Legislators asked to consider 5 property-tax reduction plans

Now the real fun begins.

An informal group of state senators and representatives tasked with the tricky mandate of coming up with a plan to eliminate or lessen the impact of school property taxes has presented five competing plans for consideration.

Getting the General Assembly to agree on major legislation and have it carry over to get the governor’s signature has been problematic since 2015 when Republicans took significant control of both houses, and the Democrats won the governor’s mansion.

Although the Democrats made slight legislative gains, and Democrat Gov. Tom Wolf was re-elected in 2018, the political dynamics have not shifted much.

So when it comes to an electrically charged topic such as school real estate taxes, I am reminded of actress Bette Davis’ famous words in the 1950 film All About Eve: “Fasten your seat belts; it’s going to be a bumpy ride.” (Actually, Davis said “night,” not “ride,” but the latter has become the popularized word.)

The so-called “gang of 12” — seven House members and five from the Senate — have been huddling for months. They have heard from tax-relief and fiscal experts, along with those who have a vested interest in how this all plays out. They conducted a public hearing during the summer in Harrisburg to hear voters’ opinions.

They got an earful, especially from senior citizens, who have been leading the charge through their representatives to lessen their financial property tax burdens in retirement.

Tarah Toohil, a Republican Luzerne County representative who is part of the task force, recounted the sad story of a 90-year-old constituent who lost her home because she could no longer afford to pay her school real estate taxes.

Other legislators, including the task force’s leader, Sen. David Argall, R-Schuylkill, have been bringing similar heartbreaking stories to these meetings. For Argall, who has been leading this fight for years, he is especially concerned since his district has a disproportionate number of senior citizens who rely mainly on Social Security income to keep going.

In 2020, Social Security recipients will receive an ultra-modest 1.6% increase. Most can count on a larger increase in school taxes during the 2020-21 budget year to say nothing of possible county and municipal increases.

We all owe a debt of gratitude to Argall, who could have thrown in the towel after a proposal to eliminate school property taxes completely nearly passed the Senate in 2015. The vote in the upper chamber was 24-24, and then lieutenant governor and Senate president, Democrat Mike Stack, cast the tiebreaking vote to doom the legislation, claiming it was faulty and, basically, unworkable.

Other local legislators on the committee are Sen. Lisa Boscola, D-Northampton and Lehigh; Sen. John Yudichak, I-Carbon/Luzerne, and state Rep. Peter Schweyer, D-Lehigh.

There are still holes in some of these five proposals, especially when it comes to coming up with funding mechanisms. And, as you might imagine, while some of these plans might please our senior citizens, there are others who will get hit with significantly higher state income tax payments, and everyone would pay higher sales taxes, so, I assure you that whichever plan Republican legislative leaders decide to promote, it will be no slam dunk.

Not only that, but look for the lobbyists and special interests to come out of the woodwork and put pressure on legislators to do this or that.

Here are the plans:

• 1: Reduce school property taxes by $8.62 billion and raise the personal income tax from 3.07% to 4.07% and the state sales tax from 6% to 7%. Some jurisdictions, such as Philadelphia, already pay more than 6%. Theirs also would go up 1%.

• 2: Reduce school property taxes by $6.4 billion. Funding sources are still being calculated. This plan calls for curtailing $400 million in school spending. (This proposal is sure to fire up the Pennsylvania School Boards Association and the American Federation of Teachers, which were among 50 special-interest groups to oppose the 2015 bill.)

• 3: A rebate program would give $2,340 in tax relief to owner-occupied homes. Funding sources are still being calculated.

• 4: A rebate program that would give up to $5,000 in tax relief to owner-occupied homes. Funding sources are still being calculated.

• 5: $8.5 billion to eliminate all school property taxes for owner-occupied homes. Funding would require an increase in the state income tax from 3.07% to 4.82% and a 1% increase in the state sales tax. (This is similar to the 2015 bill which nearly succeeded.)

Bear in mind that none of this affects the current system of taxation for counties and municipalities.

By Bruce Frassinelli | tneditor@tnonline.com