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FOR IMMEDIATE RELEASE |
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State
Rep. Bob Freeman |
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Freeman proposal would provide funding to municipalities
with high levels of tax-exempt property
HARRISBURG, Nov. 13 – At a Capitol news conference today, state Rep. Bob Freeman, D-Northampton, unveiled legislation he is introducing that would provide funding to municipalities with high levels of tax-exempt property.
“Throughout our Commonwealth, communities large and small, urban and rural, city, borough and township alike contain a considerable percentage of tax-exempt property within their borders,” Freeman said. “While these tax-exempt properties usually represent the presence of important governmental institutions, not-for-profit medical facilities, or institutions of higher learning that contribute to the quality of life of a community, they do not contribute to the tax base of the communities in which they are located as a result of their tax-exempt status.”
Freeman’s legislation would create the Tax-Exempt Property Municipal Assistance Fund, which would be funded by dedicating revenue generated by the 18 percent Johnstown Flood Tax to the new fund. Under the proposal, any Pennsylvania municipality where 17 percent or more of the total assessed value of properties within its borders is tax-exempt would qualify for compensation. The Johnstown Flood Tax, enacted by the state legislature in 1936 to provide financial relief to victims of flooding in Johnstown, is levied on the sale of wine and liquors and was intended to be temporary but now provides the state with approximately $240 million in annual revenue.
The legislation would require that each county annually provide the state with information regarding the assessed value of tax-exempt properties. The funding formula within the legislation is based on the assessed value of those properties if they were taxable. No single municipality would receive more than 10 percent of the total revenue in the fund, and property owned by the municipality itself would not be eligible.
“Without this infusion of much-needed funding, many of these communities face the very real prospect of failing as they fall deeper and deeper into financial distress,” Freeman said. “Without this compensating funding source, they will be forced to reduce essential services and continually increase their taxes as they attempt to deal with an ever-eroding tax base. With the revenue provided by my Tax-exempt Property Municipal Assistance Fund, we can stabilize hundreds of needy communities across Pennsylvania and ensure their success for years to come.”
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CONTACT: Ruth A. Myers |