Tax dispute weighs on supporters of Jim Thorpe’s business, tourism industry

As a tax dispute continues to play out between the Lehigh Gorge Scenic Railway and the borough of Jim Thorpe, the borough’s business community and its tourism agency hope for an equitable solution.

Last week, the railway announced its plan to terminate its relationship with the borough by the end of November because of a tax dispute. The railroad company, owned by Reading, Blue Mountain and Northern Railroad of Port Clinton, offers a round-trip service that carries passengers from a station in Jim Thorpe to the borough’s Lehigh Gorge State Park along the Lehigh River and into Old Penn Haven in Lehigh Township.

The borough views that service as subject to an amusement tax and wants to charge the owner.

The borough wants to impose a 5 percent amusement tax on the railroad owner and 2.5 percent tax for the school district.

In the resolution, the Jim Thorpe Tourism Agency said it hopes all parties can work together for a solution that would be fair to all involved. The agency said the excursion train has run for 15 years out of the Jim Thorpe station and introduces many visitors to the borough and its natural surroundings. The train runs each day, all summer long and typically draws large crowds. In addition, the shops and eateries in Jim Thorpe’s downtown thrive in large part because of the business driven by the railroad, the agency said.

The ever-increasing number of passengers has translated to steady, reliable revenue for the borough’s businesses, according to the agency.

Danny Behan, co-owner of Molly Maguire’s Pub in Jim Thorpe, said his restaurant sits facing the train. If it leaves, it could be a big loss, he said. When the train is packed, so is his restaurant.

“It would just be a catastrophic loss, not only to me but to every other business owner so it would be a great big loss,” Behan said. “Hopefully, they can get to some agreement.”

In addition, the railroad owner cancelled the Santa rides scheduled in Jim Thorpe for December, Behan added.

On Wednesday, Behan hosted a meeting at his restaurant regarding the issue and attracted 31 businesses who showed up to express their concerns.

In an announcement regarding its new train schedule, Reading & Northern Railroad said it received overwhelming support from people throughout the region after it said it would terminate its relationship with Jim Thorpe because of lack of support from borough management.

As it moves forward with its 2020 plans, the company said it would be reaching out to many communities to see how it can bring the joy of railroading to as many people as possible.

The railroad company also runs trains to stations in several areas of eastern Pennsylvania, including Schuylkill Haven, Pottsville and Reading.

Mayor Michael Sofranko and Andy Muller Jr., CEO/owner of the railroad company, did not immediately return requests for comment.