Budget Questions Linger as November Approaches

October 28, 2020

WARREN, Pa. – The kids may get the treats on Saturday, but the COVID-19 pandemic is playing tricks with municipal budgeting this year as the calendar turns to November.

Lost revenue, delayed collection reports and general uncertainty has made budget planning more difficult. The delay in Earned Income Tax numbers, especially, is causing major issues.

“The township relies on earned income tax,” Pine Grove Township Chairman Carmen Ferranto said during the township supervisors meeting Oct. 14.

With all the uncertainty due to COVID, it was hard to project that revenue, he added. A budget review had been on the agenda for the October meeting, but it was pushed to November to allow more time for those numbers to come in.

EIT reporting delays are also affecting the City of Warren.

“I can’t tell you how much we’ve lost in Earned Income Tax because the collections were delayed,” City Manager Nancy Freenock told Your Daily Local in an interview. “And I’ve talked to other managers in the northwest sector of the state and we’re all waiting, and we can’t understand why it hasn’t hit yet.”

At this point, the city is operating under the assumption there will be between a 10 and 30 percent decrease in revenue.

“We already know our loss in liquid fuels revenue is 10 percent,” Freenock said. “We’re looking at the revenues with an eye toward about a 25 percent decrease.”

Even without exact EIT figures, Freenock said the city has already seen revenue loss due to other factors from the COVID-19 pandemic.

“We did see a loss in parking revenues,” Freenock said. “There were no swimming pool revenues and ambulance revenues are going to be a little bit hard to calculate only because the company that we use to do our ambulance billing last year is not the same company that we use this year.”

According to Freenock, the loss in parking revenue was at approximately $19,000 through September. Keeping the pool closed all summer likely resulted in a net savings of approximately $20,000, but that was countered by a loss of between $20,000 and $25,000 after losing the summer playground program.

All the lingering questions mean department heads will be forced to decide what projects are vital for the upcoming year.

“I think all of the department heads, this is my ninth budget here, have always been very good about not asking for things they don’t really need, and sometimes not asking for things that they do,” Freenock said. “I think we have a really good staff and they’re very concerned. We look at this as though it’s our own money because, to some extent, it is.”

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