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Lawmakers Tread Water on Property Tax Reform

A state House committee is expected to file a report on property tax relief measures by Nov. 30, examining municipal and school property tax rates and their cost drivers.

By Melissa Daniels | PA Independent

HARRISBURG — State Rep. Nick Micozzie, R-Montgomery, served on a property tax committee around 12 years ago, he said. The committee also crafted a report to reform school property taxes. And then it failed to secure the votes on any legislation.

He said he doesn’t see that changing this time either.

“I think we’re going to spin our wheels a lot of times, like I have done over the years,” he said.

Micozzie joined 12 other members of the House Select Committee on Property Tax Reform last week and heard the same arguments for property tax reform lawmakers made this past session, treading water until a new fiscal analysis comes out in the fall.

The committee is expected to file a report on property tax relief measures by Nov. 30, examining municipal and school property tax rates and their cost drivers.

The committee heard testimony on three property tax reform proposals from the bills’ sponsors:

Among the issues discussed Monday were:

  • Should the state take control away from the school districts, which collect and set the property taxes?
  • Is the tax shift conceptually fair, or revenue neutral?
  • How many taxpayers would pay more than they already are?

Estimates on the Property Tax Independence Act, or House Bill 1776 and Senate Bill 1400, from the state Department of Revenue suggest the tax shift would generate around $9.1 billion, while school property taxes bring in around $12.5 billion annually. That disparity was a main reason why HB 1776 stalled in committee earlier this year.

But, SB1400 sponsor state Sen. David Argall, R-Berks, said the Independent Fiscal Office, a state legislative version of the federal Congressional Budget Office, will provide a new analysis on revenue streams. The committee will hear those in September.

Argall said he’s “frustrated” nothing has moved on the issue of property tax relief and is willing to discuss potential changes to the tax shift to get something passed.

State Rep. Madeline Dean, D-Montgomery, said the committee will need to look at new information, and the context of what lawmakers have tried to do in the past, to reach a consensus. A final plan should not leave the committee, falling on partisan lines, with seven Republicans and six Democrats, she said.

“If we leave like that in November, I think we’ve risked wasting each others’ time,” she said.

Committee chairman state Rep. Tom Quigley, R-Montgomery, said the IFO analysis combined with past research could yield new plans. He said the goal is to get legislation in front of the new session of the General Assembly come January.

He said he’s not concerned about the short timeline.

“Even though we have this short window to work in, I think there’s been so much research and so many other studies that have been done, that we can use a lot of that material and just try to work with it in the right way,” he said.

Andrew Wilt September 04, 2012 at 01:01 PM
Wayne Schissler - I spent years working through the data, the pricey properties are not assessed proportionately to the median and lower valued properties. The rich, just like everyone else, should pay their fair share. In the case of Pennsylvania property assessments, they don't. Your assertion that the value of the property is not an indicator of the owner's income is ludicrous.
Lower Saucon Guy September 04, 2012 at 01:33 PM
@Mike. I really don't see what the difference is as to who pays the taxes. The property owner has taxes figured into his rental price. He makes a profit after all expenses including tax are deducted. I've owned a few homes already and choose not o own one now at this stage in my life. This has been a common complaint since I was a youngster. Why do the property owners have to pay for school kids, when they don't have any kids in school. I used to bitch about it all the time. I'm way too old to have kids in school anymore, it's more like my grandkids now. I guess in this country, if you want to own property, you have to continually pay. They may have even gotten the homesteaders in Alaska by now.
Andrew Wilt September 04, 2012 at 01:57 PM
Joseph Gimaro - It seems you should be all the more concerned about the properties in your municipality being properly assessed. However, you say you got a new assessment 60 days or so ago. Why did you get a new assessment?
Joseph Gimaro September 04, 2012 at 10:20 PM
My new assessment is a result of the Lehigh County-wide reassessment, approximately 60 days ago I received the final determination of my frivolous appeal. If we would adopt the sales and income tax increase approach, all the concerns of my neighbors being properly assessed, which seems to be a discussion that will never have mutual satisfaction, would be a mute point.
Wayne Schissler September 04, 2012 at 10:41 PM
Andrew said,"Your assertion that the value of the property is not an indicator of the owner's income is ludicrous." Then let me introduce you to the world were elderly people have to take in borders or rent their garages out to make ends meet. Where people can no longer manage and must consider a reverse mortgage. Where you inherit the home you grew up in but realize you would never be able to afford the taxes and must sell it in a depressed market. Does the outside of the house tell you that? Do your public records tell you how many snowmobiles and ski-doos are in that modest house's garage and how much they spend on recreation? Do they tell you who goes on cruises and who never goes farther than the Jersey Shore? Do you just assume the house tells you that? Have you ever seen the inside of a McMansion that is barely furnished and cold in the winter? If homes are an indicator of wealth then I guess nobody bought a house that was beyond their means. Since we're talking about schooling..., when the lower middle class and poor who maintain a decent home in a good area but scrimp and save to send their child to a quality private school - do the public records tell you how much they save they district while still paying the full amount of taxes? While the rich guy you loathe brags that he sends his kids to the public school with the "common folk". When you have your eyes fixated on the large lot with the stone house you just might miss the rest of the world around you...

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