EAST STROUDSBURG — A dozen state House Democrats met with community members Tuesday in Dansbury Depot. The public forum on property tax burdens was hosted by State Rep. Maureen Madden (D-115), who plans to introduce a relief proposal later this year.
“We believe that there’s no tax that should put us out of our homes,” Madden said. “I knock on doors of teachers who have been retired for 20 years, that paid their homes off, and they truly have paid $12,000 a year in property taxes.”
“They’re deciding between medications, doctors, groceries or paying their taxes.”
Madden since 2017 has been drafting her proposal for a 50 percent average reduction in property taxes. That relief would be funded by increasing the personal income tax rate from 3.07 to 3.79 percent and imposing a natural gas extraction tax of eight cents per thousand cubic feet.
That policy isn’t set in stone, though.
“I’m open to anything at this point,” she said. “If there’s a proposal that doesn’t hurt education and gets some relief for our taxpayers, I’m all for it.”
Due to the unexpected death of a family member, Madden left Tuesday’s forum early after giving opening remarks. House Policy Committee Chairman Mike Sturla (D-96) lead the discussion in her absence.
The forum featured testimonies by three local stakeholders: Stroudsburg branch manager William Cullen of Eagle Home Mortgage, Stroudsburg School Board Member Jim Burke and East Stroudsburg property investor Jane Gagliardo. Each speaker took questions from the legislators also.
“When I started in the mortgage business, we had a rule of thumb that about 1 1/4 percent of the purchase price of the house would be about what the property taxes were,” said Cullen. “That kind of held true throughout the state, and that was in the early 90s.”
“I just did a mortgage on a house in Penn Estates, Stroudsburg. It was a $112,000 sale price with $8,400-a-year taxes — there’s no rule of thumb for that. You’ll see another $112,000 home for sale with $4,000-a-year taxes.”
Those discrepancies can be a telling indicator of the home’s age, Cullen also said. Average assessment values have risen sharply since 1989, when Monroe County last completed a county-wide reassessment.
“It affects what people can buy,” he said. “Many times, I see people where one interest payment on the mortgage is less than the property tax escrow on a monthly basis. They’re shocked.”
″‘My God, I saw the ad that said I could buy this $200,000 house for a $900-and-something-dollar payment — but they forgot to tell me about the $1,200-a-month tax estimate.’”
Burke told legislators that current conditions have degraded both sides of the tax flow problem. Limited local control over state dollars leaves schools districts few ways to pay for public education.
“We have 13 years — kindergarten to 12th grade — to make a real dent in people’s lives,” he said. “If we can invest in students during that time, then we don’t have to necessarily pay for an underinvestment in the future.”
Most of that investment currently comes from local tax dollars. Monroe County has some of the most proportionally underfunded schools in the state. Stroudsburg, East Stroudsburg and Pocono Mountain school districts are funded less than half the amount per student that some districts in the state receive.
“We’re facing a situation,” Burke said. “Do we do what’s right for the kids, or do we have to short-change our kids to keep people in their homes?”
“As a school district, we’ve done our version of clipping coupons. We’ve eliminated teachers in the classrooms. We’ve brought teachers down to half-time if possible. We’ve eliminated programs where we needed.”
“You can only clip coupons for so long… Real solutions have to happen at the state level.”
Other residents — including Stroudsburg Borough’s Council President James Smith, Vice President Boyd Weiss and Mayor Tarah Probst — also spoke to legislators, during the forum’s public comment period. The discussion became intense at times.
Tuesday’s forum was the first of what will be a series of opportunities for public input on the proposal. The date of the next event will be announced in the coming months.