On Aug. 30, 2021, the Pennsylvania House of Representatives Republican Policy Committee conceded to my request to hold a public hearing on the property tax elimination efforts that have been going on for decades for others and for over four years for me personally.
The hearing was held at the Lebanon Expo Center. It was my understanding that this was the first policy hearing in Lebanon County for quite some time. The topic was so enthusiastically received that it was attended by the largest delegation of House members of any policy committee in recent history.
In all the work that we had done over the years, I had decided in my second term to take a different approach to the property tax problem and meet with the opponents of property tax elimination rather than just supporters to see if a solution could be crafted.
With those meetings we crafted House Bill 13
as a draft only in August 2019 to get rid of school property taxes entirely. The bill included a myriad of tax changes, but the most controversial part of the bill called for a tax on non-Social Security retirement income. Seniors would, however, have saved over $2 billion annually in school property taxes under my bill. For example, most seniors at Londonderry Village, Traditions of Hershey, and our other county retirement communities would have benefitted significantly.
Because of the difficulty encountered in the Legislature and executive branches by a prior property tax work group attempting achieve consensus on the issue and with the controversy over my bill, I decided to table House Bill 13 in late 2019.
Then in 2021, the House Republican Policy chairman asked me if I would like to take one final try at elimination. I jumped at the opportunity, but I cautioned everyone that time was no longer on our side.
In putting the agenda together, I thought it useful to call on supporters, naysayers and analysts for input. I was willing to risk that no decision would be possible as a result of the hearing.
We invited the following to testify in addition to myself:
Matt Knittel, director, Pennsylvania Independent Fiscal Office (IFO).
John Callahan, chief advocacy officer, Pennsylvania School Boards Association
Dr. Andrew Armagost, director of advocacy and analytics, Pennsylvania Association of School Business Officials
William Johnston-Walsh, director, Pennsylvania AARP
Ron Boltz, president, Pennsylvania Liberty Alliance
Jim Rodkey, founder, Pennsylvania Property Rights Association
The testimony was extremely well received. It was interesting to note that Pennsylvania’s IFO indicated that House Bill 13 would have raised sufficient revenue to eliminate property taxes and would have significantly reduced the tax burden on the majority of senior citizens.
After the conflicting perspectives were presented at the hearing, I was extraordinarily pleased that many groups that had opposed property tax elimination previously were now willing to discuss possible solutions.
I remain very skeptical because what I have found over the years is that most Pennsylvanians want to eliminate property taxes if it means they save significantly and someone else pays for it.
I believe that eliminating the school property tax is critical to the economic survival of the Commonwealth and its citizens!
In my 40-plus years as a certified public accountant and expert in helping organizations avoid bankruptcy, I can think of no more complicated problem to the financial survival of the Commonwealth than eliminating all property taxes.
The reason this is so complicated is because our current system of taxation and funding schools is so fundamentally flawed that even minor fixes to peripheral elements of the system may have significant unintended consequences. For instance, with the funding formula, some school districts such as Palmyra receive significantly less of their budget from the state than does Philadelphia school district. The differences in percentage funded is made up by property owners. With the hearings, however, new life has been breathed into the elimination proposals despite significant obstacles.
I cannot emphasize enough how severe the problem is with school property taxes. It is critical that everyone understand that if we do not resolve this problem the probability of surviving the next economic downturn is limited.
If we take decisive action now to reform our tax policies for working families, seniors, businesses and school districts, with the fundamental shift in the elimination of school property taxes we can reverse these negative trends.
The working group met again the weekend of October 16 to discuss the way ahead. A possible solution is on the horizon, and we will keep you posted.
Frank Ryan, CPA, Col USMCR (Ret) represents the 101st District in the PA House of Representatives. He is a retired Marine Reserve Colonel, a CPA and specializes in corporate restructuring. He serves as vice chairman of the PSERS Pension Board and is chairman of its Audit/Compliance Committee. He can be reached at firstname.lastname@example.org.
Representative Frank Ryan
101st Legislative District
Pennsylvania House of Representatives
Media Contact: Donna Pinkham
RepFrankRyan.com / Facebook.com/RepFrankRyan