Closing the Delaware Loophole - State Revenue and Pitt

This article briefly summarizes the current state of business taxes in the Commonwealth. As the article notes, the corporate tax for the state of Pennsylvania is one of the highest in the country, which many see as prohibiting the movement of companies into the state. However, through various tax loopholes, many multistate companies are avoiding the state taxes entirely According to a 2010 report by the Pennsylvania Budget and Policy Center, a staggering “71 percent of companies subject to the corporate net income tax pay no tax.”

Although many people have issues with the bill as introduced (See here for a politician who explains its shortcomings) many have cited the policy of closing the loopholes in general as a way of raising revenue for the state, and to potentially offset the cuts to education. Although it would lower corporate tax rates, if effective in closing the loopholes this bill could potentially raise state revenues significantly.

Although politicians disagree about the effectiveness of this particular bill, this has demonstrated bipartisan support for closing a loophole that many see as having cheated the Commonwealth out of millions of dollars. If this bill is effective, it could result in a larger flow of revenue and, as some advocates hope, a way to end the cuts to higher education.

President Revises Clause in Patient Protection and Affordable Health Care Act

Many college students support the Affordable Health Care Act because either their parents don't have health insurance or their ability to use their parents' health insurance runs out a few years after they graduate from Pitt. There is a provision in the bill that forces employers to cover birth control in their insurance policies. Last month, President Obama received serious criticism when he announced that religious institutions would have to cover birth control. To Catholics, this goes against their religious beliefs. On Friday, the White House announced that there would be new provisions to the policy, which would force insurance companies to provide birth control to women for free, instead of forcing religious institutions to pay for birth control coverage. The insurance companies would also be prohibited from increasing the cost of insurance policies to compensate for the free birth control coverage. Now that employers don't have to specifically cover birth control, every woman will have access to birth control at an affordable price. For college women using birth control, this means more money in your pocket.

Visit the White House's website at http://www.whitehouse.gov/blog/2012/02/10/president-obama-announces-new-policy-improve-access-contraception for more information.

Property Tax Assessments

Tax Results will be Case by Case

For the first time since 2002, properties assessments have been performed in the city of Pittsburgh. Despite the fact that several surrounding counties have gone decades without a reassessment, Allegheny County was forced to review its properties and set a new tax rate. Initially, local politicians and citizen groups were angered at the potential raises in property taxes, but recent studies have shown a much more complex relationship between the new values and the new taxes people will be paying. 

Since property owners, landlords, and realtors set rent prices based on the property taxes they pay, as these new taxes raise or decrease, this will likely be reflected in the rent paid by students on local housing. These new effects will be experienced on a case by case basis, with many residents seeing a tax decrease and, potentially, a decrease in rent. 

To find out how your property will be affected, first look up both its current and newly assessed price, using the following website: 

<http://www2.alleghenycounty.us/reval/Search.aspx>

At first, the new sticker price may shock you. But here's some simple math to calculate the new tax.

Value * tax rate = taxes

So, 

current value * .02941 = current taxes

new value * .01980 = new taxes

Now simply compare and see which one of these values is higher! If the current tax is higher, excellent! You're taxes are going down. If not, there are till things you can do. Mayor Ravenstahl, city Controller Michael lamb, and several council members have put programs in place to help you. If you are concerned about any of this, or any other questions, just send us an email! We're happy to help.

2012 Governmental Relations Committee

sgb.grc@gmail.com

Further reading: 

http://www.post-gazette.com/pg/12031/1207116-53-0.stm?cmpid=newspanel4

http://www.post-gazette.com/pg/12029/1206763-53-0.stm

Marcellus Shale

Senate Bill 1100 is one of the most hotly contested bills being offered up as legislation in the Pa House and Senate this year.  This bill, pertaining to the drilling for Marcellus Shale in Pennsylvania, would charge a $50,000 drilling fee for each new well, and then would decrease for each successive year that the well is in use.  Overall, the fee would generate $360,000 in revenue over 20 years.  This bill, sponsored by Republican Senator Scarnati, has received much heat from the left side of the aisle, because Democrats claim that the bill doesn’t charge enough, nor does it provide for sufficient environmental protection.  Republicans are hesitant to extract any more revenue from Marcellus Shale because they claim it will dampen business and hurt the economy.  In addition, Governor Corbett has put out a statement saying he will veto anything that has the faintest smell of a tax.  The bill passed the senate along party lines, and now is due for consideration in the House of Representatives.

Actual Text of the Bill - http://www.legis.state.pa.us/cfdocs/billinfo/billinfo.cfm?syear=2011&sind=0&body=S&type=B&bn=1100

Pennsylvania Policy and Budget Center Analysis - http://pennbpc.org/sb-1100-out-sync-most-energy-rich-states-0

Pitt SGB Elections

Just past eight last night in Nordy’s Place, the results of the 2012 Student
Government Board were announced. James Landreneau will serve as President and
the Board Members – listed in order of highest votes – are Natalie
Rothernberger, Gordon Louderback, Alex Murdoch, Zoe Samudzi, Julie Hallinan,
Olivia Armstrong, Halim Genus, and Megan McGrath. This year, about 24% of the
student body voted – a 5% increase from last year. Together with the increase
of voters last year, the percentage of Pitt Students voting for Student
Government Board has increased by about 10%. With the increasing support of the
student body it is becoming clear that there is an increased interest regarding
what is going on at Pitt. The Student Government Board has the power to allocate
$2 million from the Student Activities Fund and in the past, the lack of
interest in the elections has been a concern. Last year, the board encouraged
students to come to allocations meetings, held informative sessions, and pushed
for students to come to Harrisburg to lobby against reductions allotted to Pitt’s
state-related funding. President-elect Landreneu hopes to begin a summit for
student leaders in the future that will continue to improve the interest
student organizations have in SGB. Student Government Board has the ability to
do a lot for the student organizations on campus and with the increase of
interest the future of the Student Government Board to be an efficient entity
is promising. 

Pittsburgh's Fiscal Dilemma

On Monday, Mayor Luke Ravenstahl gave his annual Budget Address. In it, he outlined a “5-year plan” to get the city back on track financially. After citing Pittsburgh’s struggling economy of the past few years, Ravenstahl pointed out that on many fronts, the city is improving, and the budget has been balanced. The major issue facing the city currently is paying off the pension fund. Pension payments are increasing, and the city’s budget is suffering. The mayor describes his efforts to find “revenue streams” to support this growing demand, and also his desire for an immediate “large cash infusion” into the pension fund. He says that these solutions are the only way to avert the impending crisis. He also wants to reverse the “state takeover” that has been in place for the last few years under state Act 47. Pittsburgh was considered “financially distressed” and qualified for help from state authorities to balance the city’s budget and prevent financial crisis. Since the state authorities have stepped in to assist the city, Pittsburgh’s fiscal situation has improved, as Ravenstahl points out, and therefore is ready to be released from this oversight. He says that his plan is one “that recognizes the reality of state takeover and makes sure that Pittsburghers can get through the next five years unharmed even when confronted by pension payments that double and triple.”

Source Article: http://www.post-gazette.com/pg/11320/1190114-192.stm

Read the Budget Address: http://www.pittsburghpa.gov/mayor/2011_budget_address.htm

Allegheny County Property Tax Reforms

Last night, Councilman Robinson along with 8 other democrats on the Allegany County council proposed an ordinance that would increase the property tax by a 21.3%. The current property tax is .469% and would be increased by this ordinance to .569% so a property worth $100,000 would see a tax increase of $100,000. However the proposal might be against state law that prohibits a property tax increases over 5% during property reassessment years. Allegheny county has just such a property reassessment in 2012. Councilman Robinson proposed this ordinance in order to fund programs that County Executive Onorato proposed cutting in order to meet a budget cap. The proposed cuts, which total twenty three million dollars, would be to a local community college, child welfare and afterschool programs. Onorato’s proposal would also get rid of 120 county employees and possibly 1,000 to 2,000 people working for companies contracted by the county. At any rate we shall have to wait until the Thursday’s business and finance committee meeting to find out the fate of the proposal.

Source Article: http://www.post-gazette.com/pg/11318/1189884-100.stm