More on Act 1

The Mt. Lebanon PTA has produced the following statement on Act 1:

ACT 1

On May 15th, the referendum question below will be placed on the ballot:

"Do you favor your school district imposing an additional .9% earned income tax? The revenue generated from the tax increase will be used to reduce taxes to qualified owner occupied residential properties by approximately $640 the first year and increasing to approximately $914 in succeeding years. The current school district earned income and net profits tax rate is .5% and the current combined municipal/school district rate is 1.3%."

According to the Mt. Lebanon School District Local Tax Study Commission, "members were generally surprised and disappointed that they lacked the ability or opportunity to make significant proposals to improve our current system of local taxation, and were uncomfortable with the thought that their recommendation, if accepted by the Board and approved by the electorate, would do nothing more than shift tax burden from one member of the population to another, without any clear relationship to issues of fairness and equity."

Mt. Lebanon School Board unanimously passed a resolution on Act 1 at the April 16th board meeting. The resolution states: "Members of the School Board of the Mt. Lebanon School District hereby express their opposition to Act 1 as it fails to enact any meaningful or genuine tax relief, but rather only provides for a tax 'shift.'" (Go to www.mtlsd.org and read the resolution.)

What does this mean for our community? Everyone in the community will pay tax of .9% on earnings.

• Residents with no earned income tax will not see their taxes go up, and will see a first year savings on real estate taxes of $640 (estimate only).



• Renters (25% of our population) receive no relief at all, nor do properties owned by businesses.



• Renters could opt to live elsewhere, and then purchase in those communities instead. Many of our home owners in this community began as renters.



• We have many seniors who rent. They will not see any relief with this tax shift.

If surrounding communities do not pass Act 1, this could greatly affect the property values of Mt. Lebanon homes, as well as affecting our ability to attract new residents. We could see families and dual-income residents exiting this community for surrounding areas without this tax on earned income.

Increased earnings do not offset the immediate loss of $400,000 in investment earnings from the change in timing of the tax receipts. We pay property taxes once a year; EIT is collected over the year, in 4 different installments. When the property taxes are collected, the money is invested so that it works for the District.

If Act 1 passes, the School Board must consider the need for .13 of a mill increase.

Gambling revenues will not be distributed until the 2008-09 school year, and even then will not benefit Districts until many other entities, the gaming board, communities where the slots are located, even the Penguins, are paid. We get what's left.

The savings are just that: savings. You don't see the money—you just do not pay it on your tax bill.

What can we do?

• Talk to your neighbors, your friends, and local business owners about this referendum question. Be open to and respectful of their opinions.



• Discuss the long-term consequences for our community and our school district if it passes.

This information was compiled by Mt. Lebanon PTA Council at the request of PTA members.

PTA does not support referendum with a resolution, but we do not have a position on Act 1 itself.