A currently proposed state constitutional amendment – in the form of HB1285 – would enable Lower Mac to completely eliminate residential property taxes for qualifying homestead properties.
Note: This is not the same issue as SB76 – School property tax elimination. That’s the Bill to completely eliminate school property taxes by shifting funding to increased sales and income taxes. That’s a separate conversation with unique and different pro’s and con’s.
While SB76 addresses school taxes, it does not address any reform of local township taxes. To that end HB1285 would allow Lower Mac to expand our current reduction program and entirely eliminate municipal property taxes for residential homes in in the township. Therefore, in addition to SB76 I also support the constitutional amendment to expand the Homestead Exclusion.
If you recall, when I came into office one of the first major proposals I made was to institute the homestead exclusion. We did it to the max allowed over a two year phase in. The result was reducing and in some cases completely eliminating the township property tax for homeowners. 90% of residents over a two year timeframe got a reduction. HB1285 would allow the complete elimination. Something I would then immediately argue for should the amendment pass.
It is a long and tough process to amend the Pennsylvania Constitution. It takes a majority approval of two consecutive sessions of the General Assembly followed by an approval of the majority of voters. HB1285 has now been passed in two consecutive sessions, so I believe the next step is the voters. (I am confirming my understanding)
How would this work:
Currently, for some unknown reason the state Constitution only allows exclusion of 50% of the median assessed value of residential properties within the taxing district. Lower Mac has instituted that to the maximum currently allowed. While that has provided relief, it remains un-necessarily capped by the state. HB147 fixes that and amends the state Constitution to allow municipalities to entirely eliminate qualifying residential property taxes. Commercial and Industrial users including ultra impactful warehouses and also investment properties would still be subject to the townships very low property tax millage. (one of the lowest in the County)
This has been used successfully on the municipal end. With Lower Mac being a prime example. If this were to pass at the earliest possible point I would begin the budget conversations to eliminate residential property taxes entirely in Lower Macungie.
Here is a link to my original argument for initiating the homestead program originally. The program has been a success giving residents a needed break. While our taxes are already some of the lowest in the Lehigh Valley, we have to be aware of the cumulative impact including taxes from other governing bodies we can’t control. We must remember we don’t levy taxes in a vacuum.