PRINTER'S NO. 1096
No. 874 Session of 2003
INTRODUCED BY RHOADES, JUBELIRER AND BRIGHTBILL, JULY 15, 2003
REFERRED TO EDUCATION, JULY 15, 2003
AN ACT
1 Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
2 act relating to the public school system, including certain
3 provisions applicable as well to private and parochial
4 schools; amending, revising, consolidating and changing the
5 laws relating thereto," defining "property tax reduction
6 index," "school tax ratio" and "residential property tax" for
7 purposes of reimbursement by the Commonwealth and between
8 school districts; and providing for State property tax
9 reduction allocation.
10 The General Assembly of the Commonwealth of Pennsylvania
11 hereby enacts as follows:
12 Section 1. Section 2501 of the act of March 10, 1949
13 (P.L.30, No.14), known as the Public School Code of 1949, is
14 amended by adding clauses to read:
15 Section 2501. Definitions.--For the purposes of this article
16 the following terms shall have the following meanings:
17 * * *
18 (24) "Property tax reduction index." A quotient equal to
19 the sum of the numerical rank of a school district's personal
20 income valuation per average daily membership, the numerical
21 rank of its equalized millage and the numerical rank of its
1 school tax ratio, as assigned pursuant to section 2502.41,
2 divided by 1,000.
3 (25) "School tax ratio." The personal income valuation of a
4 school district divided by the total dollar value of revenue
5 derived from any taxes levied by the school district for the
6 school year two years prior to the school year in which the
7 calculation under section 2502.41 is made.
8 (26) "Residential property tax." The dollar value of real
9 property taxes paid by residential property owners in a school
10 district, determined by multiplying the real property tax
11 revenue of the school district in the school year two years
12 prior to the school year in which the calculation under section
13 2502.41 is made by the percentage of property in the school
14 district classified as residential by the State Tax Equalization
15 Board.
16 Section 2. The act is amended by adding a section to read:
17 Section 2502.41. State Property Tax Reduction Allocation.--(a)
18 By August 15, 2003, the Department of Education shall:
19 (1) Array the personal income valuation divided by the 2002-
20 2003 average daily membership, equalized millage and school tax
21 ratio of each school district in rank order and assign each
22 school district a discreet numerical rank for its personal
23 income valuation per average daily membership, its equalized
24 millage and its school tax ratio. For the numerical rank of a
25 school district's personal income valuation divided by its 2002-
26 2003 average daily membership, the school district with the
27 lowest personal income valuation per average daily membership
28 shall have the highest numerical rank. For the numerical rank of
29 a school district's equalized millage, the school district with
30 the highest equalized millage shall have the highest numerical
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1 rank. For the numerical rank of a school district's school tax
2 ratio, the school district with the highest school tax ratio
3 shall have the highest numerical rank.
4 (2) Assign each school district a property tax reduction
5 index.
6 (3) Calculate the property tax reduction allocation for each
7 school district by multiplying the school district's 2002-2003
8 average daily membership by the property tax reduction index of
9 the school district and multiplying that product by two hundred
10 sixty dollars ($260): Provided, that:
11 (i) A school district for which the allocation under this
12 subsection is less than the product of the residential property
13 tax of the school district and 0.10 shall receive an additional
14 amount so that the total allocation under this subsection is
15 equal to the product of the residential property tax of the
16 school district and 0.10.
17 (ii) A school district for which the allocation under this
18 subsection is equal to or greater than the product of the
19 residential property tax of the school district and 0.25 shall
20 receive a total allocation equal to the product of the
21 residential property tax of the school district and 0.25.
22 (4) Notify each school district of the amount of its
23 property tax reduction allocation by September 15, 2003.
24 (b) For the fiscal year commencing July 1, 2004, and each
25 fiscal year thereafter, the Commonwealth shall pay to each
26 school district a property tax reduction allocation equal to the
27 amount calculated under subsection (a)(3). Payments required
28 under this subsection shall be made pursuant to section 2517(c).
29 (c) A board of school directors of a school district of the
30 first class A, second class, third class or fourth class shall
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1 reduce any real property taxes levied for the purpose of funding
2 school district programs by an amount equal to the property tax
3 reduction allocation received from the Commonwealth pursuant to
4 subsection (b). Such real property taxes shall be reduced by
5 providing a farmstead property exclusion and a homestead
6 property exclusion under 53 Pa.C.S. § 8586 (relating to
7 limitations).
8 (d) A city council of a city of the first class shall reduce
9 any tax imposed on the wages of residents and nonresidents under
10 the authority of the act of August 5, 1932 (Sp.Sess., P.L.45,
11 No.45), referred to as the Sterling Act, by an amount equal to
12 the property tax reduction allocation received from the
13 Commonwealth pursuant to subsection (b).
14 Section 3. This act shall take effect immediately.
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