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Property Taxes and the recent Budget-What next??

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Ron Boltz of PA Liberty Alliance

Property Taxes and the Recent Budget-What next??

 

Most of you know by now that Governor Wolf has reluctantly stated that he will not sign the recent bill to finalize the ’15-’16 budget into law, but he won’t veto it either, which means it will still become law.  The Governor did not sound happy when he delivered this news, and for good reason.  He is not getting his massive tax increases that he’s been trying to get by holding your children and school district hostage.  His plan backfired, and it’s important to understand why.

 

Throughout the budget talks, those of us who have been advocating for school property tax elimination have been extremely active.  We’ve stayed on top of every move the House and Senate were making, and we got the word out to our people faster than the media and most other organizations.  We made phone calls, sent emails, and showed up at the Capitol to demand no tax increases from those who were willing to cave, as well as to show our support to those who were standing strong.  Our message was clear…”no income or sales tax increases without school property tax elimination.”

 

While other organizations were also sounding the alarm for no tax increases, it was our voice that has been louder than others, and our message is absolutely resonating in the Capitol halls.  In a recent meeting with a large number of opposing lobby organization, two Democrat senators who are SB 76 supporters informed the lobbyists that there will be no tax increases without property taxes being addressed.  This is very telling, especially since it’s coming from the Democrat side.  Even Gov. Wolf has been speaking more about property taxes than any governor in recent history.  This issue isn’t going away, but what will Harrisburg ultimately do?

 

The problem we face is twofold.  First, the governor’s idea of addressing property taxes is to tax everyone more via increased sales and income taxes, but he doesn’t want to eliminate the school property tax.  In fact, he wants to only give a portion of that revenue back to the taxpayers in the form of “relief”, and what’s worse is he wants to redistribute it to the districts of his choosing rather than uniformly among all taxpayers and all districts.  His plan is just a huge redistribution of wealth scheme that would result in an overall tax increase for most of us.

 

The second problem is that politicians tend to do what’s politically expedient, rather than to pass bills that actually have teeth.  If they have a choice between making a tough vote to do something right, or making a much easier vote in an effort to appease just enough people to relieve a little pressure, kick the can down the road and not actually fix the problem, they will usually choose the latter.

 

I mention all of this because I believe that we now have two choices.  We either get a property tax “reduction” scheme, or we get complete school tax elimination.  There are no other choices at this point.  This issue is too hot to be ignored forever, and the comments made at the most recent SB 76 meeting reinforces my belief that Harrisburg is going to give us “something” in regards to property taxes.  Those who oppose SB 76 now need to ask themselves if they would rather have another reduction plan that will ultimately fail and result in a tax increase on all of us, or would they rather have elimination?

 

Some of you who are reading this may be thinking that you’ll take anything you can get.  I caution you to not accept a reduction scheme.  First, any plan that doesn’t eliminate the property tax will only result in the property tax continuing to go up to and beyond current levels, with new taxes to pay on top.  Second, many people will be instant financial “losers” in a reduction scheme, because the increase in the other taxes won’t be offset by anything other than a complete elimination of the school tax.  We hear from legislators all that time that we need to “be more reasonable”, we need to accept “compromise”, and that “half a loaf of bread is better than nothing at all”.  Don’t fall for this!  In this case, “compromise” means a tax increase.  It’s about time our government “compromises” with us, rather than the other way around.  As a taxpayer, I’m done with constantly having to be the one to compromise.

 

Senate Bill 76 in it’s current form absolutely eliminates the school property tax.  A small portion would remain to pay off existing debt, but that debt can’t be expanded or refinanced for a longer term.  When it’s paid off, the property tax goes away 100%.  In the meantime, you will still get a 90% reduction.  Don’t let any legislators mislead you on this, and don’t let them convince you that “we need to control spending first”.  This is the latest talking point of the The Chamber of Commerce and NFIB.  SB 76 enacts the spending controls they claim they want, but they continue to ignore this fact.  The bill stops the runaway property tax, which is currently rising at more than twice the rate of inflation, by only allowing increases that are tied to the lesser of the rate of inflation or your average weekly wage growth.

 

Their idea is to continue to allow Harrisburg and the local school boards access to the credit card while trying to convince them to use it responsibly.  This has clearly not worked, and it keeps the status quo alive and well.  Our idea, on the other hand, is to take the credit card away from them, and FORCE them to live on a budget like we do.  Which do you think is a better strategy?

 

Passing SB 76 will make Harrisburg take spending control measures much more seriously, rather than continuing the foot dragging they’ve been doing for so long.   Until they are forced to do this, they won’t.  Until Harrisburg politicians can no longer pass down pension obligations and other mandates to the school boards and homeowners to pay through huge property tax increases, they will just continue to do so.  It’s easy to allow out of control spending to take place when they don’t have to be responsible for raising your taxes.   Let me be clear.  Our school boards are to blame for overspending as well, but the property tax is also used as Harrisburg’s scapegoat, and they know it.  You don’t have nearly as much “local control” as Harrisburg wants you to believe.  SB 76 puts both Harrisburg and the school boards on a diet, while still allowing the voters to decide if they want to increase local spending.  This is the ultimate “local control”.

 

Our job now is to make it clear that reduction schemes aren’t acceptable.  During a recent presentation that I gave in Indiana County, Rep. Reed said that he would accept a reduction plan “as a first step”.   I reject that idea, because the next step will never come.  This is just another example of Harrisburg wanting to a Band-Aid on a bullet wound.  We’ve already been through at least half a dozen steps, and they have all failed.  We’re way beyond “step one” already.  It’s time to demand that our legislators stand up to the opposing lobbyists, stop playing politics, and do their job.

It’s up to us, folks.  What do you want?  Elimination, or another reduction scheme?  You’re going to get one of them.   Please join us in the fight for elimination.

 

Ron Boltz

VP-PA Liberty Alliance

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