Property tax reform has remained elusive for years, with York County’s elected delegation in the minority as they push for change.
But local legislators are saying the stars could finally align this fall, and there are at least two locally crafted proposals competing for support.
Majority Whip Stan Saylor, R-Windsor Township, said he has a commitment from House Majority Leader Mike Turzai to visit the issue in September or October, after the state’s budget is tucked away for another year.
Rep. Seth Grove, R-Dover, has been tweaking his proposal for years to remove the contentious aspects and give it its best chance at passing.
He removed a business-bemoaned sales tax provision and included the strategically innocuous word “optional” in the title for its current incarnation of the Optional Property Tax Elimination Act.
Other proposals have been shut down because they called for statewide elimination of property taxes, an unpopular idea in slower-growing regions where the state’s education funding formula benefits taxpayers and the property taxes are lower.
Grove’s legislation, House Bill 1189, allows each school board to vote on whether to shift property taxes to earned income and net profits, mercantile and business privilege taxes.
That way, those who want to shift can, but it’s not a statewide requirement.
Gillespie plan: Grove’s plan was aired last week in the House Finance Committee, as were four pieces of legislation authored by Rep. Keith Gillespie, R-Hellam Township, who’s calling for the statewide elimination of property taxes.
Gillespie said his package, for which only one bill has
been introduced, would address all aspects of the current problems surrounding school funding.
His plan calls for increasing the state’s personal income tax from 3.07 percent to 4.5 percent, raising the sales tax from 6 percent to 7 percent, and adding food and clothing to the list of items currently taxed.
The introduced bill, House Bill 719, revisits prototype schools to create a template plan for the construction of new school buildings, saving school districts money on architectural and related fees.
The other two bills address a “hold harmless” clause and a constitutional amendment necessary to consider residential property taxes separate from taxes paid by commercial property owners.
“The ‘hold harmless’ legislation is particularly critical, as it would address the growth experienced by schools in south-central Pennsylvania and the population shift out of the western Pennsylvania,” Gillespie said. “Guaranteeing a school district will not get less money than the prior year, despite a shrinking population, essentially penalizes growing school districts like those in York and Adams counties.”
Reaction: Saylor said both are “good pieces of legislation, it just depends which way you want to go.”
He said statewide reform would be better, but it’s never been able to garner the 102 votes needed to pass the House. Even when legislation — such as last year’s constitutional amendment to eliminate property taxes — passes the House, it can die in the Senate.
“So from my point of view, I’m very frustrated,” he said. “I talk to constituents all the time, saying ‘Why can’t you get this done?’”
The short answer is that most people in most parts of the state are paying a fraction of the $4,000 per year tax bill that many pay in York.
“I do think Seth Grove’s bill probably has more palatability because it’s local,” Saylor said. “If Stan Saylor had his choice of which one passed, he’d rather do statewide. It’s a cleaner way of doing it.
“Seth is a big supporter of that as well, but he realized that wasn’t going anywhere … but I think we have a shot at doing something in the House in the coming months, I really do.”
Grove said he’s optimistic, with Turzai having said in caucus that he wants to run the bill in fall.
“I think that out of any of the proposals that have been introduced, this has the best chance of being signed into law and being effective.”
Matter of timing: Rep. Ron Miller, R-Jacobus, said he’d like to just rework the state’s entire education funding system, but he’s optimistic the Grove and Gillespie proposals will at least drive discussion in a productive direction.
Miller said he’s concerned that Grove’s legislation could create competition between school districts.
“If Dallastown did a sales tax and Red Lion did the income tax, people would live in Dallastown and buy their products in Red Lion,” he said.
But he co-sponsored it to advance the property tax reform debate, he said, and he’s optimistic that “the climate is right for a change.”
There’s new growth in areas of the state where there’s natural gas drilling in the Marcellus Shale, he said.
“So all of the sudden they’re facing the same problems we’ve faced,” he said. “I’m hopeful they’re starting to see the writing on the wall and will come to the table willing to discuss a new way of funding education in Pennsylvania.”
“I think we will probably have a very robust discussion on this topic come the fall,” he said. “It’s set to the point where it’s going to happen.”