By Andrew Staub | PA Independent
Finding a way to give Pennsylvania homeowners relief from their school property taxes is hard enough on its own, but doing it during a budget impasse that’s lurched two weeks into July is even more difficult.
While there’s some consensus on how to shift billions of dollars of school funding onto other taxes, Republican lawmakers and Democratic Gov. Tom Wolf are fighting over the budget and other complicated issues, such as privatizing wine and liquor sales, public pension reform and more taxes on the gas-drilling industry.
Adding property tax reform to the list might be putting too much on the plate of a Legislature that will never be accused of moving quickly, said G. Terry Madonna, a political science professor and pollster at Franklin & Marshall College.
“I think it’s the least likely of all the things that are being discussed to take place because you don’t have to have the budget contingent on it,” he said.
Wolf vetoed a GOP budget that didn’t raise taxes and ignored his top priorities, property tax relief among them. He also vetoed a Republican liquor privatization plan and followed that Thursday with a veto of the party’s pension reform bill, a move that only further inflamed discord at the Capitol.
It all overshadows the fact that lawmakers and Wolf have staked out some common ground on the property tax issue, no matter how rough the rhetoric gets.
There are four property tax relief proposals in play, including Senate Bill 76, which would eliminate the hated levy. Each has its own intricacies, but all would raise the statewide personal income and sales taxes to shift at least some of the school funding burden onto those revenue streams.
Only one — Wolf’s plan — has been inserted into a budget proposal. The House rejected that tax plan June 1.
In floor remarks made before the June 30 budget deadline, Senate Majority Leader Jake Corman, R-Centre, said his caucus is the only one pushing for the total elimination of property taxes, but that such reforms should be considered outside of a general fund appropriations bill.
This week, when talking about the budget impasse, Corman told PennLive that Republicans weren’t open to discussing an income or sales tax increase to get a deal done with Wolf. It was a curious stance given his caucus’ supposed support of a plan that raises those very taxes to eliminate property taxes.
There’s a caveat, said Jennifer Kocher, Corman’s communications director. A portion of the tax increases Wolf wants would remain in the general fund. While a tax swap has support, Corman would not support tax hikes for increased government spending, she said.
“That’s why we don’t have it as part of our discussion at this point,” she said.
Wolf’s budget proposal calls for $4.5 billion more in taxes. Of that, about $3.9 billion comes from raising the sales tax and personal income taxes, with $2.1 billion dedicated to property tax relief.
“The remainder would be used to address the structural budget deficit, education spending and other important needs,” said Jeffrey Sheridan, Wolf’s press secretary.
It’s not the dollar-for-dollar property tax relief many Republicans desire.
State Sens. David Argall and Mike Folmer, two Republicans backing Senate Bill 76, met with Wolf’s chief of staff last week to see if the administration would gravitate toward total elimination. There’s been no word about whether it would happen, Argall said.
Adding to the budget impasse, Republican lawmakers have hammered Wolf’s property tax plan because it expands the base of the sales tax to cover things such as caskets and diapers. But Senate Bill 76, supported by many within the GOP, would do the same.
State Sen. Jim Brewster, an Allegheny County Democrat who supports total elimination, said those controversial newly taxed items could be negotiated out of any plan. He also supports Wolf’s plan, which the governor has said would bring a 50-percent cut for the average homeowner.
“It’s a bite of the apple that we don’t have now,” Brewster said.
Overhauling property taxes will take time and patience, Brewster said. Still, the most die-hard proponents of eliminating school property taxes in Pennsylvania are eternally optimistic about Senate Bill 76.
“There is no doubt in my mind that it’s going to run,” said David Baldinger, administrator for the Pennsylvania Taxpayers Cyber Coalition, a grassroots group supporting total elimination.
The House has already passed a different property tax relief bill with bipartisan support, and Senate Democrats have unveiled their own plan. It remains to be seen what Senate Republicans will do.
Corman has said their focus is on elimination, but as for when Senate Bill 76 might see movement, Kocher said the focus is on the budget for now.
Both the Senate and the House will return to Harrisburg for rare summer sessions this month, but there’s no end to the impasse in sight. Wolf has said he has offered up concessions only to have Republicans rebuff him.
“The refusal by Senate Majority Leader Jake Corman and Republican leaders to accept basic math and acknowledge Pennsylvania’s massive structural budget deficit is the sole obstacle preventing budget talks from moving forward,” Sheridan said.
Until the budget gets done, it seems like homeowners will wait for relief, just like they have for years.
Argall tried to offer some reassurances.
“I think we can all see some progress,” he said, “and I know to some it seems like we’ve been talking about this issue forever, but we definitely have never been this close before.”
EDITOR’S NOTE: This article was updated at 3:21 p.m. July 14 to correct an error. The state House will return to session next week.