It lacks votes, but Wag­ner prom­ises to end school taxes

Or­ga­ni­za­tions wor­ried about who will pick up shift­ing bur­den

The Republican Herald - - LOCAL - BY MARC LEVY

HARRISBURG — Scott Wag­ner, the Repub­li­can gu­ber­na­to­rial can­di­date in Penn­syl­va­nia, had a mes­sage for Vic­to­ria Clark when she told him that she is down­siz­ing from her four- story home, partly be­cause of the mort­gage.

“Un­der my plan, your school prop­erty taxes will go away,” Wag­ner told Clark dur­ing a stop at her drive­way sale while can­vass­ing in her sub­ur­ban Harrisburg neigh­bor­hood ear­lier this month.

End­ing the abil­ity of school boards to col­lect bil­lions of dol­lars in prop­erty taxes is one of Wag­ner’s most prom­i­nent cam­paign planks, one that he con­sis­tently ad­vo­cates as a salve for over­bur­dened tax­pay­ers and fixed- in­come el­derly strug­gling to keep their homes.

Elim­i­nat­ing more than $ 13 bil

lion in school prop­erty taxes col

lected statewide has been a cause for some law­mak­ers in Penn­syl­va­nia for well over a decade. And while Wag­ner crit­i­cizes the man he’s chal­leng­ing, Demo­cratic Gov. Tom Wolf, for fail­ing to fight for it, a lead­ing plan in the Leg­is­la­ture that Wag­ner backs has long lacked sup­port in both cham­bers.

“Here’s the bot­tom line: ev­ery­body has the abil­ity to go to the poll on Nov. 6 and vote for me for gov­er­nor and it will get it done,” Wag­ner told a fo­rum on school prop­erty taxes in Wilkes- Barre last month.

For years, law­mak­ers sym­pa­thetic to the cause have tried, and failed. Un­re­solved fights in­clude how to raise the money to re­place school prop­erty taxes. Op­po­nents in­clude prom­i­nent or­ga­ni­za­tions, such as the Penn­syl­va­nia Cham­ber of Busi­ness and In­dus­try — which en­dorsed Wag­ner for gov­er­nor — and the Penn­syl­va­nia School Boards As­so­ci­a­tion.

Prop­erty taxes play an out­size role in pay­ing for Penn­syl­va­nia’s pub­lic schools be­cause Penn­syl­va­nia plays one of the small­est pro­por­tional roles of any state in help­ing to foot the bill.

It is 45th out of 50, sup­ply­ing less than 38 per­cent of to­tal rev­enue, ac­cord­ing to fed­eral data from 2016. It is a dy­namic that crit­ics blame for driv­ing in­equities be­tween fund­ing lev­els in poorer and wealth­ier school dis­tricts.

Ex­ist­ing pro­pos­als to re­place the lost money re­volve around the po­lit­i­cally thorny con­cept of in­creas­ing state taxes on in­come and sales, money that the state would then dis­trib­ute along with bil­lions in aid it al­ready sends to school dis­tricts.

Busi­ness or­ga­ni­za­tions worry about small busi­nesses pick­ing up a dis­pro­por­tion­ately large share of the shift­ing tax bur­den. School boards worry about los­ing fi­nan­cial con­trol to the state, giv­ing up a re­ces­sion- proof rev­enue source and be­ing stuck with a state govern­ment un­will­ing to ad­e­quately un­der­write dis­trict costs.

Then there’s the mas­sive wealth trans­fer — from av­er­age tax­pay­ers to wealth­ier school dis­tricts — if school prop­erty taxes are re­placed with higher state taxes on in­come and sales.

An As­so­ci­ated Press anal­y­sis of state data found that 75 per­cent of school prop­erty taxes were col­lected by school dis­tricts in the top half of av­er­age house­hold in­come in 2016- 17, the lat­est data avail­able. Half of all school prop­erty taxes were col­lected by the wealth­i­est quar­ter of school dis­tricts.

“So con­se­quently, it al­most in­sti­tu­tion­al­izes the in­equities that are out there,” said Mark Dirocco, ex­ec­u­tive di­rec­tor of the Penn­syl­va­nia As­so­ci­a­tion of School Ad­min­is­tra­tors.

For his part, Wolf floated a $ 3.2 bil­lion plan in 2015, his first year as gov­er­nor, and said last month that he had not seen a bet­ter plan.

Un­der Wolf ’ s plan, most of the money — just over $ 2 bil­lion — goes to dis­tricts in the bot­tom half of av­er­age in­come, but the pro­posal went nowhere in the Repub­li­can­con­trolled Leg­is­la­ture.

Wolf has, at times, said he sup­ports elim­i­nat­ing school prop­erty taxes, but he also said last month that he wants dis­tricts to main­tain au­thor­ity over school fi­nances while mak­ing the state “a bet­ter part­ner than they are now.”

Elim­i­nat­ing school prop­erty taxes would put Penn­syl­va­nia in a small group of states — in­clud­ing Arkansas, Ver­mont and Hawaii — in which there is lit­tle lo­cal fund­ing role.

It’s not clear that elim­i­nat­ing school prop­erty taxes would nec­es­sar­ily threaten the qual­ity of schools.

Rut­gers Univer­sity ed­u­ca­tion pro­fes­sor Bruce Baker, who stud­ies inequal­ity in pub­lic school fi­nance, said school qual­ity is less about the source of the fund­ing and more about the cu­mu­la­tive amount of state and lo­cal fund­ing.

Back at the drive­way sale, Wag­ner didn’t ex­plain to Clark how he would elim­i­nate prop­erty taxes as gov­er­nor, Clark didn’t ask and the con­ver­sa­tion moved on to an­other topic.

Wag­ner left, say­ing an aide would call Clark to dis­cuss his prop­erty tax plan.

But, Clark said, no­body ever called.

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