PENNSYLVANIA Residents to get some say-so on property taxes

Exemptions include giving school employees raises.
HARRISBURG (AP) -- A new law that finances up to $1 billion a year in residential property-tax reductions with gambling revenue is also giving Pennsylvania taxpayers an unprecedented say over how high their taxes can be raised in the future.
The law, signed Monday by Gov. Ed Rendell along with companion legislation to allow slot-machine gambling, requires school boards to seek voter approval for property-tax increases that exceed the rate of inflation.
The voter referendum provision was sought by Rendell and Republicans who control the Legislature to ensure that the property-tax cuts, which likely won't take effect until 2006, aren't eaten up by large tax increases in the future.
"It's important to protect taxpayers from arbitrary increases immediately following the [property-tax] decrease," said Kate Philips, Rendell's spokeswoman.
Close to half of the 50 states already require voter approval for certain types of school funding increases, according to the National Conference of State Legislatures.
The rules
Pennsylvania school districts would be subject to the referendum requirement only if they decide to accept the gambling revenue in the first place. To qualify, school boards must vote to increase the local earned-income tax rate by 0.1 percent.
According to an estimated timeline on the implementation of the law developed by Senate Republicans, districts would have to adopt preliminary budgets in February and decide in March of each year, beginning in 2006, whether they would need a referendum.
Referendum questions would be placed on the ballot for the spring primary election. If voters reject the tax increase, the school board would have to keep the rate increase within the rate of inflation.
Several exceptions
The new state law, however, permits several exceptions in an effort to address concerns by school boards and administrators that many factors that drive budget increases are beyond their control, such as teachers' contracts and government mandates to provide certain programs.
Matthew Brouillette, president of The Commonwealth Foundation, a conservative think tank in Harrisburg that favors the so-called back-end referendum, said he believes the exceptions are too generous.
"I think it creates too much leeway for school districts, and they'll be creative in providing loopholes to raise taxes without voter approval, but it's certainly better than what we've had in the past," Brouillette said.
Likes the idea
Scott Walter, an elementary-school teacher who lives in the Coatesville Area School District, said he is eager to have a say over his school taxes. Walter, who pays $4,200 a year in property taxes, is the president of a citizens group that recently formed in response to concerns about the district's tax rate, which is the highest in Chester County.
"There has to be some basic measure of control. Taxes cannot continue to skyrocket year after year," he said.