Philly mayoral hopeful Abraham pins school spending on Wolf’s tax breaks

With education a major issue in the Philadelphia mayor’s race, Democratic candidate Lynne Abraham has put forth her plan to fund the city’s public schools.

Abraham, like fellow candidate Jim Kenney, has committed to meeting the Philadelphia School District’s request for $103 million, and then some.

The former district attorney’s plan has two parts. For the 2014-2015 school year, Abraham proposes raising the city’s use and occupancy tax by 12.5 percent to raise $17 million for schools. She also wants to sell off enough of the city’s uncollected tax liens to bring in an additional $88 million, for a total of $105 million.

This is not the first call for the city to collect on unpaid property taxes. Kenney’s education spending plan calls for selling a more modest number of commercial tax liens, for a total of about $40 million in the first year.

And Mayor Michael Nutter Friday announced a bid for proposals to create an “online auction” for collecting some of the estimated $465 million in unpaid property taxes.

As part of its request, the school district is seeking a recurring source of funding.

“Once you agree, on the city’s part, to fund the schools, the funding has to be continuous and permanent,” said Abraham.

Following the first year’s stop-gap debt sales, Abraham proposes meeting that criteria, pending budget changes at the state level.

The bulk of her school-funding plan for 2016 and beyond relies on Gov. Tom Wolf’s budget tax making it through a Republican-controlled state Legislature. In every subsequent year, Abraham proposes diverting $88 million earmarked in Wolf’s budget for property tax relief in Philadelphia to the school district.

While none of the candidates support Nutter’s 9.3 percent property hike to pay for schools, Abraham is calling for an increase in the use and occupancy tax to raise money from businesses. City Council hiked that tax to fund schools in 2012, and considered raising it again the following year when the district faced an over $300 million budget deficit.

To Abraham, a tax on businesses is the lesser of two tax evils.

“It’s a tough choice between choosing to give property tax hikes or a [use and occupancy] tax,” she said. “There isn’t anything that can be done that won’t cause some pain.”

Candidate Tony Williams proposes combined city and state funding of $200 million for the school district. Kenney’s plan provides for recurring funding cobbled together from local sources, instead of relying on changes in Harrisburg.

In her school-funding release, Abraham also took aim at some tax reform plans that wouldn’t necessarily contribute to schools.

She criticized a plan by Paul Levy of the Center City District and  Jerry Sweeney of Brandywine Realty that is a component of competitor Nelson Diaz’s platform. The “Levy/Sweeney” plan, as she calls it, proposes taxing different types of property (commercial, residential) at different rates, something currently barred by Pennsylvania’s Constitution and thus not likely to bring in revenues for a few years.

Abraham also knocked an older proposal by former Councilman Bill Green, now a member of the School Reform Commission,  and Councilwoman Maria Quiñones-Sánchez to lower the income tax, and another proposal to change property tax structure without a constitutional amendment as plans “that don’t address school funding.”

Here’s the full text of Abraham’s proposal:

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Lynne Abraham Plan for School Funding and Tax Reform (PDF)

Lynne Abraham Plan for School Funding and Tax Reform (Text)

For more information on where Philadelphia’s mayoral candidates stand on education, check out NewsWorks Leading Questions election series.