Swarthmore Borough cancels income tax proposal following financial support from Swarthmore College.

Swarthmore Borough has decided to postpone a proposal for an earned income tax, thanks to a financial contribution from Swarthmore College aimed at addressing a funding shortfall. The decision comes in the wake of the recent closure of Crozer-Chester Medical Center, which has significantly impacted emergency service operations and expenses in the area.

Under a recently approved memorandum of understanding, Swarthmore College will provide 8,000 to the borough to alleviate escalating costs associated with emergency services. This financial assistance negates the need for an earned income tax, a move that had been met with resistance from both residents and borough council members.

In a communication to the community, Swarthmore College’s Vice President for Finance and Administration expressed satisfaction in collaborating with the borough to avert the introduction of a new tax on College employees. The college reaffirmed its commitment to its partnership with the borough and its dedication to supporting the community.

A presentation made by borough officials last month indicated that the implementation of a 1% earned income tax could generate approximately .13 million during its second year of collection. This amount would include an estimated 0,000 to .5 million in taxes sourced from nonresidents employed in Swarthmore. It is important to note that an earned income tax primarily applies to salaries, wages, and tips, and excludes passive revenue sources like interest, dividends, capital gains, pensions, and Social Security benefits.

The borough’s financial landscape has shifted dramatically following the reduction in ambulance services provided by Crozer, which has increased both operational costs and decreased revenue streams. Following the closure of multiple medical facilities in the region, including Taylor Hospital, the borough declared a disaster emergency in April, which underscored the urgent need for addressing emergency service challenges that arose from the closures.

Public safety expenses are projected to rise by an alarming 41% next year, increasing from .1 million to .3 million. This surge is attributed not only to diminished ambulance services but also to the escalating costs of fire equipment repair and a decline in volunteer firefighters, complicating the borough’s financial management.

Borough officials acknowledge the strain of general inflation on community services, and while the earned income tax is currently on hold, discussions are underway regarding the potential implementation of an emergency services tax—myriad options remain as the borough continues its budget discussions, set to occur during the finance committee meeting on October 27.

The fiscal challenges faced by Swarthmore illuminate broader issues of sustainability in local government operations and the imperative to dynamically adjust funding strategies amid a changing healthcare landscape.