McKean County officials would like to examine a change in tax
structure similar to that already under way in the region’s school
districts.

On Wednesday, the three-member panel of county commissioners
said they would be in favor of easing the burden on property
owners, but don’t feel any such movement will likely take place for
a few years down the road.

Last year, the state Legislature passed a measure – the Property
Taxpayer Relief Act – that uses projected slot machine revenues to
lower property taxes in school districts as part of an effort to
reform and improve the state’s property tax and school funding
systems.

As it stands, area school districts are already forming tax
study commissions to determine the best way to levy taxes –
including earned income, sales or personal income.

“County taxes are rising much faster statewide than school taxes
are,” Commissioner John Egbert said, adding counties are faced with
numerous federal and state mandates that don’t apply to school
districts. “Property taxes are our only way … we don’t have a lot
of choice.”

Help could be on the way, however. The main advocate for the
counties, the County Commissioners Association of Pennsylvania, is
pushing for changes to the county tax structure. Locally, a
majority of county residents struggle to make ends meet on a daily
basis, leaving property taxes a burden.

Property taxes are the primary funding source for counties to
provide such vital services as emergency management, the courts,
human services and elections offices. Local municipalities are also
faced with the same problem, but have been able to raise some extra
funds through a hike in the Emergency and Municipal Services Tax –
the former Occupational Privilege Tax – from $10 to a maximum of
$52.

“A lot of the mandates are in the mental health-mental
retardation and Children and Youth Services area,” Egbert said.
“Some mandates are changing and will soon require the county to
pick up more of the tab that previously the federal and state
governments had done.

“So far, we have been able to do all right, but you face the
inevitable.”

According to projections by county officials, there will likely
be no property tax increase for residents next year – the third
year in a row that has been accomplished. However, salaries, health
insurance and fuel costs are constantly changing, and usually
rising.

“We would openly invite other ways to raise revenue so it’s not
all on the property owners,” Commissioner Chairman Clifford Lane
said, adding he doesn’t believe anything will happen with the
proposal this year because of the upcoming elections. “Within two
or three years, maybe something will happen.”

According to figures supplied by CCAP, using revenues from 2005,
a county personal income tax of .5 percent would yield an extra
$1.17 billion for county use statewide. Meanwhile, if counties
levied a 1 percent sales tax statewide, that would provide an
additional $1.37 billion. Under the counties plan, that would be
used to directly offset local property taxes, dollar for
dollar.

The ultimate goal: the plan would promote reform through a more
even distribution of taxes based on a resident’s ability to pay
rather than the value of the property they own.

“It’s tough for people that own property to bear the burden for
the whole thing,” Commissioner Bruce Burdick said, noting he’s not
in favor of using gambling money to solve the property tax problem.
“It’s not a simple pick. I am in favor of use taxes, so those
people that spend more would pay more taxes – do it based on
consumption.”

Burdick said some states, such as Georgia, don’t have any real
estate tax in place. He also said growing the tax base in the
county could help out in the long run. The county has created an
economic development department in order to do just that, with the
hope of combining the efforts of local agencies into one focused
endeavor.

Egbert said he believes a sales tax is “very regressive.”

“Although it may seem easier for somebody on low income to pay,
it isn’t fair to them,” Egbert said. “The person with a higher
income has the ability to not spend, because they don’t need to,
where every dollar a low income person has goes to things they have
to have – food, clothing, shelter and bills. They don’t have a
choice … they do without.”

Lane would like to see a mixture of taxes.

“Bottom line, you are going to have to get the revenue from the
taxpayer at some point,” Lane said. “When you tend to go with just
one group, it’s unfair. In my opinion, a little bit of each would
be more equitable.”

Lane said the county already benefits from its hotel tax as one
source of revenue separate from property taxes.

“We are going to continue pursuing what can be done,” Lane
said.