Allentown Finance and Budget Committee Meeting - January 28, 2026
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Allentown Finance and Budget Committee Meeting - January 28, 2026
This meeting of the Allentown Finance and Budget Committee on January 28, 2026, featured a detailed presentation of the city's December 31, 2025 monthly and quarterly financial reports by Finance Director Patel, followed by an in-depth discussion of the annual budget process, revenue challenges, and potential collaboration between the administration and city council.
Finance Reports Presentation
- Finance Director Patel presented the December 31, 2025 monthly and quarterly capital reports. General fund revenues came in at $152 million, 4% above the $146 million budget, driven by stronger earned income tax, business privilege tax, permits and licenses, EMS transit fees, and investment income. Expenditures were at 96% of budget ($146.8 million), with personnel costs at 73% of expenditures. Public safety spending exceeded budget: police at 118%, fire at 122%, EMS at 143%. The risk fund was at 103% of budgeted amount. The solid waste fund showed revenues at 101% ($23.9 million) and expenditures at 90% ($22.1 million), with potential for vendor payment timing adjustments. The building code fund (new in 2025) showed revenues at 158% above budget ($4.2 million) due to billing timing. Cash balance for the general fund was $40.3 million. Investment activities yielded $3.2 million for the year, with $12.1 million in PLGIT prime yielding 3.91% APY and $35 million in term investments yielding 3.74%-4.35% APY. Capital expenditures for Q4 were $2.4 million, year-to-date $12.7 million, with $7.8 million encumbered.
- Committee members asked about solid waste fund expenditure timing, the breakdown of building code revenues (commercial vs. residential), and the average term of investments (Patel confirmed investments are structured to mature monthly based on cash flow needs).
Discussion on Budget Process
- Finance Director Patel outlined the annual budget timeline: begins in June with position budgeting, department guideline emails from the mayor, July budget entry in Munis, August analysis and meetings with department heads, September mayor review and alignment, October proposed budget to council (due Oct 15), council meetings and amendments through December, with adoption by December 31 (changed by 2019 voter referendum). The current year started with a $15 million general fund gap that was closed during the process.
- Patel expressed desire for earlier council collaboration, noting that the 3.96% property tax increase was proposed by the mayor without prior council input. She stated, "I would have liked the support from council at that point, having meetings with them to say what we can do."
- Committee members discussed exploring new revenue sources beyond the limited options under the Home Rule Charter (e.g., real estate tax, earned income tax, deed transfer tax, local services tax). Council Member Garlock suggested a committee to investigate entertainment taxes, impact fees, and cost savings for low-income residents, including possible rebate programs for all income-qualified households (not just seniors/disabled).
- Council Member Atha supported exploring entertainment taxes, stating Allentown has more entertainment venues than Easton or Bethlehem and that such taxes could lower property taxes. Controller Glazer cautioned that the Neighborhood Improvement Zone (NIS) prohibits taxing events at PPL Center and the Archer, and that poking that bear could risk losing the NIS entirely. He noted the NIS has provided significant property tax gains (e.g., Moxie property now paying $33,000/year vs. $4,000 before). He supported a committee to explore other sources but doubted any would be a "home run."
- Council Member Pungo (Chair) emphasized the need to examine both revenue and spending cuts. Committee agreed to continue budget process review at the next meeting, including looking at other municipalities' practices.
- Patel also addressed a previous ordinance that reduced the penalty for late property tax payment from 10% to 5%, benefiting 2,800 property owners with city savings of $95,500. The property tax/rent rebate program saw claims increase 125% from 2024 (36 claims) to 2025 (81 claims) after outreach. Lifting the age requirement was discussed but deemed administratively challenging due to household income verification; Patel is open to partnering with community organizations.
Key Outcomes
- The committee received the December 31, 2025 financial reports and will continue to track updates as vendor payments are processed.
- A consensus emerged to form a committee or working group to explore alternative revenue sources, with Council Member Garlock and Ms. Atha strongly supporting this. The committee will discuss structure and timing at the next meeting.
- Finance Director Patel committed to earlier council engagement in the 2026 budget process, ideally in August-September, to discuss priorities before the proposed budget is finalized.
- Patel noted her administrative priorities: implementing the HR/payroll module in Munis (July go-live), controlling healthcare costs, and managing capital projects including the police headquarters groundbreaking (March) and general obligation bond issue.
- The meeting was adjourned.
Meeting Transcript
I guess we could start with role. I guess can I just call it based off of who's in the room or I'm just going to earn everybody's present. Thank you. So I guess we'll start with uh Ms. Pathel. Could you please uh feel free to start us off with our finance reports and different reports that we have? Sure, absolutely. Good evening, everyone. Um so there's um I know um just want to walk you through that monthly finances are uh presented to council and the controller uh 15 days after the month is over, and uh um so every month you'll be presented with the monthly finances. And I also today have uh quarterly capital report, which is um presented after each quarter and the same um concept that 15 days after the month is over, um the quarterly report is presented as well. So in the quarter ended, uh so we are looking at today the December uh thirty-first, twenty twenty-five monthly and quarterly reforms. I'll walk you through some of the numbers. The reports were provided to you, and my memo that explains the numbers was also provided to you. Um I'll walk you through uh the um journal fund numbers. So general fund uh revenues were budgeted um at uh a hundred and forty-six million, they can they came in four percent better at 152 million, and uh what contribute the um revenues uh contributors were the earned income tax came in um stronger than uh what we had budgeted at. Um business privilege tax also was a contributor uh along with uh permits and licenses. Uh EMS transit fees uh came in much stronger as well, and uh investment income, the um uh uh financial markets were performing well, and uh our returns were higher than what we were we had budgeted. So that's um what contributed to a higher revenue for the general fund. Um I I have a breakdown for you on page two of the memo. It walks you through the uh the percentage uh where uh do the what are the higher uh contributors for the general fund revenue. Um so 70 percent of our revenues are generated from taxes, different various taxes, and that breakdown is that city real estate tax um for this version one report came in at 38.6 million. Earned income tax is at 45 million, business privilege tax at twelve point seven million, and deed transfer tax at two point four million. And the 14 percent, uh other 14 percent revenue came from intergovernmental sources like grants, state aid, uh casino fees, uh, fire and police training. And I have a um pie graph there for um processing for you as well. Next I have the general fund expenditures. Uh they total at ninety-six percent or uh 146.8 million. Uh we had budgeted net of vacancy factor 152 million. Our um so if you look at the pie chart, you'll see that our highest expenditure is personnel. It came in at 73%. And you'll see that savings from the 96%, so savings of 4% is realized from services and charges and materials and supplies. Public safety we budgeted one amount. So public safe safety, police, fire, and EMS numbers are provided there for you. Any specific details that department heads can expand on. But the numbers came in at police was 118% of the budgeted amount, fire came in at 122%, and EMS at 143%. Amongst all of them, my concern is the risk fund, which it came in expenditures are at 103% of budgeted amount. Um had the first half year of increase in garbage fees. So the new charges took effect from July. So they are the revenues, year to date revenues are at 101% or 23.9 million, and the expenditures are reflecting savings of 10% or came in at 22.1 million. Revenues came in still stronger. They are a 6.2 million. We had budgeted 6 million, and expenditures are much under. We had budgeted 7.7 million, they came in at 6 million. Gulf fund has been performing well since the COVID times. Revenue came in on the target at 2.7 million is what was budgeted. And expenditures are reflecting savings at 2.5 million. That December, we uh generally close the year mid-February or third week of February. So this is the first report for December. We'll have two more iterations, and you'll see some of these numbers fluctuate depending on we might have vendor payments that have not gone through. So the numbers will be updated every month. So you'll see some updates coming as the bottom lines.
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