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For Immediate Release
April 29, 1998

White Says School Property Tax Bill is a Good Beginning, But Not Enough

Harrisburg - A school property tax bill approved by the Senate today is a good beginning, but much work remains to be done on local tax reform, said Sen. Mary Jo White (R-21).

The measure, known as the Taxpayers' Local Control Act, would authorize school districts to eliminate nuisance taxes and reduce property taxes by giving homeowners an exemption on a portion of the assessed value of their primary residence, or "homestead property." In return, schools could implement an earned income of tax of 1.5 percent.

White said she voted for the bill, but added the Legislature needs to go further to deliver genuine local tax reform.

"I would have liked to have seen a wider menu of tax options, and a plan that included counties and local governments. I have been assured that this is a first step in the process," said White.

Under the bill, the switch to the new taxing system is entirely voluntary and would have to be approved by local voters. In addition, if a new system were adopted by a school district, most future property tax increases would also be subject to voter approval - a so-called "back end referendum."

The senator noted that in November, state voters overwhelmingly approved a referendum allowing school districts to lower property tax rates for homeowners through a homestead exemption.

The change was necessary because the state constitution now requires residential, commercial and industrial property to be taxed evenly. The Taxpayers' Local Control Act would implement technical provisions of the Homestead Exemption.

"This bill gives shape to the Homestead Exemption and permits school directors to implement it with local voter approval."

While not perfect, White said she supported the measure because it will provide the first major reform of the local tax system in three decades and relieve the property tax burden on many homeowners.

She noted that the act also includes a Local Taxpayer's Bill of Rights to provide protections to taxpayers when they have to deal with local taxing authorities.

"School districts will have to look carefully at this bill to see whether they can offer meaningful relief to homeowners. They would be able to implement an earned income tax to make up the revenue," said White.