Jul. 29, 2017

By Rep. Steve Mentzer
After seven years, one of the legislative efforts to reform school property taxes has taken a significant step forward, and the best part is it allows voters to decide. On July 11, the Senate voted 46-2 to approve House Bill 1285, legislation to amend the Pennsylvania Constitution to allow for 100 percent reduction of property taxes on a homestead or farmstead, i.e. principal places of residence.

Since this legislation sets up the opportunity to amend the state Constitution, it had to pass the House and Senate twice in two separate legislative sessions. This hurdle was cleared on July 11, when the state Senate voted 46-2 to pass House Bill 1285.

Now, the voters will get to decide on the Nov. 7 ballot whether to raise the current homestead/farmstead property tax exclusion in the state Constitution to 100 percent of assessed value. If voters approve the ballot measure, the Constitution will be amended as the governor’s signature is not required with a constitutional amendment.
If the voters approve amending the Constitution, the General Assembly will need to amend Act 1 accordingly.

Implementation of supporting legislation such as House Bill 76 or Senate Bill 76 would allow the removal of property tax on homestead/farmsteads and provide revenue from options like sales tax, Earned Income Tax or Personal Income Tax to make up the difference. The importance is that it allows for homeowners to be excluded from the burden of property taxes.

One challenge that we face in Harrisburg is how will we secure the more than $14 billion needed for total property tax elimination? Another issue is paying off the schools debt and how long homeowners would be paying property taxes after elimination to pay for that debt? Also, how do we keep from adversely affecting areas of the state that are not suffering from high property tax? Any legislation needs support from 102 House members, 26 senators and the governor.

We need options that will allow us to move forward with property tax elimination. Allowing for a homestead/farmstead exclusion changes the amount needed to almost half, roughly $7 billion, and would allow for property tax to be eliminated almost immediately. However, without the constitutional amendment any option calling for the removal of property tax from just a homestead/farmstead is not possible. This constitutional amendment gives us another option in the fight against property tax.