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It's time to educate voters on state tax trade-off plan

March 27, 2003

Legislators looking at the second half of Pennsylvania Gov. Ed Rendell's two-part budget plan know most voters want some changes in how the state's schools are funded. They're just not sure citizens will see the current proposal as a reform.

To their credit, they say they're going back to get input from their constituents. While they're doing that, it's essential that they educate voters on what the plan involves.

A little over three weeks ago, the governor offered a $21 billion plan to maintain key state services without a tax increase. Rendell wanted lawmakers to mull over that plan's cuts before taking action, but they promptly enacted it without waiting to hear his proposal for school-funding reform.

Rendell's plan would give the state's 501 school districts $1.5 billion to reduce property taxes by a maximum of 30 percent, but no less than 15 percent. That would increase the state's share of school costs from 35 percent to 50 percent.

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It's how that funding boost would be accomplished that's giving some members of the legislature heartburn. Rendell proposes to do it by increasing the state's income tax rate from 2.8 percent to 3.75 percent.

The governor said such a hike is needed because in the last 10 years local property taxes have gone up by 55 percent, straining the finances of homeowners on fixed incomes.

He notes that income-tax rate is below those in 38 other states including West Virginia. But even legislators who favor the idea are wary, because they know that some opponent in a future political race will trumpet the fact that they backed an income-tax hike, while not bothering to talk about property taxes being cut at the same time.

It is clear that what both the governor and legislators need to do is educate citizens on how this plan would work - and resist the urge to score political points during that process. It may be that voters would rather keep the income tax rate at its current level, but they need to know what the trade-off for doing so would be.

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