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Senate Co-Sponsorship Memoranda
Senate of Pennsylvania
Session of 2025 - 2026
Regular Session
MEMORANDUM
| Posted: | December 10, 2024 12:34 PM |
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| From: | Senator John I. Kane and Sen. Carolyn T. Comitta |
| To: | All Senate members |
| Subject: | Taxpayer Fairness – Reforming School Property Tax Rebalancing for Multi-County School Districts |
| There are 88 school districts (18% of all PA school districts) that are situated in two or more counties. There is specific language in the Public School Code (section 672.1) that requires these multi-county school districts to artificially rebalance property tax millage rates among their counties (up or down) annually pursuant to a handful of proscribed methodologies. The results of this artificial rebalancing process can be negative for taxpayers and school districts. This rebalancing requirement process precedes the application of Act 1 index caps, which is unfair to many taxpayers. For example, current law and artificial rebalancing often: 1. Creates unfairness in tax rate changes and burden across residents within the same school district; one county’s residents can experience a tax rate increase while taxpayers in the other county/counties experience a decrease. 2. Makes it impossible for a multi-county school district to pass a 0% tax increase across all its taxpayers. Even if a school board approves a 0% tax increase, the mandated rebalancing process will require a tax increase for taxpayers in a portion of the district. 3. Eliminates the Act 1 cap for taxpayers in multi-county school districts, and the required rebalancing process can result in tax increases that exceed the Act 1 index for some taxpayers. 4. Eliminates the ability of multi-county school districts to benefit from natural growth in assessed value. This often serves to increase the need for property tax increases to cover the revenue lost in assessed value growth. 5. Removes the capability of locally-elected school boards to control property tax rates as is permitted in single-county school districts. To benefit taxpayers and school districts, section 672.1 of the Public School Code can be modified to provide an additional option for multi-county school districts each year. This option, if selected, would ensure taxpayers are treated more equitably and would eliminate the need for artificial rebalancing. Multi-county school districts and their taxpayers would be treated like single-county school districts, with Act 1 defining property tax limitations. This proposed legislation creates an option to ensure that all taxpayers in multi-county school districts would be treated uniformly by allowing the school directors to set the millage rate change at a uniform rate for the entire district. It would also ensure that a multi-county school district could truly implement a 0% tax increase and truly not increase property taxes through the artificial rebalancing process for some taxpayers. The proposed option to treat multi-county school districts and their taxpayers like single-county school districts is just an option—multi-county school districts can continue to rebalance under current law if that is most beneficial to taxpayers and the district. Attached is a pdf that shows examples of how the proposed change would work. Please join us in co-sponsoring this legislation to help taxpayers in multi-county school districts. |
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Memo Updated: December 10, 2024 12:42 PM