Should school property taxes be eliminated?
The Pennsylvania Senate is considering the elimination of school property taxes, and a meeting will be held in York County next month to discuss options.
"Property taxes are a major concern for a majority of York countians," said Sen. Kristin Phillips-Hill, R-York Township, who requested the Senate Majority Policy Committee meeting at Penn State York on Tuesday, Aug. 13.
Former York City School District Superintendent Eric Holmes has said the disparity between spending available to wealthier districts compared with poorer districts based on property values is a huge problem.
"It's not supposed to be that way, but it is," he said. "As long as we continue to use property taxes as the basis by which we fund education, that discrepancy will always exist."
In 2012, the state had the largest disparity in per-pupil spending between wealthy and poor districts in the country, according to data from the National Center for Education Statistics compiled by the Washington Post.
Phillips-Hill said several pieces of legislation are under consideration, including SB 76, "a total and complete elimination" of property tax funding for schools, and others that would exempt low-income households, senior citizens and noncommercial residences.
It's a longstanding issue that Senate leadership hopes to address this term, she said, but "you have to build support."
Concerns among legislators have included a loss of local control and what taxes would replace the revenue stream. Opponents have voiced concerns regarding what commercial and industrial entities would pay.
Another bill, HB 1231, would eliminate the tax entirely but change how funding is shifted.
As it's now written, SB 76 would increase the sales and use tax 1% and the personal income tax from 3.07% to 4.95%. HB 1231 would increase the personal income tax to 4.5% and add food and clothing to the sales and use tax and increase that tax rate 1%.
The closest the state has gotten to passing a school property tax elimination bill during Phillips-Hill's 4½ years in the state House of Representatives was an amendment that proposed a 50% dollar-for-dollar reduction, she said.
Dollar-for-dollar would mean that every dollar reduced would be replaced with a dollar from another tax — so as to shift taxes, not raise them.
The amendment made it to the Senate floor, where then- Lt. Gov. Mike Stack cast a dissenting tiebreaker vote.
It wouldn't be the first time school property taxes were reduced.
In 2006, Idaho reduced that funding stream by $260 million in exchange for a 1% increase to the state sales tax, but the 2008 recession created a loss for 18 rural districts, according to a 2019 article in Phi Delta Kappan, a professional journal for educators.
As of 2019, only 11 of those districts have been able to replace funding with a supplemental levy, and many moved to a four-day week to cut costs. The state now has a much larger spending disparity between districts, the article states.
"Funding schools is an expensive proposition," Phillips-Hill said, noting that what's driving districts to spend so much must be addressed — and it's usually federal or state mandates, she said.
The goal of the committee meeting is to find out which bill would generate the most support and have the best chance of passage.
It will be a public meeting from 1 to 3 p.m. Aug. 13 at the Pullo Center at Penn State York.