A Fairer Way to Raise Revenue

With all the threats facing us in the post 9/11 era, there is one that is very close to home and, in my opinion, threatens the very fabric of our community – ever escalating property taxes.

Middletown Township has been fortunate over the years. We have a large base of senior citizens living side-by-side with young families raising their children in what can only be called an idyllic community. And, we are doubly fortunate in that many of our graduates decide to return home after completing college.

Not surprisingly, then, the median age for males in Middletown Township is 37.8 and for females, 39. This is indicative of a very stable community with the human resources to thrive.

But we are at what I would consider a tipping point – witness the outrage this year over the possibility of a significant tax hike that will result from the cash-strapped Neshaminy School District’s budgetary needs. Seniors on fixed incomes are facing the possibility of having to sell their homes in order to survive and young people are finding it difficult to find an affordable home.

Using property taxes alone to support school districts and local and county governments is inherently unfair. It means the burden for these services falls on the homeowner alone.

The 2006 Taxpayer Relief Act restricted how much school boards can raise property taxes and also provided an average of $200 in reductions to property taxes. But we all know that more must be done.

According to Townships Today, a quarterly newsletter published by the Pennsylvania State Association of Township Supervisors, Gov. Ed Rendell and a group of local government associations are working on a tax reform plan that will allow counties to levy a 1 percent sales tax on the same goods and services subject to the state’s existing 6 percent sales tax.

Participating counties would receive 50 percent of the funds collected, townships and boroughs would be given 40 percent and 10 percent would be deposited in an account to support collaborative projects, such as regional police departments and joint equipment purchases, according to Townships Today.

Both county and local governments would have to use at least 60 percent of their allocated funds to reduce your property taxes and offset dollars they lose from exempt properties. This is a much more fair way of raising taxes since the burden is shared by everyone who buys taxable goods rather than just homeowners.

“The bottom line is that we, as a state, have to take a long, hard look at how we are funding government services,” Kenny Grimes, PSATS president, is quoted as saying. “The property tax isn’t working and it isn’t fair. Therefore we have to find a better way to balance the tax burden while still providing townships, counties and boroughs with adequate—and increased – funding that doesn’t come from a property tax hike. The optional county sales tax is our best option yet.”

I agree.