EIP Findings

EIP Findings

Early Intervention Program (EIP)

The Early Intervention Program (EIP) provides matching grant funds to assist municipalities experiencing fiscal difficulties to develop comprehensive multi-year financial plans and establish short- and long-term financial objectives.  They help the development and implementation of multi-year financial management programs and strategies.

Clearfield / Lawrence Joint Committee
  • Appointed by Clearfield Borough Council and Lawrence Township Board of Supervisors to evaluate consolidation into new municipality
  • Hired Pennsylvania Economy League as advisor with PA Department of Community and Economic Development Early Intervention Program (EIP) grant
  • Started process in March 2015

Committee Charges

  • Evaluate current municipal operations and services
  • Draft Joint Agreement to create new municipality
  • Draft Home Rule Charter to govern new municipality
Key Financial Findings

Property Taxes

  • Township exceeds 14-mill general purpose state cap at current levy of 16 mills with court approval
  • Township can levy additional 3 mills only with court approval
  • Borough levy is 25 mills for general purpose
  • Borough can levy up to 30 mills plus additional 5 mills with court approval

Earned Income Taxes

  • Both municipalities collect state maximum of 0.5%
  • Local Tax Enabling Act prohibits Borough and Township from increasing this rate

Additional Findings

  • Employee wages and benefits in both municipalities projected to increase annually while revenues are stagnate
  • Both municipalities projected to incur future operating deficits
    • Borough starting in 2016
    • Township starting in 2017
  • Projected deficits will significantly reduce each municipalities’ operating cash balance
    • Borough’s cash balance depleted by 2020
    • Township’s cash balance reduced by $1 million through 2021
  • Employee wages and benefits will continue to increase annually in both municipalities
  • Clearfield near property tax rate maximum and limited room to expand tax base
  • Lawrence over property tax rate maximum but room to grow tax base
  • Uncertainty on future Act 13 revenue

 

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Key Demographc EIP Findings

Demographic indicators show pattern of less wealth in Borough and Township

  • Population decline or stagnation in the age 18 to 64 wage-producing group and the under age 18 future wage-producing group
  • Some growth in Township over 65 population that is usually on fixed income and not earning wages ; decline in Borough over 65 population
  • Median housing values and household income significantly lower than state; grew at slower rate than state
  • Less Wealth = Less Property / Wage Tax Base Growth
  • Blight implications/potential stagnate housing values
    • Owner-occupied housing decline
    • Renter-occupied and vacant housing increase

"What we discovered is by the year 2020 both municipalities will have spent through their reserves and will be operating at a deficit.  So either we cut services or we raise taxes or a combination of both." Alan Walker, Local Businessman