Voters on Tuesday will decide on changing a constitutional amendment that could pave the way for more school property tax relief.
Otto-Eldred School District Superintendent Matthew Splain called the proposed constitutional amendment to the Homestead Property Tax Assessment Exclusion a one-to-one tradeoff in revenues. The exclusion provides for property tax reduction allocations for most owner-occupied homes and farms.
“The amendment would allow for an increase in the amount the reduction that homeowners receive,” he said. “The state would need a revenue source to replace the lost revenues districts would realize.”
For now, Bradford Area School District Superintendent Katy Pude said she stands neutral on the proposed constitutional amendment.
Currently, 50 percent of the median assessed value of the homestead properties can be excluded, Pude said, noting that to pay for the current exclusion, $3.5 billion is needed. A total of $620 million has been earmarked for the existing exemption.
“This funding hasn’t increased in over 10 years so I am not sure of the plan to fund the proposed amendment in its entirety of almost $7 billion,” she said.
If the question is approved by voters, the General Assembly would be able to pass a law that allows local taxing authorities to exclude as much as 100 percent of the assessed value of each homestead property when calculating the real estate tax owed on homestead property.
Splain said that many people would feel more comfortable with the proposal –– if a complete solution would be presented to the homeowners.
“Where would the missing revenue come from? This would likely be a tax shift — away from property taxes and toward sales or income taxes,” he said. “Someone will have to replace the property tax revenue. If Senate Bill 76 is used as a guide to see where this goes, it will be the consumers.”
For his part, state Sen. Joe Scarnati, R-Brockway, he said he plans on backing the ballot question.
“Should the measure pass, we will be able to follow up with legislation to provide the revenue necessary to eliminate school property taxes on primary homes,” he said in an op-ed that appeared in The Era earlier this week.
Galeton School District Superintendent Alanna Huck said she doesn’t support the amendment.
“Although this amendment does not specifically apply to the elimination of property taxes, I think it is a step in the direction to eliminate local control regarding the ability of a school district to raise taxes in the future,” she said.
As the proposed constitutional amendment stands, the school district would not be impacted, St. Marys Area School District Superintendent Dr. G. Brian Toth said.
The state government has only set aside a small amount of money each year for homestead/farmstead exclusion through gaming revenue, according to information provided by Toth.
“The state would have to find a significant revenue source to give to districts enough funds to even reach the 50 percent amount, let alone the 100 percent,” Toth said. “We don’t think districts will use their own funds to increase the exclusion amount.”
Many individuals believe the passing of the referendum would provide legislators with an incentive to propose Senate Bill 7-type legislation that would do away with property taxes, Toth said.
“However, such legislation would actually override this amendment as it would replace local property taxes with the higher state (personal income tax) and (sales and use tax) taxes, making it a state decision instead of a local decision,” he said.
Voters to decide on homestead constitutional amendment
By ALEX DAVIS
Era Reporter
Voters on Tuesday will decide on changing a constitutional amendment that could pave the way for more school property tax relief.
Otto-Eldred School District Superintendent Matthew Splain called the proposed constitutional amendment to the Homestead Property Tax Assessment Exclusion a one-to-one tradeoff in revenues. The exclusion provides for property tax reduction allocations for most owner-occupied homes and farms.
“The amendment would allow for an increase in the amount the reduction that homeowners receive,” he said. “The state would need a revenue source to replace the lost revenues districts would realize.”
For now, Bradford Area School District Superintendent Katy Pude said she stands neutral on the proposed constitutional amendment.
Currently, 50 percent of the median assessed value of the homestead properties can be excluded, Pude said, noting that to pay for the current exclusion, $3.5 billion is needed. A total of $620 million has been earmarked for the existing exemption.
“This funding hasn’t increased in over 10 years so I am not sure of the plan to fund the proposed amendment in its entirety of almost $7 billion,” she said.
If the question is approved by voters, the General Assembly would be able to pass a law that allows local taxing authorities to exclude as much as 100 percent of the assessed value of each homestead property when calculating the real estate tax owed on homestead property.
Splain said that many people would feel more comfortable with the proposal –– if a complete solution would be presented to the homeowners.
“Where would the missing revenue come from? This would likely be a tax shift — away from property taxes and toward sales or income taxes,” he said. “Someone will have to replace the property tax revenue. If Senate Bill 76 is used as a guide to see where this goes, it will be the consumers.”
For his part, state Sen. Joe Scarnati, R-Brockway, he said he plans on backing the ballot question.
“Should the measure pass, we will be able to follow up with legislation to provide the revenue necessary to eliminate school property taxes on primary homes,” he said in an op-ed that appeared in The Era earlier this week.
Galeton School District Superintendent Alanna Huck said she doesn’t support the amendment.
“Although this amendment does not specifically apply to the elimination of property taxes, I think it is a step in the direction to eliminate local control regarding the ability of a school district to raise taxes in the future,” she said.
As the proposed constitutional amendment stands, the school district would not be impacted, St. Marys Area School District Superintendent Dr. G. Brian Toth said.
The state government has only set aside a small amount of money each year for homestead/farmstead exclusion through gaming revenue, according to information provided by Toth.
“The state would have to find a significant revenue source to give to districts enough funds to even reach the 50 percent amount, let alone the 100 percent,” Toth said. “We don’t think districts will use their own funds to increase the exclusion amount.”
Many individuals believe the passing of the referendum would provide legislators with an incentive to propose Senate Bill 7-type legislation that would do away with property taxes, Toth said.
“However, such legislation would actually override this amendment as it would replace local property taxes with the higher state (personal income tax) and (sales and use tax) taxes, making it a state decision instead of a local decision,” he said.
