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Pennsy school budget law: Drop referendum proposal

March 12, 2004

A proposal to allow Pennsylvania residents to vote on their local school board's budget as the price of getting property-tax reform is wrong-headed and should be defeated.

School boards are elected to dig into a budget's details, and if voters don't like the action they take, they can vote them out.

Not every budget would require voters' approval, but only those that exceed an index based on the average increase in something called the "Statewide Average Weekly Wage and Employment Cost Index."

The Pennsylvania School Boards Association Web site indicates that in the past six years, the index has increased 2.6 percent to 4.2 percent a year.

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If the index went up by 2.6 percent, a school district couldn't increase property taxes by more than that amount without going to referendum.

To hold an election in time to pass the budget by the start of the fiscal year on July 1, Chambersburg school officials said they'd need to have a budget ready for public inspection by January.

They called that idea "impossible" and "undoable," but if it were the law, they'd find a way to do it. But the long lead time required would mean that budgets would be based on long-term projections rather than current information.

If, for example, health care costs go up after the budget is written, the school board would have to choose between reducing employees' benefits and laying off workers.

The basic bill this proposal is attached to is a good one that would reduce school districts' dependence on property taxes and replace those revenues with more income-tax cash.

The idea behind the referendum requirement is to prevent school district officials from trying to have it both ways by taking the increased income-tax funds while raising property tax at the same time.

Instead of further burdening voters who've already elected representatives to read and vote on a budget, why not build the idea of an index into the state formula? In that way, a local district could raise property taxes, but would have to convince officials in Harrisburg that their increase shouldn't trigger a cut in state aid.

As an added bonus, it would save local districts the cost of running a referendum that would turn on small expenditures that have little to do with the overall budget.

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