Could the municipalities of Chester County use an additional $4.8 million dollars per annum? Or the school districts about $800 thousand in additional funding? If so, consider the attached resolutions for adoption by townships and boroughs and forwarding to SEATO@ccato.org. (SEATO - Southeast Association of Township Officials - essentially Bucks, Chester, Delaware and Montgomery Counties).
The resolutions address the 1932 Sterling Act which allowed Philadelphia to tax income both at the "resident" and "source" levels. Each municipality in Chester County may tax income for their resident's earnings regardless of source; however, they do not tax non-residents for income earned within the municipality - that tax is at wage earner's respective residence. Philadelphia taxes as the "income source" for non-resident city workers and is essentially preempting the standard resident tax for suburban municipalities. Chester County's Sterling Act shortfall was $4,800,357 at the municipal level in 2014. Bucks county over $60 million. School district shortfall is mitigated by payments made by the Commonwealth to compensate for a portion of their shortfall.
The constitutional issue in the essay cited below is related primarily to the impact in New Jersey arising in the US Supreme Court -- Comptroller of the Treasury of Maryland v. Wynne.
CCATO urges your municipality considers and passes the appropriate attached resolution. Once passed email an executed copy to SEATO@ccato.org and we will handle the forwarding to legislators and the Governor.
SEATO conducts a monthly conference call with the Pennsylvania State Association of Township Officials and this topic has been jointly addressed and concurred as an important issue over several sessions with the conferees.
- Resolution for Township adoption
- Resolution for Borough adoption
- Chester County Sterling Impact per municipality in 2014
- Penn Law Essay: Is the Philadelphia Wage Tax Unconstitutional?
- Thinking Beyond Today: A Path to Prosperity
- The Sterling Act of 1932
- House Bill 2256
- House Bill 2257
- House Bill 2142