On June 27, Gov. Ed Rendell signed Special Session House Bill 39 into law, creating Act 1 and promising $1 billion in property tax cuts through reliance on gambling revenue and shifts to income taxes.
Act 1, for the first time in state history, caps the amount by which school districts can raise property taxes without court, state or voter approval. School districts annually will be given a percentage by which they can raise property taxes; Franklin County districts all fall between 4.1 percent and 4.4 percent for the 2007-08 school year.
Act 1 mandates that Pennsylvania's 501 public school districts maintain tax study commissions for 90 days at the end of this year. Those commissions are to review how taxes are assessed, levied and collected, then make recommendations on how it should be done in the future.
The law is designed with the assumption the commissions' recommendations will appear on ballots in May for voter approval, but the school boards do reserve the right to reject the recommendations.
Act 1 provides for five-, seven- or nine-member panels that reflect "the socioeconomic, age and occupational diversity of the school district."
Commission members may be residents or taxpayers. District employees and relatives are exempt from serving, although one school board member is permitted to sit on each panel.
School boards and administrative officials have lamented filling the diversity provisions for the commissions.
The Chambersburg Area School District extended its deadline for applicants after the initial call drew mostly retired senior citizens, Superintendent Joseph Padasak said earlier this month. Thirty-two district residents eventually submitted their names, some with a bit of encouragement.
"I'm (Chambersburg School Board member) Dave Sciamanna's next-door neighbor, and he asked me if I'd be interested in participating," said Greg Paulson, chairman of the Shippensburg (Pa.) University biology department. "It sounded challenging."
"I'm just one of those goofy parents who don't know when to say 'no,'" said Monica Kelso, a personal chef and caterer in Chambersburg. "I heard they extended the deadline ... I decided to throw my hat in the ring and see what happens."
The Waynesboro Area School Board recruited Eunice Statler, a retired employee of Landis Tool Co., when it didn't receive any letters of interest from women.
"I've lived here all my life, and I have been involved in some civic things. ... I think it should be an interesting process," Statler said. She would like to recommend taxation that is "more fair and equitable for everyone," she said.
Waynesboro officials also had little interest from the South Mountain, Pa., area, so they contacted the Rev. Lee Daywalt.
"If the community needs someone, I'm there to serve," Daywalt said.
Daywalt met Board President Larry Glenn while delivering an invocation for teachers at the start of the school year, and was asked to join the commission not long thereafter.
Daywalt said he especially is looking forward to the learning process.
Tony Pananes, part owner of Olympia Candy Kitchen in Chambersburg, said no one had to solicit him to be on the commission.
"I just moved back into the area last December and wanted to get involved in the community, and this was a good place to start," Pananes said Thursday at the Chambersburg commission's first meeting.
Know more in 30 seconds
The issue: Act 1 mandates that Pennsylvania school districts appoint local tax study commissions to recommend how school boards should shift taxes away from property taxes, either by increasing the earned income tax paid by wage earners, or creating a broader personal income tax, which also taxes some investment income.
What's new: The local tax study commissions have begun holding meetings to examine each district's tax structure to determine how much property taxes should be reduced and local income taxes increased.
What's next: The commissions have until Dec. 13 to make their recommendations to their respective school boards, which can accept the plans or craft their own property tax relief proposals for voters to consider in the May 2007 primary.