![]() ![]() As property owners, it’s important to stay aware of what’s being proposed in case it stands to impact the tax rate on your residential or commercial property. School districts across the Commonwealth are having their budgetary discussions now. To go above the index requires state or voter approval. It takes into account the average statewide weekly wage, which is likely to be lower in wake of this pandemic. ![]() It’s important to note that in Pennsylvania that the Act 1 index caps how much school property tax rates can rise. This tax increase, compounded by any other financial hardships property owners have faced this year is a significant stressor. For a property appraised at $250,000, that would mean an increase of about $666.25 per year. Pennsylvania is not unique in this dilemma, just last month Nashville approved a 34% property tax increase to account for revenue loss as a result of COVID-19. While some school districts in the capital region are not considering a property tax increase, and instead choosing to cut programs, contract out services to reduce spending, or drawing upon reserves, many others say a tax increase is unavoidable. Raising property taxes is never a desired solution, but it’s among the most obvious and effective. So how will they make up for the gap? Naturally, the focus shifts to property taxes. Even if the economy recovers quickly, and there’s no predicting if it will, that still leaves schools with a predicted loss of $850 in revenue. School districts in Pennsylvania are working to set their budgets for the 2020-2021 school year, and are potentially facing a $1 billion loss in local revenue as a result of coronavirus, according to the Pennsylvania Association of School Board Officials (PASBO) study. ![]()
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