Senator Lisa Baker E-Newsletter

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Enews Update On Efforts To Reduce Or Eliminate Property Taxes

The commitment and perseverance that local taxpayers have shown over the years toward property tax elimination is commendable. I appreciate and share in the feeling of frustration many hold over the failure to get a comprehensive bill turned into law.

The search continues for a configuration that can gain legislative approval and be signed into law by the governor.

Because of the turnover in recent elections, no one has an exact count as to the number of supporters in the state Senate and House, because a vote has yet to be taken this session.

The biggest hurdle has been the opposition of Governor Wolf, which is not expected to subside now that he is serving his second and last term. While there is conjecture as to whether the votes are there for legislative approval, there are nowhere near the votes needed to override the expected gubernatorial veto.

Fortunately, efforts are underway to break this deadlock. The Senate Republican Policy Committee is holding a series of community workshops. This exercise has several purposes: to increase attention to the problem in parts of the state where support has been less than in ours, to possibly sway some of the undecideds or opponents to a position of support, and to see if there are adjustments to the proposal that will attract additional legislative votes.

There is one other significant positive development to report. By virtue of our approving a no-tax-increase state budget, the state tax authority needed to replace local property taxes remains intact and available, should consensus on a plan be reached.

You can be assured that I continue to support this legislation and encourage positive action on it. Thank you for your input and involvement in this critical matter.

Property Tax Proposals

2019-2020 Regular Session

Senate
Senate Bill 76 (Argall): The Property Tax Independence Act – providing for tax levies and information related to taxes; authorizing the imposition of a personal income tax or an earned income tax by a school district subject to voter approval; providing for imposition of and exclusions from a sales and use tax for the stabilization of education funding. I am a cosponsor of this bill.

Last Action: Referred to Senate Finance Committee on Feb. 22, 2019.

Senate Bill 805 (Scavello): This legislation further provides for expansion of the already established property tax relief mechanism known as the Homestead Exclusion, fixing the dollar amount at 100 percent of assessed value.
It will provide the revenue necessary to eliminate school property taxes off of owner-occupied homes via the homestead exclusion by increasing the Personal Income Tax (PIT) to cover the amount needed to offset owner-occupied residential school property taxes. This is a first step toward full school property tax elimination.

Last Action: Referred to Senate Finance Committee on Aug. 7, 2019.

In addition, Sen. Scavello has circulated a cosponsorship memo for a proposed bill that would provide school property tax relief for senior citizens. Specifically, his legislation would provide for a property tax rebate of up to $5,000 for all seniors age 65 and older who have an annual household income of less than $60,000. This legislation expands upon the already existing Property Tax Rent Rebate Program.

House

House Bill 76 (Cox): Would eliminate school property taxes and shift to an increased Personal Income Tax (PIT) and an increased and expanded Sales and Use Tax (SUT).

Last Action: Referred to House Finance Committee on September 18, 2019.

House Bill 714 (DeLuca): All individuals 65 and over would have their property taxes frozen at the current amount.

Last Action: Referred to House Finance Committee on March 6, 2019.

House Bill 1200 (Hahn): Would enable school districts to exclude up to 100% of a homestead or farmstead with lost revenue replaced by a 1.8% increase in the Personal Income Tax.

Last Action: Referred to House Finance Committee on April 15, 2019.

House Bill 1231 (Gillespie): The “Residential Property Tax Elimination Act” would eliminate all school residential property taxes, existing earned income taxes in lieu of property taxes, as well as other payments in lieu of taxes; increase the Personal Income Tax from the current rate of 3.07% to 4.5%; add food and clothing to the items currently taxed under the sales tax; and increase the sales tax rate on those items from 6% to 7%.

Last Action: Referred to House Finance Committee on April 17, 2019.

House Bill 1247 (Caltagirone): Would eliminate school property taxes on the homestead of Pennsylvania seniors who qualified for the property tax rebate program.

Last Action: Referred to House Finance Committee on April 16, 2019.

House Bill 2119 (Pashinski): The “Universal Property Tax Relief Rebate Program” would provide an $800 rebate to all property taxpayers and a $50 rebate for renters. It would be funded through a Personal Income Tax (PIT) increase to 3.49%, and the expansion of the sales tax to include certain luxury items and services.

Last Action: Referred to House Finance Committee on Dec. 10, 2019.

Rep. Frank Ryan has circulated a cosponsorship memo for a pair of bills that would totally eliminate school property taxes and create a commission that would be tasked with coming up with a tax package that would replace the eliminated revenue. The sources for such revenue could come from any or all of the following: Personal income tax/Earned Income Tax increases, sales and use tax increases, a tax on unearned income, with exclusion only for return of capital of funds taxes initially (deferred compensation, etc), and the property tax rebate programs that would be eliminated.

Workshop Discussion Focuses on Common Ground

8/13/19 - Property Tax Elimination Roundtable

On August 13, the Senate Majority Policy Committee held a workshop on the issue of school property tax elimination.

The discussion featured testimony and opinions from various individuals and groups including superintendents from York County school districts, the Pennsylvania Association of School Business Officials, the AARP, York County Realtors, the Pennsylvania Liberty Alliance, the Pennsylvania Property Rights Association and the Pennsylvania Chamber of Business and Industry.

The purpose was to gather individuals of differing viewpoints to determine common goals in working towards meaningful relief for all Pennsylvanians.

Additional forums are being planned.

Independent Fiscal Office Crunches The Numbers

One proposal seeks to provide a property tax rebate of up to $5,000 to eligible homeowners based on age and income, not to exceed actual school district property taxes paid.

The state’s Independent Fiscal Office recently estimated $1.23 billion would necessary to fund the plan, resulting in increases of .64 percent in the sales tax .33 percent in the personal income tax.

Response Letter August 16, 2019

Response Letter September 6, 2019

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