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Senate of Pennsylvania
Session of 2015 - 2016 Regular Session


Posted: May 21, 2015 11:47 AM
From: Senator Donald C. White
To: All Senate members
Subject: Taxpayer Empowerment and Accountability (TEA) Act
Soon, I will introduce legislation known as the “Taxpayer Empowerment and Accountability” or “TEA” Act, which would require any future real estate tax increases levied by school districts to be ratified by voter referendum. I believe taxpayers must be empowered by having the final decision on real estate tax increases through a referendum process that cannot be bypassed by allowing for inflationary increases or automatic exemptions for certain costs.

I introduce this legislation in the context of the broader debate over property tax relief. If the General Assembly and Governor Wolf move to address this issue in the coming weeks, it must be done with the assurance that voters have greater authority over, and accountability for, future school real estate tax increases.

Without a strong voter referendum in place, school districts will be able to continue raising taxes despite any efforts we make to increase education funding, restrain pension contributions and provide property tax relief to homeowners. For us to enact such reforms without ensuring the taxpayer relief that is promised remains in effect is tantamount to rearranging deck chairs on the Titanic. Cost containment must be part of the property tax relief solution, otherwise the relief provided will be short-lived. If the voters believe an increase in their real estate taxes is warranted to fund their schools, they should be empowered with making that decision recognizing they are also accountable for the increased tax burden.

•11 states give no direct taxing authority to school districts and the districts are dependent on the state or local governing body for tax levies.
•3 states set and mandate the rate of taxation imposed by a school district.
•7 states require school budgets to be approved in a referendum vote.
•34 states require a school district, or local governing body under certain circumstances, to hold a referendum vote in order to approve the levy of school taxes or an increase in the rate of taxation.
•19 states require a school district, or local governing body, to hold a referendum vote if the proposed tax increase would exceed a designated tax rate cap.

While opponents of real referenda claim voters will always reject tax increases, data from other states that require voter approval of such increases do not support that view. In fact, evidence clearly shows that voters are willing to approve school tax and spending increases when they are convinced they are worthwhile and will be used responsibly. My legislation not only empowers voters, but makes them more accountable for the educational environment in their own communities, while requiring school districts to convince the public the product being provided is worth additional taxpayer investment.

Please join me in giving Pennsylvania voters the right to have real control over real estate taxes by allowing them to decide—through referendum—if additional revenue is needed. If you have any questions, please contact Anne Achenbach at 787-4404 or at aachenbach@pasen.gov.

Introduced as SB909