PENNSYLVANIA TAXPAYERS CYBER COALITION

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Features

Personal Property Tax Independence Act Tax Calculator
Excel calculator to see your tax savings under the provisions ofThe Property Tax Independence Act. Now includes calculations for Philadelphia property tax reduction!

The Property Tax Independence Act Petitions
Sign an individual petition to demonstrate your approval of the The Property Tax Independence Act or distribute a multi-signature petition to really gather support! Print extra copies for your friends, family, and neighbors so they can help, too! Download the petitions as PDF files here.

Why school property taxes need to be eliminated!
Two excellent essays on the fallacy of property taxes for education funding.

 

PTCC Archive


21 August 2006

Dear Friends,

Summer is a slow time for our effort since the Legislature is not in session, but the PTCC and the PCTA are still working hard on the school property tax reform issue and have some news that’s worth sharing.

The Pennsylvania Coalition of Taxpayer Alliances now has 22 member groups! The latest organizations to join in our effort are Taxpayers United Reform Needed (TURN) from Venango County and the Owen J. Roberts Taxpayer’s Association from Chester County. Welcome to our new members and supporters! It’s great to see that the momentum for true property tax reform is continuing to build.

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The PTCC website has been updated since the last newsletter. Please visit the site at http://www.ptcc.us to see these items:

A new introduction and history has been added to the Act 1 explanation. Go to “The Act 1 Farce” link to read it.

A new explanation of the Plan For Pennsylvania’s Future has been added that summarizes the provisions of this plan for school property tax elimination. Go to “The Legislative Solution” link to read it.

Although it’s not new, the Act 1 Calculator is a must-see. This user-friendly spreadsheet will calculate your total school tax liability through 2010 under the provisions of Act 1. For most of you it will be a real shocker! Go to the “Calculate Your Act 1 Taxes” link to run or download this great tool.

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On August 16, Mike Faust interviewed me on the Newsmakers segment of Feedback on WEEU, Reading. The show went very well and generated a lot of interest from the listeners; Mike was a great interviewer and helped me to get across the important points of our tax reform effort. Actualities from the interview were also used by Len Carmen in the WEEU newscasts later in the day. The PTCC website had 256 hits in the few hours following the interview and the e-mail list gained 34 new subscribers. Thanks for all of your help, Mike and Len! If you’d care to listen to this sixteen minute interview, an audio file is available on the PTCC website under the “PTCC Archive” link.

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There were some interesting newspaper items during the past few weeks, the most notable being a front page piece in the Pottstown Mercury about the PTCC and the PCTA. Our thanks to Brandie Kessler for this fine article. Click here to read it.

The Daniel Boone Taxpayers Association, a PCTA member, had a victory of sorts over the Daniel Boone school board. They managed to force the school board to rebate to the taxpayers a portion of the extra monies it received from the state this year. Click here to read about it in the Pottstown Mercury.

We’ve been saying from the start that the school property tax “relief” in Act 1 was only a smokescreen to justify slot machine gaming. There are two recently-published articles that emphasize this.

The first, from the Associated Press, was published in the Reading Eagle on August 20. Click here to read it.

Here are some examples of campaign donations given by various groups that represent applicants for slot parlor licenses in Pennsylvania. These donations were made in the period from January 1 to June 5, 2006, just a little more than five months.

Sen. Robert Jubelirer: $62,500
Governor Ed Rendell: $60,000
Rep. John Perzel: $46,000
Sen. Vincent Fumo: $29,500
Rep. Sam Smith: $29,000
Rep. Michael Veon: $26,500
Senate Republican Campaign Committee: $24,000

And there was this related article in the Centre Daily News. Click here to read it.

After reading these items, do you really believe that the passage of Act 1 was motivated in any way by the desire for school property tax relief?

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And finally, this item from Mary F. Yoder on the Commonwealth Foundation website, reprinted with the permission of the Commonwealth Foundation. http://www.commonwealthfoundation.org

'Back-end referendums' won’t help taxpayers

The recent enactment of Special Session Act 1 of 2006, the so-called "Pennsylvania Taxpayer Relief Act," came as a disappointment to taxpayers throughout the Commonwealth who are fed up with increasing school property taxes.

When given the opportunity to tighten the "back-end" referendum provisions that existed under Act 72 of 2004 (the previous law that was to distribute the gambling tax revenues), the legislature instead broadened the exemptions and enabled school districts with the power to circumvent voter referendum and continue to increase spending without hindrance.

Like Act 72, this law represents a weak attempt at curbing school spending through voter referendum. Certain proposed property tax increases that exceed a district’s so called "inflation index," which ranged from 3.9 to 6.5 percent in 2006, would have to be approved by voters. While this sounds like an excellent solution, Act 72 gave taxpayers in only one of the 111 participating school districts the ability to vote on proposed tax increases.

The façade of voter control of school property tax increases is twofold. First, the "inflation index" allows many districts to increase property tax rates substantially without voter consent. The "inflation index" varies by district and gives school boards generous leeway to increase spending well above traditional measures of inflation, without facing referendum.

Second, Act 72 provided ten spending exceptions for which school districts could avoid voter referendum. These loopholes allowed many tax increases to occur without voter input. In fact, 26 of the 111 school districts that opted into Act 72 submitted budgets greater than the "inflation index," but only one district was required to hold a voter referendum, as all the others were exempted.

These flaws remain in the new legislation. A lengthy list of loopholes and a hefty inflation index will allow districts to avoid the ballot box and leave voters helpless in the face of major spending and tax increases. Throughout the Commonwealth, property taxes will continue to rise and further burden taxpayers.

In the State College Area School District, the new mandate started a spending race. The school board’s effort to pass a $102 million construction plan in advance of the implementation of referendum could lead to bloated budgets for years to come. Why? Because paying off debt that was incurred before the implementation of Act 1 is exempted when future tax increases are considered.

The expensive proposal has created a massive public outcry, but the ultimate decision is in the hands of State College’s nine-member school board, not the taxpayers. If the building plan faced voter referendum, its future would be uncertain.

Statewide, it appears that tax increases over the next three years will far exceed any expected relief in 2008 or 2009. A 5 percent annual increase in property tax rates — the average cap for school districts in 2006 — represents $1.5 billion in increased revenue from 2005-06 to 2008-09.

Many lawmakers from both parties — whether they voted for or against the bill — acknowledge that Act 1 was a compromise, and that they desired something more substantial. Yet taxpayers and homeowners will continue to suffer until lawmakers give them real control over tax increases.

Pennsylvania’s school boards exercise far more taxation power than their counterparts in other states. According to the Education Commission of the States, Pennsylvania is the only state that places no practical limits on the taxing and spending power of school boards. Yet Pennsylvania’s only limit on local school boards is the new token referendum, which most school boards will be able to avoid even while hiking property taxes.

The Pennsylvania Taxpayer Relief Act merely serves as a Band-Aid for Pennsylvania’s property tax crisis. Rather than confronting increased school spending, the recent legislation offers voter referendum with no teeth and no way to control the spending explosion that is taking place in our school districts.

Sound property tax relief in Pennsylvania will not become a reality until school spending is substantively restrained by empowering taxpayers with a vote on any and all tax increases. Only when we give control back to the people who pay the bills will relief come to Pennsylvania homeowners.

Mary F. Yoder is a research intern with the Commonwealth Foundation, an independent, non-profit public policy research and educational institute located in Harrisburg.

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That’s it for today.

As usual, your comments, concerns, and suggestions are always invited. Just send an E-mail to pataxpayers@gmail.com and we’ll give you a prompt response. And please don’t forget to spread the word to your friends, family, and acquaintances – our grassroots movement keeps building and you can help by enlisting others who are concerned about this growing problem that affects all Pennsylvanians.

Thank you for all of your continuing support.

David Baldinger
http://www.ptcc.us