Tax Fairness for Rural PA

By State Rep. Marty Causer

We call Potter County “God’s Country,” but in some ways, it may also be appropriate to call it “Government Country.”

Of the county’s nearly 692,000 acres, 291,128 – a whopping 42 percent – are owned by the state government and are therefore exempt from real estate taxes. That leaves other landowners in Potter County with larger and increasingly burdensome tax bills.

Potter County and its taxpayers aren’t alone in this challenge.

In Cameron County, well over half – an estimated 60 percent – of the county’s total acreage is owned by the state.

In Centre County, 35 percent of its land is owned by the state (and that doesn’t include Penn State University property, which is also tax exempt).

In Elk County, 30 percent of land is owned by the state, and in Tioga County, it’s nearly 25 percent.

In McKean County, just 6 percent of the acreage is owned by the Commonwealth, though the Western Pennsylvania Conservancy has been working to acquire more than 17,000 acres of land that it would then hand over to the Department of Conservation and Natural Resources (DCNR) to be added on to the Elk State Forest. That would nearly triple the amount of state forest land in the McKean County.

In these counties, and others across the Northern Tier, government ownership of vast amounts of land is shrinking the local tax base, leaving local governments and school districts with nowhere else to go but the pockets of private property owners when it comes time to balance their budgets.

Government has long recognized the financial burden tax-exempt land can place on counties, school districts and municipalities, and it has attempted to compensate for that through “payment in lieu of taxes” or PILT. However, the PILT rate, last increased in 2006, is not keeping pace with property values or costs.

To address this fairness issue, I have introduced legislation to increase the PILT on state-owned forest and game lands from $3.60 per acre to $6 per acre. As is the case now, PILT funds would be divided equally among the municipalities, school districts and counties in which the land is located. An increase in PILT funds is an important step in the effort to achieve tax fairness for property owners in the counties referenced above and across rural Pennsylvania.

I recently received notification from the folks managing the Allegheny National Forest about nearly $2 million in funds being returned from the federal government to Elk, Forest, McKean and Warren counties based on the sale of timber from the forest. Conversely, in Pennsylvania, any proceeds from the sale of timber, oil or natural gas harvested on state-owned lands go directly into the state’s general fund. Local governments do not see a dime of it.

To address this fairness issue, I have introduced another bill calling for 20 percent of total revenue collected from the sale of these natural resources on most state-owned lands to be deposited into a restricted fund for disbursement to local governments across the Commonwealth, proportionally based on the number of acres of state land in each municipality, school district and county.

House Bills 344 and 343 are awaiting consideration in the House Environmental Resources and Energy Committee.

In the meantime, the Pennsylvania State Land Tax Fairness Coalition, led in part by Potter County Commissioner Paul Heimel and Austin Area School District Acting Superintendent Jerome Sasala, is hard at work educating state and local government leaders as well as taxpayers about the need for these changes in state law. The group has put together an informative website that includes maps and data that helps make the case for the legislation. Check it out at

Let’s work together to bring tax fairness to God’s Country and all of rural Pennsylvania.

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