Area School District
required each public school district to appoint a Tax Study Commission (TSC)
by no later than September 14, 2006. The Act states the Commission
shall be comprised of either 5, 7, or 9 members that is reflective of
the socioeconomic, age and occupational diversity of the district to the
extent possible. The board appointed the following individuals at its
September 12, 2006 meeting:
Masullo and Mr. Bean, the Superintendent and Director of Fiscal Affairs
respectively served as board liaisons with the TSC. Misty Rider an
employee of the district served as recording secretary. Mrs. Jill
Patterson was elected Chairwoman and Mr. Todd Clouser was elected Vice
Chairman of the Commission by their fellow members.
legislative purpose of this commission is to make a non-binding
recommendation to the school board to levy additional earned income tax
(EIT) or personal income tax (PIT). The revenue generated from the
increased tax rate will be used to reduce taxes on qualified residential
requires each TSC to consider the following:
and present rates of and revenue from taxes currently levied, assessed
percentage of total revenues provided by taxes currently levied,
assessed and collected.
· The age,
income, employment and property use characteristics of the existing tax
revenues of taxes currently levied, assessed and collected.
finding of facts:
Bellefonte Area School District Tax Study Commission comprising of seven
members find as follows:
that ACT 1
as enacted is a tax-shifting statute that requires this
Commission and also the Bellefonte Area School District to adopt a tax
increase by either establishing a PIT or raising the EIT. As such,
there will be relative levels of inequity that results as the Board
under this process must adopt a tax increase and possibly a severe one
at the detriment of one group and the benefit to another group.
neither the implementation of a PIT nor an increase in EIT will
establish a taxing rate on Social Security income or other pension
appears to be the most equitable form of taxation in that PIT spreads
the tax burden over a broader spectrum.
4. that high
millage rates most affect homeowners who have a fixed income such as
5. that high
EIT rates most affect the non-homeowners with low or modest incomes and
families of the highest income levels.
current conditions stand, collecting a PIT would be problematic.
Municipalities do not have legal authority to collect a PIT as well as
the fragmented collection process as it now exists would override any
positives from changing to the PIT. The Pennsylvania Department of
Revenue has not as of this date finalized the regulations for PIT
ACT 1 as
it is currently written does not provide any real meaningful tax relief
to homeowners as well as any additional funding of our school district.
It is simply a tax shift that in the long run will not provide any
sustained relief and in fact may lead to increased burdens in some
Non-Binding Recommendation to the
that this Commission must recommend an increase in either EIT or an
establishment of PIT;
the Personal Income Tax is not a viable option at the present time;
Commission recommends that the EIT be increased by
0.85% to a new rate of
1.90% for the school district and a
total rate of 2.40% including the local
municipalities (Bellefonte Borough would be 2.50%).
Commission further recommends that the School Board continue to
encourage local and state legislators to change the local tax collection
laws to allow the collection of a PIT by municipalities and the
collection of either a PIT or EIT at the state or county level.
Commission also recommends that the state legislators enact real and
meaningful tax reform to adequately fund our schools as well as provide
real and sustaining tax relief.
the above mentioned deficiencies in ACT 1 and the inadequacies of the
current tax collection process this Commission would strongly encourage
the citizens to reject the referendum question thus keeping the current
property and EIT rates unchanged.
finding of facts, non-binding recommendation and rationale were so
recommended by a vote of five (5) in favor and none (0) opposed with two