PA Governor Rendell Calls for an End to Impasse in Property Tax Relief Debate

PHILADELPHIA, April 7 /PRNewswire/ -- Pennsylvania Governor Edward G. Rendell today said the legislative panel that's working to develop a compromise property tax bill should end its impasse and come up with a plan that will give homeowners, especially senior citizens, relief from dramatically-rising levies.

The Governor took his message to Nazareth Hospital, which is the largest employer in House Speaker John Perzel's legislative district. Governor Rendell said the Speaker should show the same leadership that lawmakers from the conference committee's other three caucuses (House Democrats and Senate Republicans and Democrats) have shown to move ahead with school property tax relief.

"Since I called a Special Session on property taxes, the citizens of Pennsylvania have endured eight months of debate and, in some cases, blatant stalling, and still they are waiting for a bill that would guarantee the wage tax relief to Philadelphians and property tax relief for our seniors and suburban residents that they were promised," said Governor Rendell.

"Now more than ever, it is crystal clear to me that what we need at the negotiating table is leadership from all four caucuses. Speaker Perzel must press his conferees for action. The time for Speaker Perzel to join leaders already working to forge a compromise is now.

"Leaders of three caucuses are working in earnest to craft out a final bill, but under the chairmanship of a House member, the conference committee has made little progress. Speaker Perzel's lack of involvement is unacceptable, and I believe if he joined Democratic and Republican leaders already working to hammer out an agreement, the people of Pennsylvania will see that we in Harrisburg can deliver on our promises to them."

If a final bill is enacted, and once gaming venues are operating, Philadelphians will see an immediate reduction in their wage tax rate to 3.78 percent, a 15-percent reduction. For an average Nazareth employee, that would mean a savings of about $281. Suburban residents will also a see a reduction in their wage tax rate from 3.77 percent to 3.56 percent, in addition to property tax relief.

In the past month, the Governor has taken his call for immediate property tax relief directly to Pennsylvania homeowners, as he has urged action by state lawmakers. In meeting with homeowners and seniors, he has said tax relief legislation would dramatically reduce, or eliminate, their property tax burden.

With the legislation, more than 400,000 seniors on limited incomes will get extra relief immediately and, once combined with gaming funds, 40 percent will have their school property taxes fully reimbursed. In Philadelphia, as many as 66,156 more senior citizens will get reimbursement for part of their entire property tax bill.

"We have the opportunity to make life easier for senior citizens who find it so hard to get by on limited incomes," said Governor Rendell. "Thousands of seniors who live and own homes will finally get more property tax relief. If we act now, we can completely eliminate school property taxes for nearly one out of every three Pennsylvania senior citizens who earn less than $30,000 a year."

Legislation passed by the Senate earlier in February would ensure that homeowners in every school district can receive their share of the $1 billion in funding for tax relief from gaming. The bill also raises the income cap for Pennsylvania's successful Property Tax/Rent Rebate Program from $15,000 to $25,000 -- effective this year. Some members of the House have proposed raising the cap even higher.

Based on a new income cap of $30,000 a year, as the Governor is proposing, and after the $1 billion from gaming is added, school property taxes can be completely eliminated for a third of senior citizens statewide who earn up to that annual income amount, the Governor reminded.

The total number of senior citizens receiving property tax rebates under the state's Property Tax/Rent Rebate Program would increase from 178,000 to nearly 600,000, and approximately 200,000 of these senior citizen homeowners would pay no school property taxes at all once gaming revenue is realized.

The Governor has pledged his cooperation to a special Conference Committee of House and Senate leaders charged with writing a property tax relief package. And, he has suggested the panel consider legislation that:

-- Enables school districts to impose or shift to a Personal Income Tax;
-- Increases the income threshold for seniors and others eligible for the
Property Tax/Rent Rebate Program to $30,000;
-- Ensures the appropriate application of the back-end referenda for
school districts that cross county lines;
-- Establishes the date that the act becomes law as the date certain for
school districts not currently participating in Act 72 to have issued
debt that is permissible without referenda consideration; and
-- Increases the flexibility offered to school districts to permit taxes
to be paid in installments rather than lump sums.

Since taking office in 2003, Governor Rendell has consistently called on the General Assembly to deliver on the promise of property tax relief. He signed Act 72 into law in July 2004. This act reduced property taxes by $1 billion statewide using revenue generated from gaming. After many school boards refused to deliver this property tax relief to their constituents, Governor Rendell called the Legislature into Special Session last September to enact a permanent solution to school property taxes.

The Rendell Administration is committed to creating a first-rate public education system, protecting our most vulnerable citizens and continuing economic investment to support our communities and businesses. To find out more about Governor Rendell's initiatives and to sign up for his weekly newsletter, visit his Web site at: http://www.governor.state.pa.us/.