New Castle News
NEW CASTLE —
Although the Pennsylvania House has approved legislation that allows school districts to eliminate property taxes, don’t hold your breath.
The measure still has to pass the state Senate and be signed by the governor. And it’s not unusual for superficially popular bills to pass one chamber in Harrisburg and vanish in the other.
The measure passed by the House Wednesday would grant school districts the power to reduce or eliminate property taxes in exchange for other levies. Specifically, these would be boosts in the earned income tax and some business taxes.The move would be optional. Districts could keep their current tax structures or change them as they see fit. Although a public hearing would be required to make any adjustments, voters would not be able to chime in with a referendum.
It’s worth noting that the bill passed with bipartisan support and no debate 149 to 46. That would suggest to some that it will have an easy time in the Senate.
However, looks in Harrisburg can be deceiving.
A lawmaker who votes to support this measure can tell the folks back home he or she created a path to eliminate school property taxes. If districts don’t do it, well, it’s not the fault of state representatives.
But easy passage in the House for purely political reaons means it’s now up the to Senate to look at the bigger picture. And senators will be listening to interest groups that don’t think this is such a great idea.
Among them is the National Federation of Independent Business, which fears school boards will find it politically expedient to dump higher taxes on businesses, while cutting them on individuals, partularly retired property owners.
That’s one of the unspoken realities of tax changes. If someone pays less, that means somebody else pays more. Those likely to be losers in the process get louder as a bill nears passage.
Theoretically, we support the flexibility this legislation gives local school districts. But such a view presupposes school boards have the expertise to assess their communities in terms of what level of taxation in different categories is fair and the least likely to produce negative impacts. That includes high business taxes that deter new development.
Realistically, this legislation has more to do with state lawmakers acting to protect themselves than a means of crafting sound fiscal policy for school districts. And if it passes, the measure may also be used to justify further reduction in state funding for education.
Meanwhile, we will see what the Senate does. That chamber could dramatically alter specifics in the legislation, or allow it to die quietly. It’s an interesting and complicated subject, so the process will be worth watching.