Home rule is a “viable alternative” to Lancaster entering distressed-city status under Pennsylvania’s Act 47, the Lancaster Chamber says.
In a position statement (PDF) released Thursday, the chamber said that in the absence of feasible alternatives, moving to home rule would align with its pro-business agenda.
Summarizing the chamber’s reasoning, the statement says Lancaster is struggling financially due to outdated state law and that its ongoing structural deficit “impedes the City’s ability to fulfill its essential responsibilities.”
The city’s efforts to lobby state government have been unsuccessful. Moreover, invoking Act 47, municipal bankruptcy, would have major costs, the chamber says: “(B)ankruptcy could cause immediate service reductions, pension cuts, tax increases, infrastructure decay, and long-term negative impact.”
Accordingly, home rule is a reasonable choice, the statement says.
The chamber notes that Lancaster is the county seat and its urban hub, with with 60,000 residents and more than 300 businesses.
City voters will decide Nov. 5 by referendum whether to adopt the charter developed by the Home Rule Study Commission over the past year.
Among other things, it would allow City Council to raise the earned income tax rate above the current statutory cap of 0.6%. (Another 0.5% goes to the School District of Lancaster.)
Proponents say shifting to a higher EIT would yield a more equitable and sustainable overall tax structure. Because it is based on income, the EIT tax base tends to grow organically over time, producing more revenue at the same rate, unlike property taxes, which are tied to fixed assessed values.