The Morning Call has a list of all the Act 1 Ballot Questions to be voted on Tuesday (read it here).
Nazareth's is as follows:
Do you favor the Nazareth Area School District providing for homestead/farmstead property tax exclusions for eligible homestead/farmstead properties by imposing an additional 0.90% earned income tax? The revenue generated from the tax will be used to reduce taxes on qualified owner occupied residential properties and on qualified farm buildings by approximately $486.00 in 2007-08 to approximately $694.00 in 2008-09. The current school district earned income and net profits tax rate is 0.70%.
What do you think? Should voters vote to enact this proposed change? Why? Why not?
11 comments:
I really don't know! I've read so many articles about this and am still very confused. If we vote to raise it, honestly - where does that money go (or where is it supposed to go)?
I look at this from a few perspectives and I am going to vote in favor of it.
It is not the best, but it is what you get based on the legislative process in Harrisburg which seems heavily swayed by lobbyist and their financial contributions.
Here is what I took into consideration:
1. It is a move off property tax and toward income based tax to support the schools. I see no fairness in taxing based on the property you own as opposed to the money you earn. It is an antiquated method based on a time when only the wealthy owned land.
2. It does not provide the NASD with 'extra' revenue, it shifts how the revenue is generated.
3. People on fixed incomes have been severely stressed financially by school property taxes. Imagine being billed $2000 and earning $15 to $20,000 for the year. It is not right.
On the flip side, renters will get hit twice, once because their rent already has the tax passed through and again when they must pay a higher income tax.
If everyone looks at this from how much they will personally pay today it is going to come down to the seniors vs. the upper middle class.
Should be interesting to see how the vote turns out.
Ross
I believe you are in error to vote for the proposal. The school district will be able to continue to raise property taxes and collect from raising the earned income taxes. Many people will be paying more under the earned income tax then under the property tax. The only way we stop the devouring dragon is to cut off his funds thus either the property taxes are eliminated or the earned income tax is. Referendum must be introduced and the budget must be placed on the ballot every year.
Harrisburg appears to be run by lobbies, and there is no lobby stronger than the PSEA. Couple that with every group and organization that is supported by tax dollars (school board associations, superintendents, ad's, every group), then services affiliated with schools (cafeterias, etc) and you will have a tough time getting anything through that will potentially dry up funding (like an annual referendum).
The exemptions are bad as well. The state approved every single one that was requested from every school district state-wide.
In the absence of another option, I'd rather see the homeowners least able to afford the taxes get the break even if it means half of us pay more.
It is not a good choice, boiling pot or fire:-(
I don't like it...not one bit...the renter reason is one primary factor...the ability for the school to continue unsustainable spending levels via exemptions is another...I am voting against it...I hope everyone else does, too!
Ross
If we truly devised a tax system where we all participated something that would cause us to have a stake in the nation, we all would benefit financially. Keep in mind that we have taken tons of people off the tax rolls and we are getting to the point where they will soon be in the majority. Do you think once that happens that we will ever again see a tax cut? Everyone, including those on Social Security which by the way increases yearly, should pay. One way to do this is come up with a flat tax or a national sales tax. Local and state governments could do the same. When we take hundreds of thousands off the tax rolls, the rest of us foot the ever increasing bill. Ronald Reagan was the president who pointed out that you will not stop spending until you get the money into the hands out of the peole and out of the hands of the government. You want to put an end to the taxing and spending, make the people pay their tax bill on a monthly basis. You'll hear the wheels of the populace go into high buzz mode, is my government really doing the job that they want me to pay for? Meanwhile Bushkill guy is correct.
The Governor has made statements in the past around the state wanted to take control of the collection and distribution of school tax dollars.
Act 1 in my opinion is the first step in making that a reality.
Right now, our local district controls the taxes, and we pay directly to the district.
If Rendell gets control of the money, you will see a massive redistribution of those tax dollars to the "poor" districts and we will only see a fraction of our dollars come back to us.
For those of you don't don't think this could happen, I say take a look at California and Proposition 13 to see the adverse effect it has had on "rich" school districts. If you think there is a lot of fundraising now, wait until that happens here.
I don't fool myself into thinking that we are going to see a lot of relief from the casino revenues. The greatest proportion of that money will go to districts in the larger cities (similar to the way reimbursements are already done).
I had a chance to pose this question to Dr. Lesky, and his response is that we get around 25% back from the state while cities like Philadelphia get close to 100%.
Act 1 is a bad idea, and with it, we are putting some degree of control over taxation into the hands of the state.
I will vote a resounding NO on it.
We can look at this on the big picture level, and the very local what we have to address Tuesday.
Big picture, I wouldn't even say pay monthly, I'd say flat earned income tax, no with-holding, make everyone come up with the money by 4/15. People view a tax return as a bonus seemingly forgetting it is their own money.
Next week, voting against this referendum does not stop the school from spending, it only prevents providing a refund to property owners earning less than roughly $50,000.
I agree the renters get hit on income, but again, my preference is to help those out on fixed income.
Everyone will pay on property and on earned income and this is set up to be a tax shift, not a tax hike, so for each who is paying more, someone will be paying less, and some will pay neither more nor less.
Glad to see the registration hasn't hindered the conversation!
Ross
If I am going to pay more, and I will, is that a tax shift or a tax hike. I believe it is a tax hike. A duck is a duck is a duck.
As for anonymous, you have hit the nail on the head. We would see nothing come back to the area. Can you just imagine all the "good will" that Fast Eddy could buy for himself dropping those checks around the state. We would never see a responsible person in that seat till the end times.
The aggregate of the revenue is the same amount making it an overall shift.
Individuals will pay different amounts and for some it will be a hike for others a break.
I think the fixed income seniors deserve relief.
My grandmother lives in town and recently I was helping her with something. She pays the same as I do in school taxes, yet doesn't have nearly the means to do so because she is in her 80s and doesn't work.
Why are we paying the same amount to the school?
Because property tax to support schools is unfair.
I'm not looking at it as what happens to my wallet, I'm looking at it to see what is most fair for all the residents.
There is a downside and that is renters. I'm not sure what portion of their rent is already a pass-through payment of property tax so its tough to say how fair their tax bill is - they will pay more.
Currently, Harrisburg is supposed to chip in some money to fund public education. But over the years, the amount that they have contributed to public schools has decreased as a total percentage of school budgets (that could be a result of school budgets outpacing inflation, but I digress). So Harrisburg has gotten bad press for what is perceived as a declining commitment to public education.
In another corner, you have people struggling to pay their ever increasing property taxes (probably because Harrisburg has not been adequately funding public education, but again, I digress).
So, Harrisburg and Fast Eddy come up with the "brilliant" idea to legalize gambling (really slot machines only) at "select" PA venues with proceeds going back to local school boards. They call it Act 72. Act 72 is soundly rejected by school boards all over PA, so they dress up the pig, and rename it Act 1.
One important aspect of Act 1 is the purported tax relief that will be coming once the gambling money starts "rolling in". Once there is enough gambling money collected ($400M), Harrisburg will begin turning money around to the local school districts. Unfortunately, Harrisburg has already stated that there will not be enough money in the pool this year for property tax relief. So where does that put schools for next years budgets? If the amount they expect to get declines or stays the same because there isn't enough gambling money in the pool, how do school boards expect to reduce (or keep increases in future property taxes) to a minimum?
Act 1 will pit community members against each other; the senior citizens and lower income families vs. renters and middle/higher income families. Act 1 could very well trigger Federal Alternative Minimum Tax (AMT) burdens for additional families (who presumably will have higher local taxes and therefore deductions).
In the end, Act 1 is seriously flawed. It won't provide "real" property tax relief because there are several exemptions that school districts can claim in any given year to increase their budgets above the inflationary rate.
Harrisburg should provide real property tax relief in the form of an increased sales tax or consumption tax.
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