Property tax revenue will decline as people need more time to pay, and interest rate reductions will depress interest earnings, one expert said.
HARRISBURG, Pa. (AP) — Pennsylvania’s 500 school districts are facing a projected loss of as much as 5% in the revenue from local taxes as the coronavirus pandemic shutdowns take a heavy toll on the economy, a leading public schools group said Tuesday.
The Pennsylvania Association of School Business Officers said it is projecting a loss of $1 billion, or 5%, in revenue from local school taxes if economic recovery lags. A quicker turnaround could limit the damage to a loss of $850 million, or 4%, the group said.
School districts reported spending about $30 billion in the 2017-2018 school year, according to state data, the latest available for that statistic. About $17.5 billion in revenue that year came from local sources, primarily property taxes, and $11.5 billion came from the state, according to the data.
Rising unemployment will probably mean a loss in real estate transfer tax revenue as the economic downturn slows the real estate market, Timothy Shrom, director of research for the school business association, said in a written statement.
Property tax revenue will decline as people need more time to pay, and interest rate reductions will depress interest earnings, Shrom said.
Meanwhile, a massive deficit facing state government, as well as a delayed July 15 deadline for filing taxes, is casting doubt on how much state aid schools can expect.