Real estate tax elimination perspectives

Just as the Boston Tea Party took place due to taxation without representation Pennsylvania’s politicians are guilty of not complying with its citizens overwhelming wishes to eliminate real estate taxes that are used for education. Major cities such as Philadelphia, Pittsburgh and Erie unjustly receive taxes collected from communities outside of their domain to support their school systems. These large urban schools produce many more criminals, single mothers and future welfare recipients than honor roll students. Pennsylvania school officials agree that large city schools are far beyond redemption.

Today’s politicians would not be faced with a charge of treason for attempting to simply abolish private residence real estate taxes. And yet, the majority of elected officials are timorous when it comes to dealing with Pennsylvania’s real estate tax system. Their main fears include not being voted for by those who work in the realm of the educational field. There is no doubt that staffing and school budgeting systems are in need of sweeping revisions. A proposal to do away with real estate taxes on all noncommercial homes valued under any arbitrary figure should be put on next year’s ballot.

Now is a good time to do away with school taxes. Parents have wanted the option of receiving vouchers to send their children to private, safer and better schools rather than public schools for a long time. Real estate tax savings would allow them to put that money toward a better education. Doing away with these taxes would also improve public schools. Class sizes would become smaller and public schools could then justifiably cull any malingering sub par teachers. New taxes to take the place of real estate taxes would be less burdensome due to the downsizing of the public school systems that would take place.

The majority of politico types interviewed for this article had solution suggestions for funding Pennsylvania’s school systems. Some had nothing to say and said it endlessly. None of their solutions included what voters want, the end of real estate taxes. Politicians have statistics available that shows what the 501 school districts and 67 counties each received for educational expenses. Revenues for education come from not only real estate taxes. Other school tax sources include sales tax revenues, school district income tax levies and the new casino revenues that are supposed to lower the cost of real estate taxes are but a few.

The number of school districts in Pennsylvania is ridiculously high. Any consolidation of school districts to any degree would save millions of dollars in expenses. Pennsylvania has historically been dedicated to making sure its citizens receive a quality education but many believe this responsibility should be done more frugally. Much has been said about the state legislatures who recently voted themselves a raise in an underhanded manner. Teachers aren’t in a position to vote them selves a raise so they sometimes use other methods that are considered just as unscrupulous by many.

One method is to ensure that retired teachers are members of school boards. Many times these school board members have spouses or relatives who are teachers in the school districts of which they are school board members. Chances are they are likely to push for pay increases and benefits under these circumstances. Most teachers deserve better pay but many others would likely be denied any salary increase outside the realm of the teaching profession. They might be referred to as “ Peter Principal “ teachers, meaning those who have reached a level of incompetence at their current position and who are never demoted or promoted.

Educational expenses like all other forms of governmental expenses always include a degree of wasteful spending. Taxpayers have learned to live with the untold number of taxes they are forced to pay but feel that real estate tax is one tax that should be eliminated. They have communicated their distaste for this tax for numerous years. No steps however have been taken to do away with the tax. Some politicians were recently voted out of office after their secretive pay raise scandal. Politicians who are afraid to carry the ball to do away with real estate taxes should also be replaced.

Some might ask how the lost revenue from real estate taxes would be made up. Some have suggested that the 18 percent “ Johnstown Flood Tax “ that is levied on all liquor sales in Pennsylvania be diverted to educational needs. The tax was originally levied to pay for the rebuilding of Johnstown, PA after their great flood catastrophe that occurred in 1889. Johnstown has been rebuilt for many decades. This tax is still being collected however and the money now goes to mass transit and who knows what else. Once any tax has been established it is difficult to have the tax dislodged without a struggle. Such is the case with real estate tax.

One elderly individual stated that he applied for the new Pennsylvania Tax Rebate program that took effect in 2006 and received a $250 real estate tax rebate. He stated, “ That’s not much of a rebate considering that I paid over $3600 in real estate taxes last year.” Like many persons on a fixed income he became emotional and stated he and his wife are going to have to sell their home and move in with one of their children. They simply can’t afford the real estate taxes. “ Even though our house is finally paid off we feel like we’re living in a rental property. We’re basically paying $300 a month to live in our own home.”

Anyone who has purchased a home in the last three or four years probably paid too much. Thousands of homeowners in Pennsylvania are now losing their homes due to high interest rates. Creative adjustable rates allowed homeowners to qualify for loans they really could not afford when their interest rates became higher. Lending institutions are now receiving billions of government dollars to help bail them out of the bad loans they made. The federal government however, is not bailing out homeowners who are losing their homes. The elimination of real estate taxes would allow many homeowners to afford their mortgage payments.

PHEAA recently gave out a half-million in bonuses to its executives. The bonuses prompted Governor Rendell’s spokesman Chuck Arno to say, “ This is disturbing to say the least. This is another example of the education agency’s failure to understand that its mission is to help students and not to provide further compensation for well paid executives.” PHEAA’s top executive Richard Willey will receive $180,857 in addition to his annual $289,118 salary. Vice president and financial officer Tim Guenther and other PHEAA executives Brian Lecher, Jim Preston will receive $113,514 while Kelly Logan will only receive a paltry $52,436 bonus.

These bonuses are being awarded only months after lawmakers chastised the PHEAA agency over its travel spending. PHEAA was forced to reveal its travel spending records only after it lost its legal battle with the Associated Press, the Harrisburg Patriot News and Pittsburgh’s WTAE television station. It seems that money intended for educational services are often wasted or diverted to unwarranted uses. Evidence as to who approved the aforementioned bonuses will hopefully be revealed. If justice prevails the bonuses will be denied. In addition to being replaced the executives should be prosecuted if any illegal activity is discovered.

The wasteful spending of tax revenues by any governmental agency is a reality. The wasteful spending of real estate tax revenues is especially disturbing. If the old adage that a man’s house is his castle, it seems it should receive more tax breaks than say Exxon, Haliburton, General Motors ___________ but that’s not the case. Politicians no longer for the most part give a damn about what their constituents want. Some are only interested in helping those who can help them. Politicians need votes to get elected. They’re not particular if the votes come from you or a teacher’s union. Therein lies the key to eliminating realty taxes.

The elimination of real estate taxes would be an incentive to purchase a home and private property values would undoubtedly rise. Housing jobs would increase in Pennsylvania and other businesses such as building suppliers; banks, realtors and many other industries would benefit as well. Imagine being able to afford such items as health insurance. Some would even be able to pay for their prescriptions and still have some money for food. Don’t doubt that real estate taxes can become a thing of the past. All it will take is dedicated groups of individuals and concerned citizens to get it done.

William Bigle
Red Lion