Area homeowners in line for property tax reductions, personal income tax hikes
By SHEILA BOUGHNER-BLAIR

4/4/03

Special thanks to The Derrick for allowing this story to be posted


THE CHANGES ARE PART OF GOV. RENDELL'S "PLAN FOR A NEW PENNSYLVANIA."

Area homeowners would receive property tax reductions ranging from 30 to 60 percent under Gov. Ed Rendell's proposed $1.5 billion property tax cut.

Their personal income tax, however, would increase by 34 percent.

The changes in tax rates are part of Rendell's "Plan for a New Pennsylvania," which would raise the state's share of basic education funding from 36 to 50.

The burden would be shifted from homeowners to the state with a $1.5 billion property tax rebate, which would be distributed to school districts according to the state's basic education funding formula. That formula is designed to neutralize inequities between districts and funnel additional funds to poor or rapidly growing school districts.

Each residential homeowner in a district would receive an equal share of the district's rebate, regardless of the value of their home.

Homeowners in the Franklin, Valley Grove, Allegheny-Clarion Valley, Clarion Area, Clarion-Limestone, Keystone and Redbank Valley districts would realize a 30 percent property tax reduction under the plan. The percent reduction for other districts includes Cranberry, 42.47; Oil City, 35.43; Titusville, 43.83; Forest Area, 33.13; North Clarion, 43.87; and Union, 60 percent.

Individual reductions for area districts range from $111.90 in Redbank Valley to $417.30 in Forest Area.

The increase in income tax, from 2.8 to 3.75 percent, would generate $2.2 billion for the plan.

Additional revenues would be generated by closing corporate tax loopholes, legalizing slot machines at some of the state's racetracks, increasing the tax on beer, creating a tax on cell phones and charging a fee to drivers convicted of moving violations.

In addition to funding the property tax rebate, the additional revenue would be used to fund a number of education initiatives such as all-day kindergarten, pay the interest on a $2 billion economic development bond, and add $700 million to the general fund.

The total amount of a district's rebate divided by the number of owner-occupied housing units in the district yields the proposed tax reduction per homeowner.

The governor's office has posted the proposed rebate for each of the state's 501 school districts on the state's Web site, at www.state.pa.us.

The number of owner-occupied housing units in each school district is available on the Internet at www.nces.ed.gov.

Here are the numbers for area school districts including total tax rebate, number of owner-occupied dwellings and tax reduction per homeowner:

VENANGO COUNTY

Cranberry

Total reduction - $1,067,360

Dwellings - 3,241

Individual reduction - $329.33

Franklin

Total reduction - $1,221,224

Dwellings - 4,805

Individual reduction - $254.16

Oil City

Total reduction - $1,302,937

Dwellings - 4,605

Individual reduction - $282.94

Titusville

Total reduction - $916,535

Dwellings - 4,162

Individual reduction - $220.22

Valley Grove

Total reduction - $437,082

Dwellings - 2,267

Individual reduction - $192.80

FOREST COUNTY

Forest Area

Total reduction - $790,792

Dwellings - 1,895

Individual reduction - $417.30

CLARION COUNTY

Allegheny-Clarion Valley

Total reduction - $383,529

Dwellings - 1,893

Individual reduction - $202.60

Clarion Area

Total reduction - $518,914

Dwellings - 2,008

Individual reduction - $258.42

Clarion-Limestone

Total reduction - $426,699

Dwellings - 2,177

Individual reduction - $196

Keystone

Total reduction - $334,255

Dwellings - 2,387

Individual reduction - $140.03

North Clarion

Total reduction - $331,446

Dwellings - 1,654

Individual reduction - $200.39

Redbank Valley

Total reduction - $298,220

Dwellings - 2,665

Individual reduction - $111.90

Union

Total reduction - $440,169

Dwellings - 1,351

Individual reduction - $325.81

The increase in income tax would amount to $190 for a wage earner making $20,000 a year, $285 for someone earning $30,000, and $475 for someone earning $50,000.