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10/28/2020 02:03 AM
Pennsylvania State Senate
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=S&SPick=20190&cosponId=26810
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Senate of Pennsylvania
Session of 2019 - 2020 Regular Session

MEMORANDUM

Posted: December 5, 2018 02:28 PM
From: Senator Scott Martin
To: All Senate members
Subject: Reforming Property Tax Collection in Third Class Counties
 
In the near future, I plan to reintroduce Senate Bill 1099 as amended, which will give third class counties, and municipalities and school districts in third class counties more flexibility to utilize reliable, efficient alternatives for property tax collection.

Modernizing government functions in order to improve effectiveness and efficiency should always be something that we strive for. Many systems or positions have become outdated or are no longer needed and the Commonwealth needs to allow the option for local governments to move into the 21st Century. A few years ago, Pennsylvania provided options for the elimination of Jury Commissioner. It’s now time to look at providing options to our property tax collection system.

Currently in my home county of Lancaster, over 66% of municipalities utilize the County Treasurer to collect their property taxes because they believe it is the most efficient and cost-effective option. Every two years, these municipalities jump through hoops to find candidates who will need to pass background checks, run for the office and get elected, only then to resign. This is unneeded bureaucracy that has led to some unfortunate situations.

For example, in 2013, after years of appointing the County Treasurer to collect municipal taxes, a write-in candidate in East Lampeter Township in Lancaster County was elected tax collector by one write-in vote. Problems began almost immediately in 2014 and as of March 2017, he owed the county more than $90,000 from 2016 tax collections. This individual sent out his own property tax bills that had incorrect information and were not authorized, nor verified by the County Treasurer. The individual also ignored instructions from the County to reconcile his prior year's tax duplicates before receiving current year tax duplicates. Chaos ensued with $40,000 still owed to taxpayers for double payments, and 36 people had been sent to the Tax Claim Bureau, some of whom were incorrectly in danger of losing their property. In addition, the County and Township incurred unnecessary legal fees to get this straightened out in court.

With regard to school districts, the cooperation historically enjoyed by school districts and tax collectors was recently jeopardized by a lawsuit filed in November 2017. Manheim Township School District (MTSD) was repeatedly deputized by their local tax collector(s) and has been collecting school district taxes for over 30 years. When a new tax collector was elected in 2013, the District alleges that they reached out to the individual twice to discuss a tax collection agreement and received no response. The District continued collecting taxes and believed “the current tax collector took no steps, or showed any interest, to collect school district taxes” until a complaint against the district was filed with the Lancaster County Court of Common Pleas. The district has since spent tens of thousands of dollars in legal fees to address the lawsuit brought against them. When collecting their own property taxes, it is estimated that MTSD annually saves taxpayers $40,000, which are funds that can be used to educate their students.

It’s important to note that this legislation provides options and is not a mandate. If third class counties, or municipalities and school districts in third class counties want to utilize the services of their local tax collector, they can continue to do so without interruption. However, for those entities that believe they can collect property taxes more efficiently and effectively, my legislation would give them this opportunity with the ability to reinstate the services of a tax collector should they choose to in the future.

I hope you will consider joining me in co-sponsoring this important reform legislation.

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Introduced as SB82