No property tax hike in Harmar; supervisor calls for tax break in future for homeowners

While the Harmar supervisors passed its $2.7 million budget for next year with no real estate tax increase, one supervisor wants to pass a tax break to township property owners in the future.

The 2021 budget includes typical increases for salaries and benefit expenses for its 17 employees, said Ian Fitzgerald, township manager. The most notable employee expense is a 20% hike in health insurance shouldered by the townshipd.

In the capital improvements budget for next year, the township has matching grants and will have to kick in money for several projects: paving Low Grade Road for about $24,000; restoration work on Little Deer Creek for about $27,000; and buying a police car and a public works truck for a total of about $60,000.

On the revenue side, township officials are concerned about the loss of earned income tax because of the impact of the covid-19 pandemic on residents’ salaries, Fitzgerald noted. Also, money from the state for the township’s liquid fuel tax fund continues to decrease, he said.

Since the township has a projected reserve of $1.6 million at the end of 2021, Supervisor Bob Exler is calling for an increase in the Homestead Act exemption that benefits homeowners.

A homestead tax exemption reduces the assessed value of homes for calculating property taxes. The township has approved these property tax savings in previous years.

“The reserve balance is large enough that we easily handle a decrease in real estate tax revenue via the Homestead Act for residents,” Exler said.

Fitzgerald estimated that Exler’s proposed increase in the Homestead Act exemption would cost the township about $15,000 in revenue. Exler estimated that, if enacted, the average homeowner in Harmar would save $17 annually in real estate taxes.

Other supervisors don’t agree with offering the tax break.

Supervisors Chairman Bob Seibert, Jr. said he is in not in favor of the tax break because the 2021 general budget fund called for a deficit over $200,000. He said the board could reevaluate it next year.

Supervisor Harry Lenhart wasn’t keen to the tax break currently because of the uncertainty of the financial impact of the pandemic. Lenhart said he supports the idea in principle but not at this time.

Although the 2021 budget passed unanimously without the increase in the Homestead Act exemption, Exler said he plans to continue to push for the tax break in the future.