93. Mr. Lander said it is more than that. Supervisor Banach said that is the money that the Township receives it does not include County or School tax.
Mr. Johns asked what happens if your company was running in the red and that if their gross revenue is $1,000,000 and they are $150,000 in the hole. Solicitor Bernathy stated there is no hardship exemption. Mr. Johns then questioned if he is paying $20,000 in real estate taxes is that not going to be taken off the top of his gross revenue. Supervisor Ewbank said it is the one percent charge on admission to each facility. Discussion followed. Mr. Bostinto stated this is the pass-through charge and said that people should put into context and look at their cell phone bills because one third of the bill is taxes and surcharges. Further stating the fee is just one penny on the dollar. Discussion followed.
Michael Sullivan said when the federal income tax started in 1913 it is important to realize that it was one percent and now we are paying over 40%. Mr. Sullivan said he understands the boards circumstances however one of the things of the Chamber is upset about is that there was no contact between the board and the people who were going to be impacted. Mr. Sullivan said he realizes it’s a $.44 tax on the canoe that’s going to rent for $44 however the business owners are concerned because they are already being taxed heavily and they feel there is a limit on what people will pay. Mr. Sullivan said in 2007 we had 977 businesses in PikeCounty employing over 8000 people, the next year there were 949 and the year after that there were 917, in 2010 they were down to 887 stating they have lost over 10% of the business community and approximately 600 jobs. Further stating there are livery people here who didn’t make any money last year. Mr. Sullivan says if you divide the cost of the canoe by .29 that will tell you how much it costs for the people to make the trip to come up. Mr. Sullivan said you don’t want to go against tourism, also commenting on the enforcement provisions of the ordinance saying he feels it sounds pretty tough. Solicitor Bernathy said that is only if they don’t comply with the recording provisions and that the Township is going to try to make that as user-friendly as possible. Solicitor Bernathy said he is a small business owner and the business owners are welcome to speak as well. Further stating the Supervisors have 90 days to enact the ordinance and that this is the purpose of the public hearing to take public comment. Supervisor Melvin said as a board they have to do things according to legal requirements they can’t go out and talk to businesses separately because it would be a violation of the sunshine law. This is why the ordinance came out and they had a public hearing.
Linda Deboer stated that a few years ago when the local service tax was passed she had to pay $52 per year to work in WestfallTownship and no one contacted her and asked her feelings on the subject. Questioning why should it be any different now. Mrs. Deboer said people do not call you to say what is being proposed.
Vice-Chairman Fischer said they been talking about an earned income tax for the last several years and we are trying to get around that. Some of the supervisors do not want to impose that tax so they are trying to get around that any way they can.
AnnMarie Catalano of Milford Landing said she lives in a private community and they are self-supporting. She thanks the Police Department and fire department for coming in and helping them and further thanked the Supervisors for imposing this tax stating her husband is 87 years old and hasn’t had a raise in his pension since the 80’s and they would love to go down the river but they can’t afford it.
Mr. Johns said he knows just about all of the supervisors personally, stating the supervisors could find out how much revenue this tax would generate. They could’ve asked and used his business as a model. Supervisor Flansburg said quite frankly Mr. Johns just came in to the mix tonight when they decided to uniformly apply the tax. Mr. Johns said a few years ago he helped out with snowplowing and that may be he and the other businesses could get together and hold a fund raiser. Discussion followed.
Attorney Schneider said as the Westfall resident he applauds the supervisors for trying to reduce the taxes in general, however something that concerns him is the penalties and he sees a logistical nightmare commenting that the business owners are going to probably try to find a rope way not to meet the provisions. Mr. Schneider said he did want to speak regarding the enabling legislation as he stated in his memo to Solicitor Bernathy whereby Solicitor Bernathy mentioned the case of Whitewater. Mr. Schneider stated that tax is before the Maritime Act that was passed in 2002; which basically provides that you cannot tax anything that goes on to a navigable stream. Stating there is a case in Pennsylvania where the court ruled that the Township did not have the right to impose any fee on the rental of canoes going into their rivers because it was a navigable river. He also has a Tennessee case from the Supreme Court, where they upheld the 2002 Act. Stating it is interesting the way that 2002 passed because they are not collecting the tax any longer. Mr. Schneider feels the canoe liveries are exempt. Solicitor Bernathy said he respectfully completely disagrees with. Mr. Schneider. Stating he has cases where various other municipalities that impose the amusement tax. Mr. Schneider said he also found an exemption regarding exercise and weight management, questioning if this would apply. Solicitor Bernathy said if he wanted to try to prove that exemption he was welcome to try.
Luis Bocaletti, president of the Westfall fire Department wanted to make sure the public realizes this is not an emergency services tax.
Beth Brelje questioned if the board just decided tonight to uniformly apply the tax. Solicitor Bernathy said went on through the day. Ms. Brelje questioned if this was at a formal meeting. Further questioning the high school football games suggesting the high school sporting events is a super low ball kind of the tax. Solicitor Bernathy said we have to make sure that this uniformly applies to all forms of entertainment and that includes sports. A resident questioned if the School District was tax exempt. Solicitor Bernathy said he didn’t believe so. Discussion followed. Mr. Bostinto questioned to be clear the amusement tax has been imposed by other municipalities throughout the state and has been successfully defended against litigation. So if someone wants to bring suit they probably will not be successful. Solicitor Bernathy said he is not saying that with all due respect to the attorneys and business owners present.
Mr. Jones says as a tax payer of WestfallTownship he would love to see the taxes reduced and he would like to see revenues increased, but he questions if revenues will be decreased because businesses won’t be likely to come to WestfallTownship. Also, questioning why should he stay in WestfallTownship when he has land across the river, because if this tax is imposed that’s where he’s going to go. Commenting if you want to make more money you should not kill the goose that lays the golden egg. Mrs. Deboer said she doesn’t know what golden egg he is laying. Supervisor Banach questioned the amount of sales tax he is paying in Pennsylvania which is 6%, New York is 8.25%. So if he moves across the river he will still be paying 1 1/4% more. Mr. Jones said that’s not entirely true. It costs more money to travel throughout WestfallTownship adding an additional 6 miles to their trip which cost time and money. Further stating that last year he made hardly any money and this year even though the weather is nicer their numbers are down because people can’t afford to come. Mr. Jones said people want to go to a water park or go to the shore or a concert, stating that they are seeing a decline in this business. Supervisor Banach questioned if he remembers when the fire departments asked five cents per canoe and Mr. Jones refused. Mr. Jones claimed if they get rid of the tax they will give the fire departments more money than the tax will generate. Solicitor Bernathy asked what Mr. Jones is proposing. Mr. Jones said we should step back and take a good look at this tax and talk to the businesses. Further discussion followed regarding being business friendly and holding fundraisers. Mr. Jones said there is a lot of ways to generate revenues. Mr. Jones said they’re forcing business out of Westfall and in the end they’re going to get less.
Supervisor Melvin said they’ve done different things such as eliminating the building inspector and going third-party, so that we do not have to pay an inspector unless a permit is issued. We’re trying to do things to lessen the burden on the cost side and cutting other costs and trying to manage that for the 2000 residents that are here. Supervisor Flansburg said for anyone that thinks we are not business friendly they were not at the last meeting where we made amendments to the zoning laws to allow businesses to operate. Mr. Bostinto said two years ago people were up in arms over the Katz tax and he applauds the supervisors for thinking outside the box, stating that if you’re not part of the solution then your part of the problem. Vice-Chairman Fischer said we’re still entertaining the earned income tax and he personally does not want to go that route. But if we don’t find another way that may be the route were going to go.
Mr. Sullivan questioned how much undeveloped property we have in Westfall suggesting that we could get more revenue from developing the property than we can through this tax. Chairman Ewbank said unfortunately the Route 209 corridor is pretty much built up.
Ann Pilcher, Director of Community Relations with the Pocono Mountains Convention and Visitor Bureau said she originally came to speak on behalf of the canoe liveries and after hearing how the tax is going she is now here to represent yoga instructors, workshops, recreational providers, and wellness providers throughout the whole region. Stating this is an economic issue. The board is looking for a solution and the Pocono Mountains Convention and Visitors Bureau is looking for solution. Ms. Pilcher said this will impact all of those businesses that are coming in and they are big supporters of Whitewater challengers. Further stating this four county region that she’s speaking of is generating $1 billion in the area. Ms. Pilcher said they have a lot of CDD friends that have dealt with this issue and have tried to find solution for emergency services specifically. Ms. Pilcher suggests the businesses getting together and making a donation to the emergency services, saying she just wanted to voice her support for these businesses. Supervisor Melvin questioned if they had a figure on what the hotels in our area are paying in the hotel tax for the tourism board. Because everyone else can come into our town and we don’t have access to the money, but the tourism board does. Ms. Pilcher said part of the money from that hotel tax goes to support the businesses in WestfallTownship, in marketing programs. Supervisor Banach said not to be argumentative, however, a specific canoe livery spends less than $400 in land taxes to WestfallTownship and to compare that to the impact they have on the Township doesn’t compare. Mr. Jones asked Supervisor Banach to tell how much he’s paying in taxes. Mr. Jones pays approximately $7000 to WestfallTownship. Mr. Sullivan said in the end you are adding to their cumulative effect. Further discussion followed.
Tony Brunovsky of Indianhead Canoes said he came to the County 37 years ago , putting his financial welfare on the line and growing his business. Stating part of the reason Best Western is doing well is from the influx of visitors in the summertime. Mr. Brunovsky feels that the private camps and private people that use the boat landing do not pay anything to the Township and yet the supervisors want to tax the businesses. He feels that everyone should sit down together and see what they could come up with. Commenting that the enforcement provisions of the ordinance scare him. Mr. Brunovsky said he would bet that local businesses rely on the summer influx of visitors. Mr. Bostinto questioned how much property tax would be reduced with the imposition of this tax. Solicitor Bernathy questioned the $44 canoe rental charge. Asking if that is the average price. And asked how many individual can hours the average per year and how much do they pay. Mr. Brunovsky said the National Park Service has those figures. Further discussion followed regarding getting together and the tax on the school districts which Mr. Brunovsky finds offensive. Supervisor Flansburg said he for one is in favor of a discussion behind closed doors with the business owners. Mr. Schneider said the canoe liveries also pay permit fees to the National Park Service and there is administrative red tape that they go through to run their businesses. Supervisor Banach questioned if these liveries pay the Park Service for the use of the river. They do. Mr. Jones said we should be getting part of that money back in grant money. The Township doesn’t receive any money in grants they were cut two years ago.
Mr. Barth questioned the tax on the sporting events. Solicitor Bernathy said it is the 1% tax on the admission to sporting event. Saying it would be one penny on the dollar for the Township and thousands of dollars for the school district to figure out the record-keeping. Stating the school taxes are going to go up.
Ms. Pilcher asked if Berkheimer Associates has a cost proposal on what they will charge to collect the tax. Solicitor Bernathy answered 3%.
Mr. Jones said he didn’t want to question what Mr. Bernathy received per hour but Supervisor Banach said Solicitor Bernathy receives $100 per hour and his firm normally receives hundred $150 per hour to $200 per hour, and we will not let him go above that. Mr. Jones asked if they figured litigation into the costs of this tax. Solicitor Bernathy said he does not feel this tax will cost a lot in litigation, because he has case law where the amusement tax has passed. Mr. Jones said they cannot pass this cost on to their customers, further stating there will be mistakes made and possibly the supervisors are looking to gain money through violations. Solicitor Bernathy said that is a maximum penalty per day for willful violations. Mr. Jones spoke more about his opposition to the tax. Supervisor Flansburg said once again he is open to discussions with the businesses.
Mrs. DeBoer said she didn’t know that you could negotiate a tax. Ms. Brelje questioned if they had ten days to readvertise. Solicitor Bernathy said yes they have 10 days to readvertise and 90 days to take action. It is up to the board to make a decision on what they want to do.
Mr. Brunovsky said since they have taken the fireworks transaction tax off the table. Why do they not table the amusement tax. Saying they are going into their off-season and there will be no revenue now. Supervisor Melvin said that’s why they’re discussing it now during the off-season.
Doug hay said the board should be commended for trying to reduce property taxes. In the long run he believes it’s worth having a dialogue and he believes the board is on the right path. Mr. Jones continued with his feelings on the opposition of the tax. Citing advertisement costs, and his feeling that the board is driving him out. Supervisor Banach said the only other way we can raise revenue is to raise Mills and increase taxes and we are trying to find ways to control our Millage. Further discussion followed. Mr. Barth commented that both sides cannot agree so why not agree to get together. John Dalton said the supervisors are willing to work with the businesses and make a decision, stating the Township needs the businesses and we need to come up with numbers and projections. Inviting the businesses to meet with the Supervisors.
Supervisor Flansburg questioned if they advertise they have 90 days to take action. Solicitor Bernathy said if you want to readvertise it would be to refine the ordinance and focus on the amusement end of things and then have an additional public hearing to make it clean. Supervisor Banach questioned if the businesses want to come to one of the meetings that we have scheduled for the budget to sit down on the 9th or 17th of October. Solicitor Bernathy asked if the business owners would provide numbers to the Township in confidence knowing that the Township will keep it in strict confidence and not disclose those numbers. Mr. Brunovsky said you can obtain those numbers from the National Park Service. Supervisor Banach said during the previous two boards people from the public have said we need to find more ways to reduce property taxes. Supervisor Flansburg said the business owners have suggested a solution can be brought up here, so we’re inviting you to meet with us. Mr. Brunovsky asked if we have our figures together on what the school district is generating. Further discussion followed.
Supervisor Melvin said we have always talked about an amusement tax. But when you think about our Township the focus automatically goes to the canoe liveries. Mr. Schneider said the ordinance as proposed specifically mentioned canoe liveries, and his clients are not willing to put anything on the table other than make contributions to emergency services. Further stating if we don’t have numbers they are not going to give us numbers. Questioning if we know what the amusement tax effect will be on other businesses in WestfallTownship. Mr. Schneider said he provided case law to Solicitor Bernathy which he respectfully asks that it be reviewed. Suggesting that there be a subcommittee to meet with the businesses. Supervisor Banach said we have meetings on October 9 and 17th and that is when the board will be together.
Kurt Staiger stated the Township is in distress due to legal issues and has concerns that litigation on this tax could run into the tens or hundreds of thousands of dollars, also suggesting that the supervisors meet with the business owners. Supervisor Flansburg asked if Mr. Staiger is aware that they cannot meet outside of an advertised meeting. Mr. Staiger said he will encourage the businesses to meet with the board.
Ms. Pilcher questions if we have a list of businesses that this will affect. Solicitor Bernathy says they have some sense of who that will affect. Solicitor Bernathy commented that the Bureau and Chamber could probably obtain that information and provide it the Township and we would certainly welcome that.
Supervisor Banach moved to re-advertise the ordinance for November 8, 2012 at 7 PM. Motion is seconded by supervisor Flansburg and carries with all in favor.
Mr. Bostinto said in order to make up $82,000 which is two mills. You would need $8.2 million in gross receipts questioning if WestfallTownship as a whole would generate that sort of business. The board said there are other things such as the transaction tax that was taken off the table tonight. That may help to reduce the millage. Discussion followed. Mr. Jones said we would not even generate ½ mill , questioning if it will be worth it.
Public hearing closed at 9:21 pm on a motion by Vice-Chairman Fischer. Motion is seconded by Supervisor Melvin and carries with all in favor.
Lisa A. Green, Secretary