The idea of raising taxes on wealthy individuals to help shoulder a big state’s education-funding burden may be gaining traction in a big East Coast state.
Tom Wolf, the Democratic candidate for governor in Pennsylvania who will face GOP incumbent Tom Corbett in November, believes that the state needs to pay a bigger share of K-12 costs and take the burden off local property taxes. To that end, the Associated Press reports, he wants to raise taxes on high earners while reducing taxes for middle-class households and exempting those with relatively low earnings from his new taxes entirely.
If that idea sounds familiar, it’s because California Gov. Jerry Brown, a fellow Democrat, successfully pushed through his own tax increase for public schools back in 2012 through Proposition 30, even though statewide tax increases are no easy matter in California. That tax increase also focused on raising taxes specifically on high earners, rather than taking an across-the-board approach.
It’s important to point out that Wolf doesn’t mention California’s tax increase in either the AP story or on his website. But Wolf’s pitch could be well-timed, as the general economic picture in the U.S. slowly improves at the same time that education spending in Pennsylvania remains a major political battle in the state.
Wolf also might be confident in pushing the idea of a tax increase because he has a great deal of political wiggle room: A running average of recent polls at Real Clear Politics shows that Wolf enjoys an advantage of 20 percentage points over Corbett.
Remember, however, that Democrats in Colorado who pushed for a statewide income tax increase last year through Amendment 66 saw their hopes crushed when voters decisively defeated it. That tax increase plan also focused specifically on high earners, although for the purposes of Amendment 66 that meant anyone earning over $75,000 annually. So the idea depends to a great extent on internal state politics.
On that front, the Pennsylvania legislature is controlled by Republicans, and while the GOP has a relatively thin majority in the Senate, it’s larger in the House. That’s another potential barrier, perhaps the biggest one, to Wolf’s plan.
It’s not exactly clear what Wolf’s plan would look like, although the AP does say that Wolf pledges a dollar-for-dollar reduction in local property taxes in conjunction with the state tax increase. Potentially, households with up to $90,000 in annual income would be spared a tax increase, and the tax increase would amount to about a 3 percent increase for those at the high end of the income scale. On his website, Wolf says that schools in Pennsylvania need both a fair, predictable funding formula and an infusion of funds, “which will help alleviate the tax burden on property owners.” Ultimately, he wants the state to be responsible for about half the K-12 spending in the state.
The state has a K-12 funding formula on the books, but the extent to which it’s actually of any use for districts has been hotly debated in Pennsylvania. Corbett recently signed a bill that requires a legislative task force to come up with a new formula.
Citing a study by the Education Law Center, a school-funding advocacy group, Wolf also says that for a typical class of 25 students, the average funding gap between property-rich and property-poor districts adds up to $75,000 for the entire class, or $3,000 on a per-student basis.
Photo: Pennsylvania Democratic gubernatorial candidate Tom Wolf speaks during an interview with The Associated Press Friday, July 25, 2014, in Philadelphia. Wolf would make a centerpiece of his first budget proposal an increase in income taxes on Pennsylvania’s higher-earners to help expand the state’s share of public education funding in exchange for a dollar-for-dollar reduction in local property taxes levied by school boards.—Associated Press
A version of this news article first appeared in the State EdWatch blog.