Southern York County Life

Jason, while you make some good idealistic points, here are some of my thoughts on them.

1. The money stays local from the time it leaves my paycheck.

If the money stays local then the assumption would be that every district would have to pay its own way. Here are the population figures for our district and the budget figures. Granted business taxes are not included in the revenue generation that I put together, but it is a good rough draft. This assumption also goes with every person that resides in the district that is not in school (less the 7% unemployment rate) will be paying this tax and we know that not every non-pupil is employed.  Many are retired, many are stay at home moms or dads and some just do not work because they do not need 2 wage earners in the home.

Population Figures from Census
Cross Road 518
Stewartstown 1752
Delta 741
Fawn Grove 463
Hopewell 5062
E Hopewell 2209
Fawn TS 2727
Peach Bottom 4813
Total Population of District 18285
Students Approx # Enrolled 3000
Approx # Over 18 15285
State Unemp Rate 0.07
Approx # of Taxpaying Workers 14215
SESD Budget $49,000,000.00
Amt. Per Taxpaying Worker to Cover Budget Locally (if all non-pupils are wage earners)
$3447.05

2. Local or county governments decide the type of taxes as well as the amount of each tax to be paid and they could pick any type of the common taxes that is the best mix for their jurisdiction.

Can you imagine the bureaucracy that this would create? You would have lobby’s from every group from the AARP to the ACLU hitting local governments to try to have “their people” protected. I see your point, but making this kind of decision that granular is not good for anyone.

3. School districts compete for communities’ children (i.e. money).

If you are endorsing a voucher program here, I am with you. The question would be if we implement # 1 and #2 of your ideas, where do the vouchers come from? You know the SESD or any other district will not want to lose “their money” (really our money) to another district via a voucher. If you consolidated all of the York County School Districts and created schools with targeted education focuses similar to Baltimore County, this may work though.

4. Allow communities and schools to take advantage of the free market just like businesses do.

I agree with this statement wholeheartedly! The first thing we have to do is eliminate unfunded federal and state mandates that tell our school district what to do, when to do it and who to do it to! That would also knock a tremendous amount off of the bottom line of the budget making #1 more manageable.  On a side note, I wish that businesses operated in the free market in this country.  They too are mired in government regulations!

And, Happy New Year!

markG - 06 January 2012 09:33 AM

Jason, while you make some good idealistic points, here are some of my thoughts on them.

1. The money stays local from the time it leaves my paycheck.

If the money stays local then the assumption would be that every district would have to pay its own way. Here are the population figures for our district and the budget figures. Granted business taxes are not included in the revenue generation that I put together, but it is a good rough draft. This assumption also goes with every person that resides in the district that is not in school (less the 7% unemployment rate) will be paying this tax and we know that not every non-pupil is employed.  Many are retired, many are stay at home moms or dads and some just do not work because they do not need 2 wage earners in the home.

Population Figures from Census
Cross Road 518
Stewartstown 1752
Delta 741
Fawn Grove 463
Hopewell 5062
E Hopewell 2209
Fawn TS 2727
Peach Bottom 4813
Total Population of District 18285
Students Approx # Enrolled 3000
Approx # Over 18 15285
State Unemp Rate 0.07
Approx # of Taxpaying Workers 14215
SESD Budget $49,000,000.00
Amt. Per Taxpaying Worker to Cover Budget Locally (if all non-pupils are wage earners)
$3447.05

2. Local or county governments decide the type of taxes as well as the amount of each tax to be paid and they could pick any type of the common taxes that is the best mix for their jurisdiction.

Can you imagine the bureaucracy that this would create? You would have lobby’s from every group from the AARP to the ACLU hitting local governments to try to have “their people” protected. I see your point, but making this kind of decision that granular is not good for anyone.

3. School districts compete for communities’ children (i.e. money).

If you are endorsing a voucher program here, I am with you. The question would be if we implement # 1 and #2 of your ideas, where do the vouchers come from? You know the SESD or any other district will not want to lose “their money” (really our money) to another district via a voucher. If you consolidated all of the York County School Districts and created schools with targeted education focuses similar to Baltimore County, this may work though.

4. Allow communities and schools to take advantage of the free market just like businesses do.

I agree with this statement wholeheartedly! The first thing we have to do is eliminate unfunded federal and state mandates that tell our school district what to do, when to do it and who to do it to! That would also knock a tremendous amount off of the bottom line of the budget making #1 more manageable.  On a side note, I wish that businesses operated in the free market in this country.  They too are mired in government regulations!

And, Happy New Year!

Hi Mark, Happy New Year to you.

Some great points.  Thanks for taking the time to answer.  Let me just make some quick comments.

for #1.  I’m assuming we would still get some federal money as that system would be much harder to change for now.  As for the state, if we are picking up the bill the state does not have to.  So theoretically we could cut state taxes about about 30% or eliminate the state sales tax all together.  So the median household income in PA of $49,501 take away so went on to a calculator and assumed two dependents got $1,485.03 so
$3447.05 - 445.51 = 3001.54.  Now subtract for the federal help $14,715,488.00/49,000,000 or 30% so remove another 445.51 and we get $2,556.03 additional per tax paying worker.  Weather that is more or less than you are paying now depends on your household situation.  Also see #3 for a chance to reduce this further. Compare this to what you are currently paying in property and sales taxes combined.

#2.  I’m a software engineer, so I am assuming the county will use it’s current infrastructure to calculate the taxes and send out the money it collects to the proper borough/twp/city as I believe it currently does so there would not be a change in that particular process it would just be an addition to the process.  Technically and logistically it does not seem that bad to me.

#3 Not really vouchers per se.  Districts would submit bids to borough/twp/city councils.  They would make the decision where children in that community would go to school.  (It sure would make local elections more meaningful).  So not really vouchers.  As for where the money would com from, see #2.

#4.  Agreed.  Deregulation is important but I think we have to be creative about bringing in funds by other means.  Costs will go up and children will need to be educated so we will always need to get more revenue in from year to year.  I’ve often said they should create a Community Non Profit type of business.  You can start a non profit just like any other non profit.  The stipulation is that you have to give profits to the school/community you are operating.  You have to run a business that provide the community with any product or service the community is lacking and profits would go back into the community it is serving.  Like the kiosk I mentioned or perhaps a community wireless service, or perhaps a power generator/distributor (some even small communities have their own power generation and/or distribution), manure processing plant, recycling plant, adult educational services, computer education services, etc.  They would be run privately but like other non profits their profits would be regulated as to how they could be used.  This would help even further bring down the number calculated in #1 above - perhaps drastically.

Cheers!

Jason - 31 December 2011 07:09 AM

Even if you put all that aside, it doesn’t seem realistic too me that for folks that really are struggling to pay their property taxes, won’t be struggling to pay the new fees and taxes.  Considering we’re talking around $11B here or a 40% increase in state revenues, there is going to be pain felt by almost everyone but especially by those who can’t legitimately pay their property taxes as it is usually those folks who feel the pain the most for any tax shifting.  Not that I want there to be but if there is not pain, then this plan probably cannot pay for itself.

The difference here is that people can control what they buy, thus they control the amount of sales tax they pay.  They can’t control how much their school property taxes are. 

Noticeably missing are higher tobacco and alcohol taxes as well as taxes on capital gains and say fees on Marcellus Shale drilling companies.

First of all, I think cigarette smokers are already unfairly taxed (the PA Excise tax is $1.60 per pack, or $16 per carton), however, sales tax is added to the bottom line of tobacco products (so the excise tax is taxed).  The sales tax will increase on tobacco products.  And all liquors sold by the PA Liquor Control Board are subject to an 18% tax.  There had been some early discussions about various other sources of funding, but it started getting complicated.  Therefore, to keep it simple and have the best chance of passage, HB1776 is what it is. 

To put all this into perspective, if YOU DID NOT add in the newly taxed items and just increased the sales taxes on existing items it is EQUIVALENT to a 13% sales tax - more than double what we are paying now.

I have no idea how you came up with a 13% sales tax.  It will be 7% on the items that are taxed.  You can’t finagle 7% into 13%.

1. What I have in bold actually generates the revenue it is supposed too (and I still think that is a bit questionable)

Spreadsheets from the House Appropriations Committee staff definitely indicate that the expansion of the sales tax base will generate sufficient revenue to completely eliminate school property tax for all entities.

2. Future state legislatures and governors don’t find a way to use this money to “balance the budget”, come up with tax breaks, or come up with new programs we are in good shape.  After all look at where many recent cuts at the state level came from (not too much of a stretch as to what will eventually happen there).

The Property Tax Independence Act calls for a dedicated lockbox account for all property tax replacement revenues that is separate from the General Fund. All replacement funding for the schools will be disbursed from this account through the existing Department of Education funding mechanism, requiring no growth of the current infrastructure.

3. Future state legislatures and governors don’t start putting political/social requirements on school funding

See answer to #2 above.

4. Philadelphia, Pittsburgh, and the Lehigh Valley doesn’t eventually end up with a disproportionate amount of revenue

At enactment of The Property Tax Independence Act, all districts will receive 100% funding sufficient to meet all financial obligations. A per-student expenditure level will be determined for each district and will be re-calculated annually. Each school district will then receive annual upward or downward funding adjustments based on changes in student enrollment multiplied by the current per-pupil cost.  At enactment of The Property Tax Independence Act, existing long-term debt will remain with each school district for them to service individually. Philly and Pittsburgh have high debt - not sure about Lehigh.  Because of this a remnant of property tax will remain past the two year elimination phase-in but ONLY the amount of property tax necessary to meet current annual debt service. When that existing debt is retired the final bit of property tax will disappear and no further property taxes will be allowed.

here is who will make out from this bill:

See the 10 Reasons to Eliminate:  http://www.ptcc.us/tenreasons.htm Or:

- Homeowners will benefit from the restoration of true property ownership and unprecedented financial freedom without the economic oppression of rising school property taxes.

- Farmers will not have to sell family properties that have been handed down through generations.

- Senior citizens will no longer be forced to sell their homes or be evicted from their homes due to school property tax bills they can no longer afford to pay.

- More young couples and renters will benefit from the prospect of qualifying for home ownership because of no school tax escrow and, thus, lower monthly housing payments.

- The elimination of the school property tax will help to attract new business, create jobs, and restore Pennsylvania’s economic vitality.

Here is who will pay for the bill:

Anyone who purchases taxable items, whether it be homeowners, renters, tourists, teenagers, businesses, etc.

Just IMO, there are some better ideas than this out there.

Like what?

Jason - 06 January 2012 04:44 AM

Marge - 05 January 2012 01:32 PM

Jason...you have never been in favor of eliminating school property taxes; your arguments don’t hold water, but since we have been through this many times in the past, I won’t waste my breath.  We both know how the other feels. 

Marge, with all due respect I don’t think you know how I feel - from your statement.  I want to see property taxes go but I want it done the right way.  I don’t want money to be passed up to the state, siphoned off, then trickled down again.  As you know, I grew up in Pennsylvania.  I want reform, I just want it to be fair for all Pennsylvanians.  Since I was a kid, we have been hearing about property tax reform.  Of course politics stops it.  That’s the mechanism by which our democracy works.  To just keep saying it’s politics means that you are brushing off the concerns folks like me have on this issue.  Many of the concerns I have expressed is what concerns a lot of people about the bill, and those concerns translate into - yes - politics.

To me the ideal situation would be:

1. The money stays local from the time it leaves my paycheck.
2. Local or county governments decide the type of taxes as well as the amount of each tax to be paid and they could pick any type of the common taxes that is the best mix for their jurisdiction.
3. School districts compete for communities’ children (i.e. money).
4. Allow communities and schools to take advantage of the free market just like businesses do.

I’d also like to see a little creativity.  Perhaps: continue to promote cyber education then promote semi-private kiosks with an aid or two on site to help some of the kids out 2 or three days a week.  It is also somewhere for them to go and do school work if both parents are away for a few hours.  This could be one of those non profits where money can be passed on to the school or other community projects.  Part of it could be closed off and used as an office for telecommuters.  Good or bad it is just one idea.  Folks much smarter than me could probably come up with dozens.  Each one better than the last.  Things are going to get tough down the road,.  We can’t continue to rely on taxes and/or state/federal government to ride in on a white horse.  Not only don’t they have the money but they may be on the verge of systemic and perhaps in the medium to longer term political collapse themselves.

Jason, I apologize if I’ve misunderstood you all these years.  I know you don’t want to ‘lose local control’, whatever that is, since I can’t see where we have any local control.  You have pointed out more than once that you feel the school property tax is an issue unique to this area.  In one post you stated, “Family and friends I have in other parts of the state basically tell me ‘if your property taxes are too high, buy a smaller house’”.  In another, you said, “I don’t like the property tax system either; it at least needs to be supplemented by some other methods and the state needs to get out of the districts’ hair and allow them to fund it any way they see fit.” You want to give the schools carte blanche?  Further, you have said you “believe the entire community should fund the schools.  (You) believe the funding should be local.” I guess I didn’t get your drift here. 

I want to clarify that I did explain what I meant by ‘politics’ in that post - the way Rohrer presented the bill rubbed some folks the wrong way.  I don’t brush off others’ concerns, but you and I have been through this many times over the years and I feel like I’m just repeating myself because I haven’t changed my mind on this issue.  As far as syphoning, see my previous post - lockbox account.

Jason, you and I are just going to have to continue to agree to disagree.  No hard feelings on my part.  If everyone thought the same way, life would be boring. 

Great conversation - thanks Marge for responding. 

Yes as you know ‘local control’ is important to me.  Local control to me means that localities have as much say in their economic, political, social, and environmental futures as posssible without interference from Harrisburg and Washington to the extent that those rights do not impede on policies and/or rights in other localities or any citizen.  It also means though that we actually hae to take some responsibly. 

I also don’t believe politicians respect ‘lock boxes’.  If they did we wouldn’t have issues with social security - well not as much as we do now.  At the state level, Democrats I believe will try to eventually put mandates around this and Republicans will try to find a way to use the money to fund tax breaks for the wealthy and for large companies that are already swimming in cash but still not hiring anyone.  I don’t trust them to do the right thing over time and I don’t believe in opening up a Pandora’s box to many people whom I don’t believe have anyone’s best interest at heart except for their own. 

For instance, I remember saying on this forum that I never believed most of the the gambling revenues will ever make it to schools.  I did remember though that some surprised or at least disappointed. I just always took it as a given.  Also keep in mind that when we were doing the SYCP interviews I had to play devil’s advocate with you and Pat to keep the conversation flowing and allow you to get your views out.

Remember the creationism debate that occurred in (I believe it was) Dover?  Imagine if that would have happened at the state level instead of Dover determining what/how THEIR kids are to be taught?  Not right now this would not happen right after the bill would be passed but 5, 10 15 years down the road . . . ?  If The state is in charge of the purse strings they are ultimately in charge of every aspect within that context.  The community of Dover decided without any interference from H’burg or even a whole lot of grandstanding from state politicians.  A local issue resolved locally based on the prevailing culture of the community.  They simply don’t believe that for the most part their local government has more oversight than state government.  I think it really is that simple for them and being in the same boat as them I guess i sympathize with that position.

Marge - 06 January 2012 11:30 PM

… I know you don’t want to ‘lose local control’, whatever that is, since I can’t see where we have any local control.  You have pointed out more than once that you feel the school property tax is an issue unique to this area.  In one post you stated, “Family and friends I have in other parts of the state basically tell me ‘if your property taxes are too high, buy a smaller house’”.  In another, you said, “I don’t like the property tax system either; it at least needs to be supplemented by some other methods and the state needs to get out of the districts’ hair and allow them to fund it any way they see fit.” You want to give the schools carte blanche?  Further, you have said you “believe the entire community should fund the schools.  (You) believe the funding should be local.” I guess I didn’t get your drift here. 

I’d like to have more local control but I think we still have more local control in PA than we do in states like MD.  First it’s not that many of my family and friends in other parts of the state wouldn’t like to see the property tax problem fixed, its just hat they don’t like the alternatives. They don’t trust Harrisburg to get anything right and they don’t want to make a bad situation worse.  It is a case of ‘the devil you know’.  And other issues trump it in those places where here it is always the big issue.

By funding any way they see fit I meant in method not in quantity, I meant opening up the menu of taxes other than property taxes.  Essentially #2 from the previous post.  They would be given the choice of property taxes, and/or income, capital gains, growth and expansion fees, sales taxes,etc.  If a district wanted to eliminate property taxes they could.  Though to keep cost down I’d rather see the taxing body be boroughs and townships and have districts ‘bid for their business’ as in #3 above. 

I think this area does concentrate on this issue a lot more than others that I am familiar with - no doubt about it.  I think there are more urgent issues involved in this school district and even the community now to deal with.  Not that this should not be discussed it’s just that conversations on things like the football locker room incident which I have heard from relatively reliable sources that it is not just rumor, is the board showing the full costs of legal fees in the ongoing legal battle in the Shank case, there were sparks and smoke in the boiler room at West the other day and the kids had to leave the building, how effective is the citizen’s advisory committee, etc are deafening.  If the old board were still in office there would be no end to complaining on this forum over these issues and some of them may even wind up in the newspaper.  Its not just property taxes but any kind of local taxes.  Where folks in many if not most communities where people have lived in PA their whole life, rightly or wrongly, see these local taxes as a necessary evil.  That is probably one reason they are sensitive to proposals like this.  What do i want to pay all these taxes for schools and potentially give up more control to the state.  Even if only a little bit.  I think it is just a culture thing - what are you used to growing up.

As far as all funding should be local, in general any offset in tax increase we get locally by states or feds removing a mandate or removing funding all together, there should be a corresponding drop in the taxes at the federal and/or state level.  Realize it may not always be 1:1 but sometimes we would make out and other time we would loose.  But with new rights, privileges, and freedoms comes a new responsibility.  That’s the classic trade-off - is it not?

As far as what other ideas, I believe if you still have the SYCP episode we did with the PSU folks you may have heard some.  There’s the one i proposed on this thread which may at least be a starting point.  Over the years growing up I have heard a few suggestions, also as I said there are people out there who are smarter and more creative than I that I am sure could come up with more ideas.

Marge - 06 January 2012 11:30 PM

Jason, you and I are just going to have to continue to agree to disagree.  No hard feelings on my part.  If everyone thought the same way, life would be boring. 

Always enjoy talking to you Marge

The difference here is that people can control what they buy, thus they control the amount of sales tax they pay.  They can’t control how much their school property taxes are.

Of course they control what they buy.  You control what home you buy just like you control anything else you buy.  You have to figure the cost of property taxes into what you can afford.  So far as keeping tax money local, what that means to me is that my tax money is going to fund our school and our children.  If another school has a pool , etc. that our school does not, why do I want my money paying for that?

JT - 07 January 2012 09:24 AM

The difference here is that people can control what they buy, thus they control the amount of sales tax they pay.  They can’t control how much their school property taxes are.

Of course they control what they buy.  You control what home you buy just like you control anything else you buy.  You have to figure the cost of property taxes into what you can afford.  So far as keeping tax money local, what that means to me is that my tax money is going to fund our school and our children.  If another school has a pool , etc. that our school does not, why do I want my money paying for that?

Yes, you can control the home you buy, but you can’t control reassessments and ever-increasing school property taxes.  If our students are getting everything they need, who cares if another school has a pool or not?  Here is an economist’s take on property tax:

Dr. Mark W. Hendrickson
TIME TO ABOLISH ANTIQUATED PROPERTY TAX

Property taxes in Pennsylvania appear locked into a long-term uptrend. In recent years, there have been huge increases in the portion of the property tax that finances county government. County officials have levied these increases to pay for the unfunded mandates imposed by the state government in Harrisburg . The largest share of the property tax funds the public school districts, and virtually nobody foresees a time when the expenditures of those districts will stop rising. These ongoing pressures for additional tax revenues raise the question: Is it politically and economically feasible to continue raising property taxes in the coming years?

Some might look at the results of a recent ballot proposal in Lawrence County and conclude that Pennsylvanians prefer a property tax over others types of taxes, but this conclusion is unwarranted. When offered the opportunity to receive a modest reduction in the public-school portion of their property tax in exchange for a 1 percent increase in their earned income tax, voters in every school district in the county overwhelmingly voted against it. The context here is crucial. Voters were not opposed to property tax relief, but to a package deal that represented an overall tax increase.

We have a political stalemate in Pennsylvania, because Harrisburg has mandated that the only permissible reform to public-school funding must be structured like the Lawrence County proposals. The psychology is all wrong. It’s hard for voters to get excited about a proposal that makes an obnoxious, already-high tax just a little less high (i.e., the property tax) at the price of ratcheting up another obnoxious tax—the income tax—when the federal/state/local taking of income is already at an uncomfortable level. If Harrisburg really wants reform, it needs to emulate the boldness of the Michigan government in the 1990s, when it totally scrapped the property tax for school funding, and replaced it with a 2 percent hike in the state sales tax. I suspect that Pennsylvania voters would be far more comfortable with an increase in one type of taxation if it were offset by the complete removal of another type of taxation. If you give Pennsylvania voters the chance to eliminate one part of their tax bill completely, then tax reform has a fighting chance for approval.

The larger, more fundamental problem here is the property tax itself. This form of taxation is totally antiquated, appropriate in America’s 19th-century agrarian society, but out of place today. In the 1800s, when there was no income tax and it was considered none of the government’s business how much money anybody made, the property tax served as a proxy for one’s income. This made a lot of sense then, because it was logical to assume that the citizen farming 80 acres had a higher income than one farming only 40 acres. Today, though, the homesteads of most Americans are not their source of income, but merely where they live. Why, then, take more money from a citizen with a house of 1,500 square feet than one with 900? One of the elementary principles of prudent taxation is that, in order to avoid harming citizens, taxes should take into consideration the individual’s ability to pay. Today, one’s ability to pay depends far more on one’s income than on the size of one’s house. To continue taxing people as if their house were generating their income is absurd.

An additional fault of the property tax is that it can jeopardize home ownership. On the surface, it appears that once a person has paid off the mortgage on his house, then he owns it free and clear, but this is not so. If the homeowner falls on hard times and can’t pay his property taxes, the sheriff comes and confiscates the house. Under the present system, a person doesn’t really “own” his home completely, but in effect rents it from the local government which permits him to keep it only so long as the “owner” continues to pay taxes on it. We have heard of senior citizens—wonderful, law-abiding citizens who worked hard for decades to buy their own home—having to sell their home because they couldn’t afford the taxes. This is abominable. And how many of America’s homeless persons became so because they fell on hard times and were evicted from their homes because they couldn’t pay their property tax?

In an era when it has been the federal government’s policy to facilitate home ownership as a central feature of “the American dream,” it is anomalous for local governments to make it difficult for some citizens to keep their homes. The property tax is outmoded, unfair, irrational and destructive. It’s time to abolish it.

Dr. Mark W. Hendrickson is a faculty member, economist, and contributing scholar with the Center for Vision and Values at Grove City College

personally the school taxes are not killing me.  i dont mind paying them i see the benefit there.  however, the cost of heating oil is whats breaking the bank.  i think right now we have alot of people who travel long distrances to work and now $3.50 a gal for gas, plus $3 a gal for heating oil and then add school taxes it doesn’t help.

not to sound like i dont want a sales tax system, i actually voted for sam rohrer, i just worry at how harrisburg treats its taxpayers.