Property Tax Relief for Seniors

Moyer Property Tax Initiative


This document addresses a serious problem in the Commonwealth of Pennsylvania regarding property taxes on individuals living on fixed income.  Drafted and presented by the Pennsylvania Taxpayers Action Group (PaTAG), c/o Mr. Clair Moyer, 115 Armory Blvd., Lewisburg, Pa. 17837, email patag2014@gmail.com, phone number 570-412-5559.


CURRENT SITUATION:


In Pennsylvania, the homeowner is responsible to pay property taxes to support local school districts and local community general funds. 
The ad valorem property tax is probably the most widely discussed, yet the most misunderstood part of the public finance process. Knowledge of the manner in which the tax is determined is vital.  Once understood the numbers are straight-forward and simple math. You may also discover that many of the elected officials–city council members, county commissioners and the school board– are taking more money than they should or they’re spending the government into a deficit each year. 


THE PROBLEM:


For home owners over the age of 65, or those on a fixed income, any fluctuation in the rate of tax can be devastating and these fluctuations can come without notice. When these individuals fail to pay their property taxes their homes can be and usually are confiscated and sold at a sheriff’s sale. One could argue that this is a violation of the 4th Amendment to the United States Constitution in that we are to be protected from illegal search and seizure. True data of real property sales is difficult to find because it is convoluted with other forms of taxation, but just one sheriff sale for nonpayment of property tax is one too many.  There are all kinds of web sites advocating how to purchases properties and benefit from the built up equity in homes being sheriff sold for nonpayment of property taxes.  Chapter 29 Title 53 Municipalities General directs the authoritative power of local governments.  The Taxpayer Relief Act, also known as Act 1, passed by the General Assembly in 2006 was to prevent school districts from raising taxes without a referendum but a loophole in the law enables the districts to circumvent the intent of the law and do so on a regular basis.

THE PROPOSAL:


PaTAG proposes a property tax reform to eliminate property taxes for all individuals sixty five (65) years of age and older who own property.  If the property is owned jointly, through marriage, by husband and wife or same sex, then only one of the two individuals needs to have obtained the age sixty five (65).  The 2013 census for Pennsylvania reported a total population of 12,773,801 of which 70.1% are homeowners reported during the period 2008-2012 with 16% of the population over the age of 65. (http://quickfacts.census.gov/qfd/states/42000.html).  The older population--persons 65 years or older--numbered 40.4 million in 2010 (the most recent year for which data are available). They represented 13.1% of the U.S. population, over one in every eight Americans. The number of older Americans increased by 5.4 million or 15.3% since 2000, compared to an increase of 8.7% for the under-65 population. However, the number of Americans aged 45-64 – who will reach 65 over the next two decades – increased by 31% during this period.

ALTERNATIVE SOURCE OF FUNDS:

Pennsylvania does not currently tax the fracking industry. Based on relevant data from Alaska, we believe this burden can be alleviated and those most vulnerable members of our society can be protected from the damaging decisions made by lawmakers by the appropriate taxation of those who are taking the natural resources that belong to the residents of Pennsylvania.  Basic income is a regular unconditional cash grant paid to all citizens without any means test or work requirement. It’s often dismissed as a utopian idea.  However, a basic income, or something very close to it, exists today in Alaska. It’s called the Permanent Fund Dividend (PFD) or sometimes “the Alaska Dividend.” It has helped Alaska maintain one of the lowest poverty rates in the United States. It has helped Alaska become one of the most economically equal of all 50 states. And during the 1990s and 2000s it helped Alaska become the only US state in which equality rose rather than fall. Alaska is doing something right, and the dividend is a part of it.  Excerpts from an article on the Alaskan model taken from http://www.opendemocracy.net/ourkingdom/karl-widerquist/alaska-model-citizens-income-in-practice.  Visit the web site to read the full article.

Pennsylvania is rich in natural gas deposits.  These deposits are being extracted through a method called Fracking.  These deposits belong to the people of Pennsylvania not just a selected few individuals.  PaTAG recommends a tax assessment against the Fracking Industry which will be more than sufficient to replace any lost revenues caused by this property tax reform or any future property tax reform.

In addition to taxing the natural gas industry, a change in the sales tax rate would further replace any lost funds that will occur through property tax reform.  Based on data obtained from STC003: State Government Tax Collections 2013 the sales tax would have to increase from 6% to 6.0129% to fully replace revenues collected from property taxes.  To view this sales tax analysis visit http://www.patag.org.  Click on the link labeled property tax and then click on the link labeled tax analysis.

Property tax reform is needed to help these individuals over the age of 65 who own property and are being so heavily taxed that they are being forced to either sale their homes and move to a different area or revert to renting.  Many of these individuals worked all their lives and paid off their home loans.  They now have equity in their homes which they will lose should they fail to pay their property taxes.  And probably even more important than all of this, is that this is their home – their safe haven.

NEEDED ACTION:

The people are asking their elected officials to support this Property Tax Reform and to proceed with the political process to make this become law.  Take action now before it is too late for some.