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Boards consider challenging property-tax law



Published: Sat, February 5, 2005 @ 12:00 a.m.



School boards have until May 30 to decide whether to take a share of the revenue from slot machines.

HARRISBURG (AP) -- The Pennsylvania School Boards Association is considering either a court challenge or a campaign to change a new law that requires school districts to limit future tax increases if they accept gambling revenue to cut property taxes.

The new law, known as Act 72, sets a May 30 deadline for school boards to decide whether to take a share of the revenue from slot machines. Gov. Ed Rendell's administration projects slots will generate up to $1 billion a year for tax relief, or an average property tax reduction of about $330 per household.

If the answer is yes, future tax increases will have to be capped at the rate of inflation, unless voters approve a referendum allowing the board to exceed that cap.

But since Rendell said in December that delayed passage of the gambling law means homeowners won't see any tax cuts until at least 2007, school boards should have "a couple more years" to decide whether to participate, PSBA Executive Director Thomas Gentzel said Friday.

"Increasingly, the question that is coming up is, 'Why are we being forced to do this now?'" Gentzel said.

Exploring a suit

At a Jan. 21 meeting, the association's executive board authorized PSBA lawyers to explore filing a lawsuit after discussing whether the association should join a lawsuit already before the state Supreme Court challenging the constitutionality of the gambling law.

The board decided not to get involved in the gambling lawsuit because the association has been neutral about the legalization of slot machines, Gentzel said. PSBA is expected to decide within two months whether it will challenge Act 72.

As for changing the law, Gentzel said association officials hope to meet formally with legislative leaders "soon" to discuss possible amendments.

Steve Miskin, spokesman for House Majority Leader Sam Smith, R-Jefferson, said any lawsuit against Act 72 or delay of its implementation would be "a strike at the taxpayers."

"If they take it to court, that would be a shame," Miskin said.

Homeowners who want to reap the benefits of slot machines must apply for a "homestead exclusion" through their county tax assessor's office by March 1. Any revenue available for tax cuts would be passed on through lower tax bills, rather than rebate checks.

Rendell's office has said that as of Tuesday, nearly 60 percent of all households, or 2.2 million, had applied for tax relief.

"We think that shows people want their school boards to opt into the program," Rendell's spokeswoman Kate Philips said.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.




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