The 2020 budget for Emmaus passed its first reading at the Dec. 2 Emmaus Borough Council meeting which will bring a 9.61 percent tax increase, or roughly $138, for residents.

The $18.4 million budget, which is a 3.01 percent increase from 2019, will include a property tax millage rise from 5.6654 mills to 6.3154 mills. A mill is a $1 tax on every $1,000 of a property’s assessed value. With this 0.65 mills increase, homeowners with property assessed at the borough’s average of $161,000, will be paying an extra $104.71 in property taxes. An additional $33.64 will be added for sewer rates.

In total, the average Emmaus household will be paying an additional $138.35 in taxes than in 2019.

Borough Manager Shane Pepe said the property tax rose because of payroll, health care costs, pension and workers’ compensation costs.

Payroll increased by $499,205, half of which comes from the 27th pay next year, which occurs approximately once every 11 years. This happens due to the addition of several cumulative calendar days over the span of a decade. This occurrence is costing the borough $231,841.26 next year.

Health insurance for borough employees only increased by 1.11 percent, but the overall health care costs increased by 7.05 percent. That brought the total increase in health costs to $165,414.

Pepe said the largest part of that increase was for the retirees, with an additional $122,599 for retiree insurance. This is due to three public works employees retiring in 2019 and one retiring in 2020.

Pension costs went up by $13,793 for 2020 due to the costs beginning to be offset by higher contributions from employees, “as the nonuniform employees are nearing a contribution of three percent and the police are nearing a contribution of five percent.”

Workers’ compensation had a sizable increase in 2020 due to several reasons - one reason being because of two costly injuries. The fire department is now being paid, so the borough has to continue paying for volunteer workers’ compensation, as that rate is based on community population, in addition to the paid firefighter’s workers’ compensation.

The rate is the same as the police department, so based on their payroll, the workers’ compensation for the fire department increases $14,000.

Also increasing in taxes will be bills directly related to the sewer fund. Homeowners with property assessed at the borough’s average can expect an $11 increase in the sewer infrastructure bill, $5 in the sewer connection bill and $17.64 in the sewer usage bill. This totals an additional $17.64 a year in sewer bills.

Pepe said council cut as much in operating expenses as they could, including the delay of hiring certain positions.

“We cut to the bone, and in some cases, we cut into the bone,” Pepe said. “However, there remain certain needs to operate and certain needs to continue to maintain progress in meeting different mandates and not falling any farther behind on infrastructure.”

The tax increase will only leave $103,660 in allocated funds in the general fund, which is less than one percent and is considered “dangerous,” according to Pepe.

In regard to the sewer rate tax increase, Pepe explained the borough was hit with “several huge costs that were unexpected.”

“We’re seeing the highest sewer flow rate this year than we’ve seen in over a decade and a half, and that’s because of wet weather issues.”

In November of last year, the borough had a major flooding issue on Donald Drive when a pipe that goes down over the mountain to the borough’s pump house and down under the creek burst. “A big concrete pad fell through it and as a result of that, washed out and cracked the line all the way down through the manholes,” Pepe said.

Pepe said they received a quick estimate from a contractor for $150,000, but when the bids came in they were much higher. The project cost $287,000 with an additional $100,000 in engineering costs.

He said they “experienced the bulk of the engineering costs (not budgeted) in 2019, and will pay $120,000 toward the project in 2019, with the balance being paid in 2020.”

Pepe also said they “received a surprise bill from Lehigh County Authority for the Western Lehigh Interceptor.” The bill was $74,350.90 despite the borough being told last November “not to budget anything, as we still had a credit in the account.”

The Western Lehigh Interceptor is a major sewer line that takes waste from the west part of town into Allentown.

“We are also being told that the cost of the Western Interceptor is going from what was supposed to be zero to $119,225 next year.”

The Emmaus Sewer Main will go up from $400,000 to $443,000 in 2020, which is being projected from 2018 flows. “We anticipate that our flows from 2019 will be much worse, meaning the 2021 budget will increase even more.”

Between the Emmaus sewer main and the Western Lehigh Interceptor, the borough’s charges have increased by $236,576 in the span of one year’s time.

Pepe said on average, a single person uses 1,000 gallons of water and sewage per month. Therefore, they calculation for sewage taxes was based on 3,000 gallons a month per household. The census for Emmaus says an average of 2.8 people live in a house, so the borough rounded it up to three people a house.

The total amount of unallocated funds, or “reserve funds” that will remain is $340,863.34 or about 1.8 percent. The typical target amount per budget season is 10 percent.

Pepe said in the 13 years he’s been a borough manager, eight of those being in Emmaus, this one “has been by far the worst budget I’ve ever had to do.”

The budget workshops, which consisted of all department heads and council members, lasted 36 hours in total. Department heads had from July 1 to the middle of September to send their “wish list” to Pepe. From there, council went through over 5,000 pages of information. There were 35 different meetings scheduled.

The final distribution of the budget is as follows: $11,948,993 - general fund, $1,387,465 - fire, $1,200,780 - water, $1,953,016 - sewer, $815,387 - debt services, $512,575 - capital projects and $613,654 - liquid fuels. The grand total is $18,431,870.

The budget will be made available for residents to view for the next 10 days. The final adoption will happen at the Dec. 16 council meeting.