Allentown City Council on Wednesday night narrowly rejected a compromise 2026 budget plan backed by Mayor Matt Tuerk that would have increased taxes by around 4% but lowered an increase in the city’s trash fees.

The vote was 4-3 against the plan, with council members Cynthia Mota, Natalie Santos, Ed Zucal and Ce-Ce Gerlach voting against it, and members Daryl Hendricks, Candida Affa and Santo Napoli voting in favor.

Council in November rejected Tuerk’s initial 2026 budget proposal, which would have increased taxes by 3.96% and the city’s trash fee by $140, bringing the 2026 trash fee up to $740 per household. Tuerk and city finance director Bina Patel said the increases are necessary to cover rising costs, including a 5% increase in the city’s trash contract and 3% raises for all of the city’s unionized employees. However, council members who opposed the plan said poor residents could not afford both a trash fee increase and tax increase in the same year.

Tuerk and Patel made the case that their compromise would have a lower impact on the city’s poorer residents, because property taxes are calculated via the property’s assessed value, so those with lower-valued homes would pay less than high-value property owners. On the contrary, every household must pay the same for trash services, they argued.

The budget that council approved Wednesday included the $140 trash fee hike, but does not increase property taxes.

Tuerk’s compromise proposal would have kept the proposed 3.96% tax increase, but reduced the trash fee increase by $50, meaning residents would pay $690 per household next year.

According to Patel, the city’s finance staff calculated that 23,000 out of 26,000 households in Allentown would save money under the compromise proposal, because the tax increase would be offset by the savings in their trash fees. The administration also proposed lending around $2 million from the general fund to the city’s solid waste fund, which would be paid back over a period of five years, to cover the cost of the city’s contract with waste hauler J.P. Mascaro and Sons.

However, opponents on council said they continue to oppose an increase in property taxes, and called on the city to find alternative ways to generate the revenue needed to fund city services.

“I cannot support a property tax increase this year. I made a promise, and if my word means noting, then I have failed in my responsibility as an elected official,” Mota said.

Tuerk, who has previously said he would consider vetoing a budget with no tax increase, said he “has some time” to consider whether or not to do so. Tuerk has 10 days from the passage of the budget to issue a veto.

While the city will be able to “pay its bills,” in 2026, Tuerk said, he is concerned that failing to increase property taxes will lower the city’s bond rating, which measures how reliably the city can pay back its debt. The city’s future bond rating is important because it plans to borrow tens of millions to rebuild the city’s police and fire stations.

If Tuerk opts to veto the budget, his proposed budget with a 3.96% tax increase would take effect next year, unless council holds a meeting to override the veto. Council would need fives votes in order to override Tuerk’s veto.

“I think that City Council took action tonight that has the greatest impact on our most vulnerable residence, in spite of the words,” Tuerk said in an interview with The Morning Call following Wednesday night’s vote. “In spite of what they said, they voted to not increase taxes, but they held our proposed $140 trash fee increase. So the people who will — the bill will be larger for the most vulnerable residents than it will be for the residents of the best equipped to to absorb additional expense. So I’m a little confused by the action that they took. I think it’s further evidence of their fundamental misunderstanding of government finance.”

Tuerk said he hopes that the new council members who will be sworn in next year will be more open-minded to small property tax increases in the future.

Newly elected council members Jeremy Binder and Cristian Pungo will be sworn in on Jan. 5, 2025, replacing outgoing members Ed Zucal and Daryl Hendricks.

Reporter Lindsay Weber can be reached at Liweber@mcall.com.