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Pennsylvania's House of Representatives and Senate have different ideas
about how to achieve property tax relief. Some observers look at this
contretemps as just another example of the General Assembly being unable to
do the people's business. I believe that, in the case of the House, this is
not true, and if one takes the time to examine the bill the House has
produced, an effort to help and improve the tax situation for many
communities can be discerned.
The Senate is offering a bill that would bring no state money to the table
at all. School districts would be allowed to cut property taxes, on a
relatively small scale, and then make up those lost revenues from other, new
or existing, sources of local taxes.
This allows the Senate to keep from committing what they consider the
ultimate no-no: raising state taxes. Their desire in this regard is so
strong that they have put forth a fraud. It is the legislative equivalent of
Chinese food: it gives the appearance of providing tax relief, but if you
wait awhile, you will find you are paying the same, or more, only with a
different name to the tax.
Folks, let me tell you, if a poor community has low property values that
require it to tax itself hard in order to run its schools, there is no
chance that it will have the kind of local personal income that will let it
do the job with less strain on its collective wallet than in the current
system of taxing real estate. But the Senate's game of three card Monte
requires that you believe adding zero to zero will produce a positive sum.
The House bill is commendable for several reasons. The first is the process
that was used to bring it forth. The House leadership apparently heard the
criticism about the way major legislation has been developed without all
members having a chance to participate, as well as the practice of gutting a
bill that has had its required third reading and dropping, perhaps,
controversial new language into it. Presto, a new bill ready for passage
that almost no one ever heard of before.
The House response was to hold an open session where all representatives
could be heard. Out of what looked like a New England style town meeting,
held in a very fancy room, came the elements of the bill the House
eventually passed. It would still require that school districts proposing to
increase taxes beyond a percentage established by an index, must ask voter
approval by means of a referendum, but beyond that it goes into territory
the General Assembly has not seriously addressed in decades.
This brings me to the second commendable feature of the House bill. A
majority of House members have acknowledged, by vote, that the Senate bill
is deficient in its requirement that new tax revenues come only from local
sources, and that new money from state raised levies must be in the mix if
districts with both low property values and low personal income are to be
helped in the process of lowering property taxes.
The House bill would not raise the state sales tax but would broaden it to
include certain nonessential items and services. It would also raise the
state personal income state 0.22 per cent, from 3.07 to 3.29.
While no one, most of all legislators, enjoy seeing state taxes go up, the
choice is clear. Either pay additional local taxes or pay additional state
taxes if you want to see property taxes go down. There is no other way to do
it without doing unbelievable damage to our state's most valuable asset: its
public schools. Without even contemplating the tragedy that would be for our
children and communities, how attractive does anyone think the Keystone
State would be new business and industry if that were to occur?
The third remarkable and commendable feature of the House's bill is the
member's courage and seeming understanding of the above situation and
conditions, in voting out this legislation. It was a genuine pleasure for
me, cynical from 30 plus years of being part of Capitol Hill activities to
hear the representatives talk, with feeling, about how to address the needs
of the people of Pennsylvania.
The fourth is that, should the House bill become law (although we are some
way from that), we will have the opening of a door through which we could
begin to address the major unaddressed priorities in school funding: equity
and adequacy.
Although the current legislation, both House and Senate, address only the
use of new local or state money to provide property tax relief, the House
bill, by acknowledging the need for the state to bear a larger part of this
burden, also acknowledges that by spreading that burden amongst all our
citizens, we can more responsibly distribute the revenues. While this is
received knowledge among those who live inside piles of spreadsheets of
fiscal data, it is something that is horribly hard to have dealt with by the
General Assembly.
I can only hope, for the sake of our children, and ultimately our state
itself, that this historic first step is not the last.
Joseph Bard is the Executive Director of the
Pennsylvania Association of Rural and Small Schools |
