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Pa. House Panel Moves Forward on Gov. Shapiro’s Plan to Update Property Tax Relief Program

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by Peter Hall, Pennsylvania Capital-Star
May 23, 2023

Pennsylvania’s Property Tax and Rent Rebate program provides financial breathing room for hundreds of thousands of older and disabled residents to pay their bills and stay in their homes, lawmakers and advocates told the House Finance Committee on Monday. 

But in the 16 years since the program’s enabling legislation, the Taxpayer Relief act, was last overhauled, Social Security and pension cost of living adjustments have put many who relied on the rebates over the program’s income limits.

“It is the most requested service we provide,” state Rep. Maureen Madden, D-Monroe, said in a hearing on Monday. “And we’ve been seeing over the years an upsurge in the number of claimants who are pushed out of the program because they’re slightly over the income threshold.”

The Finance Committee on Tuesday unanimously advanced House Bill 1100, sponsored  by Rep. Steve Samuelson, D-Northampton, which would increase the income limit and rebate amounts for qualifying homeowners and renters, to the House floor. 

It would also require annual adjustments to ensure the program keeps pace with Social Security cost of living increases.

The legislation reflects Democratic Gov. Josh Shapiro’s proposal as part of his budget to increase the maximum rebate for people 65 and older from $650 to $1,000 a year and the maximum income from $35,000 to $45,000 a year.

Rep. Keith Greiner, R-Lancaster, the ranking Republican on the Finance Committee, expressed reservations about automatically increasing the rebate amounts based on cost of living increases.

“Most of our legislation here in the commonwealth, we don’t deal with COLAs because we don’t know moving forward, what the cost of things are going to be,” Greiner said.

The state Department of Revenue provided an analysis of the legislation’s fiscal impact that showed it would result in $750 million in additional costs to the commonwealth in five years. 

Greiner proposed an amendment to eliminate the automatic adjustments, which was voted down 12-8 with Democrats unanimously opposed.

Despite GOP opposition to tying the rebates and income limit to the cost of living, Rep. Seth Grove, R-York, said in a budget negotiation update for reporters earlier this month that House Republicans believe Shapiro’s proposal could go further.

“We actually think there’s enough money at minimum to give everybody another $250 million. So the governor this year, the budget secretary, could have certified over a billion dollars in school property tax relief for homeowners,” Grove said.

In Monday’s hearing, Samuelson, the panel’s chairperson, , said the impact of the income limit remaining unchanged since 2007 is evident in declining participation in the rebate program.

When the limit was last adjusted in late 2006, about 605,000 Pennsylvania residents availed themselves of the tax relief. Since then, the number has dwindled to 433,000 and could drop below 400,000 if no action is taken, Samuelson said. 

Rep. Ismail Smith-Wade-El, D-Lancaster, told the committee on Monday about his meeting with Barbara, an 85-year-old constituent, who had come to rely on the rebate as a nest egg to buy Christmas presents for her grandchildren, whom she is helping to raise.

“We sat down to help her only to find that a slight increase in her pension because she is a renter has pushed her out of eligibility for the program,” Smith-Wade-El said. “It really feels like the very least that we could do to make life a little easier for Barbara and for her grandkids and for the people of … the entire Commonwealth of Pennsylvania.”

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