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Homes, Homeowners, Properties, Neighborhood

“Property Tax Independence Act” Updated for New Session

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The push to eliminate school property taxes in Pennsylvania isn’t going away; supporters say it’s growing stronger.  A bipartisan group of state lawmakers gathered in the Capitol Media Center, Tuesday, to unveil the latest version of the Property Tax Independence Act, and state Rep. Jim Cox (R-Berks) is leading the charge for the second consecutive session. 

“This is what it would take to fully replace school property taxes once and for all,” Cox said while clenching a penny between his thumb and index finger.  “This is what stands between Pennsylvanians and the ability to completely eliminate school property taxes, and the ability to own their own homes.” 

What’s being proposed is actually a dollar-for-dollar replacement of school property taxes.  Here’s what it would take:

A one penny increase in the state sales tax (from 6 to 7% in most counties)

A broadening of the sales tax base  

A 1.27-percentage point increase in the state personal income tax (from 3.07 – 4.34%)

"How can you let a penny stand in the way of getting the job done?" - Rep. Cox at Tuesday's news conference.

“How can you let a penny stand in the way of getting the job done?” – Rep. Cox at Tuesday’s news conference.

Rep. Cox believes this shift in taxation will spread out the school funding burden much more fairly, and result in more disposable income in Pennsylvanians’ pockets. 

The biggest difference from last year’s plan is in the personal income tax rate.  The earlier version would have only raised it to 4.01%, but it was adjusted after an analysis from the Independent Fiscal Office determined last year’s version of the bill would have resulted in a revenue shortfall. 

“We now have an independent verification that the numbers simply do add up.  This is revenue neutral legislation.  We have the facts to prove it.  A dollar-for-dollar match to fund our public schools,” explains Sen. David Argall (R-Schuylkill) who’s sponsoring a companion bill in the Senate. 

Adjusting for the IFO analysis has taken one of the key complaints off-the-table: fear that it would raise insufficient revenues.  However, past concerns have also focused on the free pass the tax shift would give large businesses and whether sales & income taxes are as stable as property tax revenues. 

The House and Senate bills are expected to be referred to their respective Finance Committees.

RadioPA Roundtable

Radio PA Roundtable 08.17.12

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On this week’s Radio PA Roundtable, Brad Christman and Matt Paul update you on Pennsylvania’s Voter ID law, now that the Commonwealth Court has issued a key ruling; Matt talks to a state lawmaker about property tax reform; and we have new poll numbers on the presidential race in Pennsylvania.

Radio PA Roundtable is a 30-minute program featuring in-depth reporting on the top news stories of the week.

Click the audio player below to hear the full broadcast:

[audio:https://s3.amazonaws.com/witfaudio/radiopa/Roundtable08-17-12.mp3]
Houses, Housing, Property Taxes, Street

Select Committee on Property Taxes to Meet on Monday

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State House leaders have tapped a select committee to study property taxes, under a resolution that passed with broad bipartisan support before lawmakers’ summer break.  Monday marks the group’s inaugural meeting, but its final report and recommendations won’t be due until the end of November.

“We really look at that report as a way to set the table for the 2013-14 legislative session, as a way to move forward to try to address this issue,” says Rep. John Quigley (R-Montgomery), who sponsored the legislation and sits on the new select committee.

Quigley introduced the resolution in early June, after the Property Tax Elimination Act was tabled in the House Finance Committee. His district office was soon swamped with calls.  “It certainly has been quite a buzz in the Berks, northern Montgomery, northern Chester County area,” Quigley says.

The 13-member panel is comprised of seven Republicans and six Democrats.  It will be investigating local and county property taxes in addition to the school district property taxes, which make up the bulk of the burden.

Details won’t be hammered out until Monday, but Quigley estimates that the select committee may call three to five public hearings.

Homes, Homeowners, Properties, Neighborhood

Property Tax Elimination to be Discussed at Capitol Hearing

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Taxpayer groups from across Pennsylvania are rallying behind the latest attempt to abolish burdensome school property taxes.  The newly-introduced Property Tax Independence Act would replace homeowners’ most dreaded bill with a one percentage point increase in the state sales tax, a broadening of the sales tax base, and a hike of the personal income tax from 3.07 – 4%.

It’s a dollar-for-dollar tax shift, and the bill’s author says the number of losers is extremely small.  “What this does is shift the [school funding] burden off the backs of six million property owners, up to the shoulders of 12-million sales tax payers,” state Rep. Jim Cox (R-Berks) tells Radio PA.  “Everyone pays the sales tax.  How much is largely up to them, but everybody pays the sales tax.”

One difference between HB 1776 and previous attempts to thwart the local property tax is the unprecedented level of input it received from Pennsylvania taxpayers.  In fact, the Property Tax Independence Act has the backing of 72-taxpayer groups.

“This is about all homeowners who are suffering under the burden of school property taxes,” says Pennsylvania Coalition of Taxpayer Associations spokesman David Baldinger.  “In some areas of the state, the monthly property tax escrow can be equal to the mortgage itself.”

Baldinger is among the testifiers scheduled to address the state House Finance Committee on Monday morning.  While enactment of such a dramatic change would be nothing short of monumental, Rep. Cox believes he already has enough votes to advance the bill out of committee and to the House floor.

HB 1776 has 70-cosponsors, 50-Republicans and 20-Democrats.  There’s also a companion bill in the Senate.

Five Years of Casino Gaming in PA

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The slot machines first started chiming, whizzing and whirling at Mohegan Sun at Pocono Downs on November 14th, 2006.  Back then it was Pennsylvania’s first slots casino.  Today Mohegan Sun is one of ten casinos operating in the Keystone State, which are all offering a full complement of table games too. 

Casinos, Cards

PA casinos started rolling out table games in July 2010.

The first five years of casino gambling have been an economic success, according to state Sen. Tommy Tomlinson (R-Bucks).  “Many of my detractors said you’ll never raise a billion dollars out of this, but we’ve gone over $4-billion dollars in tax revenues to the state,” Tomlinson says.  Slot machines have actually raked in $4.6-billion dollars in tax revenue through last fiscal year, and table games added another $81.4-million dollars in tax revenue during their first year. 

Regardless of the statistics, state Rep. Curt Schroder (R-Chester) tells us casino gambling has failed to deliver on its promise of property tax relief.  “Maybe a couple hundred dollars in some places, in some parts of the state much less than that,” says Schroder, who chairs the House Gaming Oversight Committee.  “When you’re talking property tax bills of three, four, five thousand dollar and above in some areas, it doesn’t make a dent.” 

Last year, Pennsylvania homeowners shared in $776-million dollars of slots-funded property tax relief, which broke down to a statewide average of $200 bucks.  The amount varies by school district, though, and Sen. Tomlinson tells us poorer areas and senior citizens are especially benefitting.      

PA casinos employ 15,000 people, but there are concerns about potentially thousands of families being negatively impacted.  Five years ago, the Council on Compulsive Gambling in Pennsylvania averaged around 300 calls per month to its helpline.  “Since the first casino opened in November of 2006, our monthly helpline activity has increased,” says Council on Compulsive Gambling President Jim Pappas.  “We now average over 1,800 calls a month from within the state.”  3,025 people have also signed up for the Pennsylvania Gaming Control Board’s self-exclusion list.

Several more casinos could potentially come online in 2012, but the Gaming Board’s focus is shifting.  “It really is coming to the point where we’re becoming more of a regulator than an opening-type agency,” says PGCB spokesman Richard McGarvey.  While the gaming competition from surrounding states will be intense in the next five years, McGarvey says PA casinos are already responding with increased amenities.  “You’re now starting to see these casinos starting to add hotels, shopping centers, bowling alleys… That’s the direction they’re heading.”