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School real estate taxes – Pennsylvania’s most hated

There’s not much agreement between Republicans and Democrats in our area, but there is one thing on which they are almost universally united: Just as their constituents do, they love to hate the school real estate tax, which districts are putting into place as part of their official budget adoption for the coming school year by June 30.

According to state law, the tax rate must be fixed no later than this date. Most districts did not raise rates last year in deference to the economic and emotional hardships suffered because of the COVID-19 pandemic.

This year, however, with much of the country coming out of the lockdowns and restrictions that have been imposed to put the brakes on the spread of the virus, most districts have introduced at least tentative budgets that call for tax increases along with a return to classroom learning.

They are pointing to increased costs associated with COVID-19 and decreasing earned income tax revenue because many have been out of work or have not returned to the workforce because of other factors.

Lehighton, for example, is looking to raise taxes by 4.2%, the highest the state allows without voter intervention. Should the increase hold through final adoption, it would follow a 3.6% tax increase last year and a nearly 2% increase the year before that. A homeowner with a property assessed at $80,000 would see a $170 increase in property taxes for the 2021-22 school year.

Palmerton plans to increase taxes 1 mill, which translates to about $48 more for the average taxpayer.

Panther Valley, regarded as the most needy district in our area, passed a tentative budget that relies on $6 million in stimulus funds to balance the budget and eliminates the need for a tax increase. Otherwise, the district was looking at a 3% increase for next year. I am sure district residents are wondering what will happen next year when there is no stimulus money to plug the hole in the dike.

There is no question that among the three taxing entities - municipality, county and school - school taxes are by far the greatest, dwarfing in just about every instance the other two combined by many multiples.

Having heard this growing chorus of complaints from their constituents, especially older property-owners who no longer have children in school, politicians have tried to build consensus and do something about this onerous tax.

Just about everyone who has gone down this path has found that this road to undo this hellish tax is paved with good intentions but, so far, no real solutions, and the devil always seems to be in the details.

State Sens. David Argall, R-Schuylkill, and Mario Scavello, R-Northampton and Monroe, are two of the leading proponents to elimination or modification of the school tax, but, so far, neither has been able to rally a coalition of their colleagues to pull the trigger.

Sure, everyone wants this tax gone, but there is no consensus about what replaces it. A commission headed by Argall came up with five proposals to replace the property tax, among them a hefty increase in the state income tax. Another proposal would be to assess a state tax on federal Social Security benefits. None of these is particularly popular either.

In 2020, there was an encouraging signal that things might be moving off dead center when then-Senate President Pro Tempore Joseph Scarnati said he would call for a vote on the issue. When legislative leaders speak, members listen, but then the pandemic hit, and legislative focus went elsewhere. On top of that, Scarnati retired on Nov. 30, and his successor has not shown a similar inclination to support quick action on getting this resolved.

Scavello has introduced legislation that 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 $60,000 or less. Only half of a person’s Social Security benefits would count toward the income limit. Scavello’s bill would require a half-percent increase in the state’s 6% sales and use tax but would not expand the list of taxable items, including clothing.

Scavello described heartbreaking stories from constituents who have been taxed out of their homes, seniors who have seen large increases in their school property tax bills during their retirement and widows and widowers who were forced to sell off many of their possessions. Most dire, he said, are those cases of people taking their lives over losing their homes due to unpaid taxes.

“If even one senior or family loses their home to school taxes, that’s one too many,” Scavello said. “Our battle cry remains: ‘No tax should have the power to leave you homeless!’ Politics is rarely an all-or-nothing game, and, when it comes to school property taxes, I would rather a bite of the apple than no apple at all,” Scavello added.

In the end, it doesn’t matter how Argall, Scavello or any of our other legislators feel individually. To pass any proposal requires the support of 102 representatives, 26 senators and a governor willing to sign the bill, or, failing that, a two-thirds majority of the General Assembly to override the governor’s veto.

By Bruce Frassinelli | tneditor@tnonline.com

The foregoing opinions do not necessarily reflect the views of the Editorial Board or Times News LLC.