In an effort to generate money for essential services, Petersburg voters will be asked this fall whether to impose income limits for the community’s senior sales tax exemption. That’s after the Petersburg Borough Assembly approved the proposal on Monday, June 16.
The change would limit the decades-old exemption to only low-income seniors who qualify for the state’s Senior Benefits Payment Program, with annual incomes below $34,213 for individuals or $46,253 for couples.
Revenue from Petersburg’s 6% sales tax helps fund local services like public safety, infrastructure, and the school district. But officials say the borough is facing financial strain as service costs rise and sales tax revenue declines, due in part to the loss of federal school funding and an increasing senior population.
The borough issues sales tax exemption cards to senior citizens who apply and pay a $100 fee. They must be at least 65 years old and live primarily in Petersburg to qualify. Seniors who choose to get their individual sales tax exemption card need to have it with them to use it. Card holders can use it on most purchases, except for purchases or services meant for trade or business.
Nearly a quarter of Petersburg’s residents are seniors, and more than 10% of the year-round population of roughly 3,400 are senior exemption card holders. The borough said it loses nearly half a million dollars a year in tax revenue from the senior sales tax exemption.
According to the low-income limit proposal passed by the assembly Monday, this change would bring an estimated $350,000 to $400,000 into the borough, “while ensuring the exemption benefits those most in need.”
Petersburg’s municipal code requires voter approval for any changes to tax exemptions. One prior effort to limit the senior sales tax exemption encountered significant pushback. The borough considered sunsetting the senior sales tax exemption in 2018. Assembly Member Jeigh Stanton Gregor said on a live radio show Monday that despite support from the assembly, the idea was “utterly demolished” by Petersburg voters who rejected it by a wide margin.
“One of the big pieces of feedback we heard on why, and I think it made sense at the time, was it didn’t have any protections for low income seniors,” said Stanton Gregor.
He noted this present-day proposal was “crafted with that in mind.”
Stanton Gregor said accounting for residents whose annual income is slightly above that threshold set by the state becomes a kind of “moving target” for the borough.
“Someone’s always going to be left out,” he said. “[That’s] a concern I’ve heard from people I’ve spoken to … and I think that’s a very, very fair argument.”
He noted the state has a long-established model for vetting incomes and determining the threshold.
At an assembly meeting in May, Borough Finance Director Jody Tow said relying on the state would make the process “simple.”
“So all we’re going to have to do is see a letter from the senior that says, ‘Hey, I qualify for this.’ And then we can give them a card,” Tow said.
The change could dramatically shrink the number of people who qualify for the senior sales tax exemption. There are currently 477 senior exemption card holders in Petersburg, and only 61 seniors are currently enrolled in the state program, Tow said. But she noted that the change could lead more Petersburg residents to apply.
“I have a feeling that if this is tied together and it’s approved, that we’ll have more people that apply for the senior benefits program,” said Tow. “The senior benefit program isn’t a lot of money, but it’s something and seniors could benefit from that as well.”
On Monday, Assembly Member Bob Lynn explained that the assembly could adjust the rules later if needed to address potential backlog in the state’s approval process, which is supposed to take no more than a month.
“If there needs to be an adjustment … we would not have to go back to the voters to do that,” Lynn said during the Monday night assembly meeting. “We have the ability to make changes, if needed, at a later date … I’m quite satisfied with [that ability].”
Stanton Gregor made the motion to pass the proposed change to the town’s senior sales tax exemption, with a second given by Assembly Member Scott Newman. The assembly approved the move unanimously in a 5–0 vote, with Mayor Mark Jensen and Assembly Member Rob Schwartz excused.
Qualified voters of the Petersburg Borough will have the final decision in the October 2025 municipal election.
