Bethlehem Mayor John Callahan will release his 2013 budget proposal this afternoon and – based on what he told business leaders Thursday – it may contain a tax increase.
Callahan said the city is looking at a possible deficit of $4.8 million in 2013 without some “corrective action,” according to The Morning Call. Nearly $4 million of that shortfall is the result of increasing pension costs.
The city is facing a 55 percent increase in its minimum pension obligation that Pennsylvania requires its participating municipalities to pay each year, the newspaper reported. The city’s obligation rises from $7.2 million this year to $11.1 million in 2013.
In addition to a tax increase, the city is also looking at ways at reducing expenditures and increasing revenue. Five jobs will be eliminated, though none through layoffs, the mayor said at a business leaders breakfast hosted by the Greater Lehigh Valley Chamber of Commerce.
According to The Express Times, the city is also looking at changing its 911 dispatching system and hiring one single contract hauler to carry the city’s garbage – a move that would certainly draw vehement protests from private contract haulers and their supporters.
The mayor will release the details of his budget proposal at 2 p.m. in City Hall.