Homeowners in school districts throughout Pennsylvania found out last week estimates of how much their property tax bills will be lowered next year courtesy of the more than $612 million in state gaming revenues, state Senator Jay Costa (D-Allegheny) said.
The state Department of Education released their calculation of the estimated property tax cuts in each school district.
“The tax relief act is designed as pure relief, with no tax shifting,” Mr. Costa said. “By using gaming revenues, homeowners across the state will see their tax bills cut by an estimated 10 percent even without the large and expansive casinos in Pittsburgh, Philadelphia and other areas open and operational.
“That bodes well for deeper and continued tax cuts well into the future.”
Under the Taxpayer Relief Act of 2006 (Special Session Act 1 of 2006) gaming funds are distributed annually to school districts to provide local tax relief. This year's distribution marks the first-ever provided under this law.
In the 43rd Senatorial District school districts, homeowners will see their tax bills cut by the following estimated amounts:
-Penn Hills $189
-Steel Valley $235
-West Mifflin $219
-Woodland Hills $184
Mr. Costa said a great benefit is that this cut will occur without a tax shift — no other taxes will have to be increased.
“The tax relief act features tax cuts that will grow as more casinos come on-line,” Sen. Costa said. “This is the first installment of an effort to trim homeowner tax bills and deliver relief without imposing new and different taxes.”
The Forest Hills lawmaker said that Act 1 also included spending controls that will help reign-in costs and hopefully stanch large local tax increases.
“The goal of Act 1 is to address several aspects of the property tax problem,” Mr. Costa said. “The significant expansion of the Property Tax and Rent Rebate program-which was another important aspect of Act 1-coupled with the reduction of homeowner tax bills means that total state property tax relief will be $786 million.”
The distribution of funds for general property tax relief triggers another important part of Act 1-supplement property tax relief for eligible seniors.
Eligible seniors living in Pittsburgh with incomes under $30,000 will see their property tax rebate increased by an additional 50 percent. Plus, property tax rebates are increased by an additional 50 percent for senior households in the rest of state, so long as those households have incomes under $30,000 and pay more than 15 percent of income in property taxes.
The kicker was inserted into the tax relief legislation because seniors living in Philadelphia, Pittsburgh or Scranton, where local wage/income tax rates are very high, will not benefit from tax shifts approved by voters that are designed to lower taxes on top of the reduction offered by the state funded property tax relief.