Some school districts would get more state funding, others less under a plan from the Democratic-controlled state House that was discussed recently by the House Republican Policy Committee.
One of the 126 districts likely to lose some or all state funding under the Democratic is the Souderton School District.
Rep. Donna Scheuren (R-Harleysville), representing the Souderton area, said the district was the first to adopt performance-based budgeting in Fiscal Year 2014. In the Democrats’ 87-page bill that was “pushed through in 24 hours” with no Republican input, “Souderton is being penalized for not taxing enough,” said Scheuren, who called the situation “outrageous.”
She said Gov. Josh Shapiro’s proposals, like a $60,000 minimum salary for teachers, take away local control. The district is 75 percent funded by local residents, 24 percent by the state, and 1 percent by the federal government. Many SASD residents are senior citizens who cannot afford additional property taxes to make up funding that state officials want to send to other districts, she said.
Shapiro is proposing $3 billion in new spending, while Republicans propose giving $3 billion back to taxpayers by reducing the personal income tax (PIT) from 3.07 percent to 2.8 percent and eliminating the gross receipts tax on electricity, the representatives noted.
Andrew Holman, a policy analyst with the Commonwealth Foundation, testified Pennsylvania is losing thousands of residents — many of them younger, working-aged adults — to states like Florida and Texas, where taxes are lower.
According to the Independent Fiscal Office (IFO), Pennsylvania’s working-age population will fall 2.6 percent between 2020 and 2025 and an additional 1.7 percent between 2025 and 2030, resulting in an adverse “dependency ratio” shift from 3.5 working adults per senior to 2.5 by 2030. This shift will have a drastic impact on state finances, he said.
State Reps. John Lawrence, Kristin Marcell, Donna Scheuren, Policy Committee Chair Josh Kail, Torren Ecker, Joe Hogan and David Rowe
Souderton Superintendent Frank Gallagher Ed.D. testified that a state committee report recommended $5.4 billion be used to fund public schools, and $291 million would be paid by 75 school districts, including Souderton.
“This is a penalty on school districts that worked hard to keep their taxes low,” he said. Souderton is “one of 14 districts that will not qualify for (state) adequacy funding. We will be expected to raise local taxes.”
Ironically, if the district had not been careful with its spending and raised taxes over the years to the Act 1 limit, they could continue to get state money.
“If the new formula passes, we would say we’re sorry,” said Gallagher. “We are being forced to raise our taxes. I am asking the General Assembly to provide an allocation for the 7 5 districts that kept taxes low during the Act 1 era.”
“Our taxpayers should not be penalized because we have worked hard to fund schools in a responsible way,” said Gallagher.
Scheuren said, “Instead of being rewarded, the governor has chosen to penalize you.”
Rep. Torren Ecker (R-Adams) asked Gallagher how he accounts for the success of his district’s students while other districts struggle.
“You’re doing a lot with a little,” he said.
Gallagher said one challenge the district has is “a significant increase” in students who don’t speak English. The biggest industry in the area is meatpacking, with “the largest meat packing plant east of the Mississippi,” and many of the workers are immigrants.
However, they have had success for students learning English with an immersive program. What helps students achieve is “the school and families working together,” he said.
Lower Salford Township Supervisor Chris Canavan, president of W.B. Homes, Wendell Weaver, vice president, Alderfer Glass, and Keith Freed, tax collector for Franconia Township, also testified about the “real world” effects of tax increases.
Weaver said businesses and families are feeling inflation. Healthcare expenses continue to rise, as does the cost of housing. There has also been a “major increase” in the price of electricity.
Canavan said there is a need for skilled labor, and he’s pleased that area school districts are seeing the importance of technical schools. But the area’s housing costs makes it difficult for people to afford homes. Many of his workers commute to the area, he said.
“They need homes, places to raise their children,” said Canavan. “As a township supervisor, I worry about the same thing. We have a wonderful group of volunteer firefighters, most in their 20s. They need homes,” he said. Otherwise, they’ll move to towns with more affordable housing, and Lower Salford will lose those much-needed volunteers.
“If there was ever a time in our lifetime when we needed less government, it is now,” said Kail. “We need lower and fewer taxes. Pennsylvanians deserve control over their own destiny, and both school choice and tax reform can accomplish this.”
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