House Finance Committee Moves Historic Comprehensive Property Tax Reform Package
9/23/2013

HARRISBURG – Republican lawmakers see a future Pennsylvania free of property taxes. To date, no state has ever provided a mechanism for any local government to eliminate the taxation of property.  Today, the House Finance Committee took the first step by passing out of committee a package of four bills to give school districts the ability to eliminate their property taxes completely or for owner-occupied homesteads, announced Rep. Seth Grove (R-Dover).

“This package of bills provides the flexibility to school districts to deal with their property taxes, whether its complete elimination or reduction, homesteads or millage rates,” said Grove.  “House Bill 1189 or, the Optional Property Tax Elimination Act, is a critical piece of legislation that provides the ability for school districts to eliminate their property taxes through an elimination tax consisting of Earned Income Tax (EIT), Mercantile Tax, and/or Business Privilege Tax.”

The package of bills includes:

  • House Bill 1189 – Grove: Gives local school districts the ability to eliminate property taxes in favor of an array of taxing options that best suits the individual needs of residents and students of local school districts. It was amended in committee to ensure only 50 percent of the revenue raised from the elimination tax came from business taxes.
  • House Bill 125- Rep. David Maloney (R-Berks): Amends Pennsylvania’s Constitution giving local taxing authorities the power to exclude 100 percent of homesteads from property taxes.
  • House Bill 1677- Rep. Doyle Heffley (R-Carbon): Amends Pennsylvania’s Constitution eliminating homestead exclusion limits of one-half of the median assessed value of a homestead property.
  • House Bill 1685- Rep. Kerry Benninghoff (R-Centre/Mifflin): It allows school districts to increase the Earned Income Tax (EIT) rate for the purpose of providing homestead exclusions, instead of through voter referendum. It allows school districts to utilize their property tax reduction allocation for general government operation if they eliminate their property taxes.

Together, these four bills provide the flexibility, stable local funding, and options to gain consensus among both the House and Senate.

If a school district eliminates property taxes under House Bill 1189, they would still be able to keep property tax reduction allocations for general operating expenses under House Bill 1685. According to statistics provided to the Pennsylvania Department of Education by every school district in the Commonwealth, districts would see a funding increase of more than $525 million statewide, and more than $19 million for York County public schools.


School District                                 Total Property Tax Reduction Allocation

Central York SD

$1,066,569.85

Dallastown Area SD

$1,381,417.65

Dover Area SD

$1,275,694.04

Eastern York SD

$729,886.21

Hanover Public SD

$574,804.66

Northeastern York SD

$1,284,937.37

Northern York County SD

$723,060.01

Red Lion Area SD

$1,899,747.39

South Eastern SD

$992,636.16

South Western SD

$1,118,897.38

Southern York County SD

$1,065,927.76

Spring Grove Area SD

$1,000,106.55

West Shore SD

$1,284,935.79

West York Area SD

$1,060,752.21

York City SD

$2,902,021.73

York Suburban SD

$664,355.57

Grove adds, “For longer than I have been alive, we have been debating property tax reform and in particular, school property tax elimination.  We have finally provided an achievable and effective route to end this debate once and for all.  Something every other state in our country has failed to do.”

The package of bills will now go before the full House for further consideration.

For more legislative information, visit Grove’s website at RepGrove.com or follow his legislative Facebook page at Facebook.com/RepSethGrove. 

Representative Seth Grove
196th  District
Pennsylvania House of Representatives
Media Contact:  Mike Straub
717.260.6479
mstraub@pahousegop.com
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