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In this Email Update:
Much of the attention in the first week of state budget hearings is in relation to the governor’s proposed increases to the sales and income taxes in exchange for temporary school property tax relief.
The hearings also focused on the plan I am sponsoring on behalf of over 80 taxpayer associations from across the state.
The issue of property tax reform is a bipartisan issue. I remain hopeful that the legislature can approve our forthcoming proposal to eliminate school property taxes and the governor will sign it.
I asked that very question to Budget Secretary Randy Albright during our hearing with the Governor’s Budget Office on Monday. Watch my question here.
Following-up to my question, Senator Mario Scavello (R-Monroe) spoke about how many Monroe County residents pay more in school property taxes than they do in their mortgage payments. Secretary Albright responded by stating, “The crushing burden of school district [property] taxes in many communities is a challenge to households and a challenge to their local economies.”
During the hearing with the Independent Fiscal Office, I asked how long it would take for the temporary property tax reductions in the governor’s plan to return to their current levels – you can watch that question here.
One of my colleagues, Senator Randy Vulakovich (R-Allegheny), brought to my attention that the state leases property despite the fact that the state owns vacant property. My goal is to save tax dollars by eliminating state leases and move state employees into offices that are currently owned and unused by the state. I asked the Acting Secretary of the Department of General Services, who handles the state’s facilities, about the issue.
My concerns with the governor’s proposal are clear: taxpayers would trade increased income and sales taxes in exchange for a temporary school property tax reduction. Republicans and Democrats agree: school property taxes are a problem. We need to work together to put a package together where taxpayers win. I outlined my position and concerns in an op-ed I wrote earlier this week – see below.
By: Senator David G. Argall (R-Schuylkill/Berks)
Many local football fans have watched their favorite NFL team make numerous trades and acquisitions over the past two weeks. Some of those trades leave fans scratching their heads and wondering what the front office is doing to help the team get to the Super Bowl.
Two weeks ago, I heard a similar reaction from local residents to Governor Wolf's trade offer to give Pennsylvanians permanent increases in state income and sales taxes in exchange for a temporary reduction in school property taxes—a raw deal for taxpayers.
Over the last several days, his administration tried to tie their property tax “relief” proposal to a plan that was developed over the course of the last several years by over 80 grassroots taxpayer groups across Pennsylvania – Senate Bill and House Bill 76.
The broad bipartisan coalition of individuals that crafted Senate Bill and House Bill 76 deserves a lot of credit because they are willing to make a fair trade – eliminate school property taxes in exchange for an increase in income and increase and expansion of sales taxes.
Senate Bill and House Bill 76 raises over $11 billion necessary to eliminate school property taxes by increasing the state’s Personal Income Tax from 3.07 percent to 4.34 percent; increasing the state’s Sales and Use Tax from 6 percent to 7 percent and expanding the sales tax base to cover more goods and services.
The governor’s plan raises $3.8 billion, approximately 34 percent of the current statewide school property tax bill, by increasing the state’s Personal Income Tax from 3.07 percent to 3.7 percent; raising the state’s Sales and Use Tax from 6 percent to 6.6 percent and expanding the sales tax base to cover more goods and services.
Senate Bill and House Bill 76 will kill off the property tax beast altogether so it can never return. The governor’s plan would allow this monster to survive and continue to devour new local tax revenues year after year.
The people in Berks and Schuylkill Counties have given me a simple mission: completely eliminate the hated school property tax that has funded schools since the 1830s. Maybe it made sense nearly two centuries ago, but we need to find a fairer way to fund public schools and remove the heavy, unfair burden on property owners.
Poll after poll demonstrates that the taxpayers of Pennsylvania are unwilling to support the governor’s concept, which only temporarily reduces property taxes. His budget secretary noted that a current state law will limit the growth of property taxes in the future. Just last year, with this law in place, one-third of Pennsylvania’s school districts raised property taxes above the capped 2.1 percent increase. The nightmare scenario would play out in a matter of years: Increased income taxes, increased sales taxes and again, high school property taxes.
The governor is selling his plan as real relief, but as the taxpayers know, his is a trade where they lose. I don’t see any taxpayers excited to make a trade for high income taxes, high sales taxes and eventually high property taxes.
While I’m pleased to see the issue of property tax reform finally getting the attention it deserves, we need to ensure that the taxpayers come out on top of this trade through school property tax elimination, not just a temporary reduction.
Taxpayers in 17 out of 21 school districts in 29th Senatorial District “losing” under Wolf’s property tax ‘relief’ plan
Under Governor Wolf’s proposed property tax ‘relief’ plan, taxpayers in the 29th Senatorial District would pay over $32 million in additional taxes. Taxpayers from 17 of the 21 school districts would see their overall tax burden increase. The governor is promising property tax ‘relief’ under his plan, however, as you can see, the ‘relief’ comes with a higher price tag for a majority of school districts in Schuylkill and Berks Counties. Furthermore, the property tax reductions realized will only be temporary since there is nothing in place to cap the growth of future school property tax increases.
29th District Total = -$32,386,183
Schuylkill County =
Berks County (29th
District portion) = -$22,766,224