Has the time come to abolish Connellsville's two-tier tax system?
That's a question city council is hoping to answer. Some say the system, which levies taxes at differing rates on land and buildings in the city, is antiquated and does the opposite of what is was designed to do: spur new development in the city.
Council recently passed a resolution to study how reverting to a single-tier tax system would impact a majority of taxpayers in the city. Once the study is completed, its findings will be reported at a special public meeting.
Critics of the two-tier system claim it unfairly targets business owners. The tax adversely impacts business primarily, although residents who own vacant lots are also affected. Under the current system, a business owner pays one tax rate (17.5 mills) on his building and another (113.5 mills) on the land it is situated on and any adjacent land, which in many cases are parking lots.
Vaughn McDiffett, a developer who lives in Connellsville, called for abolishing the two-tier system, saying he avoids developing in the city because of what he sees as a tax unfriendly to business. "There is no incentive to build here," McDiffett said.
Indeed, figures show that a developer would be better off building in one of the townships bordering the city.
James Hercik, director of the Fayette County Tax Assessment Office, told council at a meeting earlier this year that if someone were to purchase a lot in the city for $10,000 and erect a $50,000 building on it, he would pay $2,010 in taxes to the city. The same development in Bullskin Township would yield $147 in township taxes, while in Dunbar Township, the tax bill would be $189. Granted, locating in the city would provide the business owner services not available in the townships, such as a full-time police force, street lighting and sidewalks, but the cost disparity is greater than the disparity in services.
More telling than those numbers is the simple fact that downtown Connellsville is not thriving. The two-tier tax system, implemented in 1992, was supposed to spur development. A host of empty storefronts and vacant lots tell us that hasn't happened.
Would reverting back to a single-tier tax system better boost development in the city⢠That's what the study council will conduct is designed to determine. What is certain is that the current system isn't doing the job. If the study shows a change is needed, we trust council will make the change.
When council holds its special meeting on Dec. 4, it will invite comment from the public, which will undoubtedly include members of the business community. Hercik will be asked to moderate the meeting. We urge the attendance of residents as well as business owners, as everyone will be affected in some way by council's decision in this matter.
