School Property Tax Elimination Bill
What is it?
In 2015, the Senate attempted to pass Senate Bill 76, the school property tax elimination bill. The vote was tied 24-24 and then the Lt. Governor voted no to kill the bill. Many senators would like to bring the bill back up for a vote this spring and implement the plan effective July 1, 2017.
Why is it being proposed?
Legislators hear complaints all the time about people not liking school taxes. Thus, they are trying to find a remedy for their constituents’ biggest complaint. Two of the biggest issues with our current school property taxes are:
· Pennsylvania state government only provides funding for approximately 38% of school budgets. NY, NJ and MD all pay about 45%. This means our state government isn’t paying its fair share compared to its peers, which puts a greater burden on the local residents. PA only funds about 32% of the DV budget.
· Pennsylvania doesn’t have a senior citizen tax relief program like other states. NY state government pays 50% of senior citizens’ school taxes on their primary residence. A statewide program like this in PA would be a huge benefit to our seniors.
What are the details?
Please see the attached PowerPoint that Dr. John Bell, DV superintendent, gave at the February 16, 2017 school board meeting as well as the many documents on the PASBO (Penna. Association of School Business Officials) website. The link is on the last slide of the PowerPoint.
What is the bottom line?
We think tax reform is needed. However, this bill has too many negatives including:
· Taxing Pike County residents more than we will receive back in school funding; Only six areas gain – Philadelphia, Pittsburgh and 4 wealthy Philadelphia-area counties
· Shifting $2 billion in taxes from non-resident property owners to PA residents
· $14 million (30% of all DV taxes) are paid by out-of-state property owners who will now pay no property taxes and won’t see their income taxes increase either