Central PA Democrats endorse H.B. 451 to support municipalities with high tax-exempt property

HARRISBURG, May 28 – Central PA Democrats state Reps. Dave Madsen, Justin Fleming and Patty Kim today announced their support for legislation (H.B. 451) that seeks to establish a dedicated state funding source for municipalities that face financial challenges due to a high percentage of tax-exempt properties within their borders.

"Municipalities with significant tax-exempt properties face unique financial challenges,” said Madsen, D-Dauphin. "This legislation is a win-win for Pennsylvania. It supports communities in need, uses our state's financial strength wisely, and helps ensure that all Pennsylvanians receive the local services they deserve."

“It is a strategic solution to stabilize the fiscal situations of these municipalities,” said Fleming, D-Dauphin. "Pennsylvania is currently in a strong financial position, and with our Rainy-Day Fund reaching unprecedented levels, we can afford to support municipalities in financial distress due to high levels of tax-exempt properties."

“A program like this would lessen the burden on homeowners and small businesses in a city like Harrisburg, with its many mixed-use zones,” Kim, D-Dauphin/Cumberland, said. “And Harrisburg isn’t alone in its situation. This program would surely benefit cities across the commonwealth.”

House Bill 451 aims to provide annual financial assistance to municipalities where 15% or more of the overall assessed property value is tax-exempt. This includes areas with institutions of higher education, nonprofit medical facilities, government properties, and state game lands. These municipalities struggle to offer essential services without the robust real estate tax base available to other communities.

The representatives noted that the bill will benefit Dauphin County by reducing local taxpayers' burden by over $13.7 million. Most notably, Harrisburg City stands to gain over $5 million in financial assistance, while Susquehanna Township would receive $1.8 million.

The Tax-Exempt Property Municipal Assistance Fund would be financed with revenue from the 18% liquor tax in Pennsylvania, which was originally established to help rebuild Johnstown after the 1936 flood.

More information on H.B. 451 and the efforts of Madsen, Kim and Fleming is available by contacting their offices.