A proposed $3.18 million budget for financially distressed Greenville is available for public viewing. It sets 2003 spending at $120,000 more than this year, holds the line on property taxes and raises the local income tax rate.

If spending holds and all projected revenue comes in, the borough will have $218,000 at the end of next year that council could use to repay its debt, said Councilman David P. Henderson.

"We're spending a lot more," he said, "thanks to the Act 47 money." The Act 47 money is a $660,000 tax-free loan the borough received from the state program for financially distressed communities. Greenville became Pennsylvania's 18th financially distressed community earlier this year.

One piece of good news for homeowners is that property taxes will stay at 31.5 mills. A mill is $1 for every $1,000 of a property's 1970 market value. At 31.5 mills, a home assessed at $15,000 carries a tax bill of $473. One mill brings the borough about $39,000.

"We didn't want to raise the millage," Henderson said. "As a council, we didn't think the town could handle it." Real estate taxes rose 4.6 percent this year, 15 percent in 2001 and 18 percent in 2000.

Although property taxes are unchanged, income taxes will rise.

Acting on advice from the state's Act 47 fiscal recovery plan, council will seek approval from Mercer County Common Pleas Court to raise the earned income tax rate from 1 percent to 1.7 percent for residents and 1.5 percent for nonresidents.

According to the state's study of borough finances, the borough collected $321,964 in resident earned income tax and $572,47 in nonresident taxes during 2001.

At the higher tax rate, council anticipates collecting $641,650 from residents and $238,000 from nonresidents next year.

According to the recovery plan, prepared for the state Department of Community and Economic Development by Resource, Development and Management Inc., council must seek the tax increase: "It is imperative the borough implement (the tax recommendations), since there will be a heavy reliance on the recovery plan placed on the recommendation of both the residential and nonresidential earned income taxes."

"Thank God the Act 47 process is at the stage it is," Henderson said. "If we weren't able to raise the income taxes, we would have to raise the (real estate) millage almost to the legal limit to make ends meet. It would be catastrophic for the town."

Next year's budget was carefully itemized, Henderson said, referring to recent years, when council members have said former Borough Manager Peter D. Nicoloff Jr. restricted their access to financial reports and they had to guess how closely ends would meet.

This time around, Henderson said, council members worked closely with department heads so they could report anticipated spending to Resource and Development employees. Resource and Development is coordinating the borough's recovery plan and helped to prepare the 2003 budget, Henderson said.

"We're in good shape right now," Henderson said.

Unique to next year's spending plan, Henderson said, is a provision for paying down the borough's debt of more than $1.5 million. At least $150,000 of the anticipated excess revenue will be used for that debt, he said.

You can e-mail Herald Staff Writer Amanda Smith-Teutsch at: ateutsch@sharonherald.com

<hr><h2> Greenville budget
at a glance</h2>Here is a breakdown of Greenville's proposed 2003 general fund budget of $3.18 million, with preliminary 2002 figures in parentheses. Actual 2002 figures changed when council reopened the budget after the first of the year.

   » Real estate taxes at 31.5 mills -- $1,248,445 ($979,990)

   » Local enabling taxes -- $984,150 ($528,900)

   » Business licenses and permits -- $68,660 ($46,752)

   » Fines -- $29,500 ($28,515)

   » Grants -- $232,564 ($167,498)

   » Miscellaneous -- $1,000 ($19,511)

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