Saturday, July 12, 2014





Is homestead break on way out in county?

Council members agree it’ll stay for this year


January 13. 2014 11:44PM

By - jandes@civitasmedia.com






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About 86,300 Luzerne County property owners will continue receiving a $57 break on county taxes this year.


Former county controller Walter Mitchell recently proposed canceling the break to save the county at least $4.5 million.


While the 11 County Council members are divided on some issues, they all agree on this: The tax break should not be abruptly halted this year.


Several council members said they’d be open to further discussion for the 2015 budget.


Prior commissioners added the break in 2009 as part of the countywide reassessment to help property owners who reside in their home.


The homestead exempts $10,000 in assessment from county taxation on each owner-occupied residence, which equates to $57 based on the current tax rate.


“People love the homestead break. They have a deep attachment to it, so any changes would require thorough analysis,” Councilman Jim Bobeck said Monday.


Reward ownership


Councilman Stephen A. Urban, who fought for the tax break as a commissioner, said it should remain to reward home ownership, particularly for residents in low-valued properties.


The $4.5 million could be used to reduce the 8-percent tax hike shouldered by all property owners, but Urban said he wants to continue providing a benefit to those who live in their properties.


“We want people to own their own homes. Home ownership helps communities become more stable,” he said.


Councilman Harry Haas said the homestead is “not my idea of low-hanging fruit” to help the county’s tight finances. He urged the public to join the county’s push for a state sales tax increase that would help fund county services.


“I think people really depend on the homestead break,” Haas said. “The sales tax would address the many people who enjoy county services and don’t own property.”


The homestead also is off-limits to Councilwoman Linda McClosky Houck. Many property owners who receive the break are only slightly above poverty level, and the break does not apply to commercial properties or residences rented out by owners, she said.


“Everybody is concerned about property tax relief, and this is one concrete way we can provide property tax relief for people who own homes in the county,” McClosky Houck said.


Councilman Stephen J. Urban said the solution is more efficiencies in county government, not doing away with the break.


“The break is beneficial for people who have lower incomes. If someone owns a second home or property, they have to pay full rate on those,” Urban said.


Council Chairman Rick Morelli said homeowners are “attached” to the break and should not lose it this year. Council members could discuss the pros and cons of removing the break in the 2015 budget along with other options, he said.


“I think it’s a valid point to be discussed. It’s a legitimate issue to explore for each and every budget, especially if the county is strapped,” Morelli said.


For future discussion, Councilman Rick Williams said he’d like to see a breakdown of the assessments of the 86,300 properties receiving the break.


As a compromise, council could explore the legality of continuing the break for properties with assessments under a certain dollar amount, he said.


Council members Tim McGinley, Edward Brominski, Kathy Dobash and Eileen Sorokas also said they strongly support the break and do not know if any data or arguments could convince them to do away with it.


Popular tax break


Commissioners originally planned to remove $25,000 of a home’s assessed value from county taxation in the homestead but later reduced the amount to $10,000 due to the cost.


Some officials had predicted the break would be declared unconstitutional and discriminatory if challenged by businesses and other property owners who don’t receive it, but it was never contested.


The popularity of the break was realized in 2010 when past commissioner Maryanne Petrilla tried to realize the savings by eliminating the break without consulting her two commissioner colleagues. She issued a public apology to angry taxpayers, and new 2010 tax bills were issued restoring the break.




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