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Schools ask delay in opting for slot machine funds
Wednesday, March 30, 2005

Five Butler County school districts yesterday asked the state Supreme Court to delay the deadline for school districts to opt into the state's new program for funding education with slot machine money.

Gov. Ed Rendell said he opposed extending the deadline because he believes school boards have had enough time to study it.

Butler attorney Tom King and Pittsburgh attorney Vincent Grogan filed the motion yesterday on behalf of the Butler Area, Seneca Valley, Franklin Area, Karns City and Mars Area school districts.

The boards of the state's 501 school districts must decide by May 30 whether to accept future slots revenues -- and the restrictions that go with them -- under legislation known as Act 72.

King and Grogan are asking the high court to order a stay of that deadline until 120 days after the court rules on constitutional challenges it is hearing to Act 71, which legalized slot machine gambling in Pennsylvania. Acts 71 and 72 were approved in July.

"We do not believe school districts can render an informed decision to participate in Act 72 when the constitutionality of Act 71 hasn't been determined," King said.

To receive slots money for property tax reductions, school boards must raise the earned income tax by 0.1 percent and agree to put most future budget increases beyond the rate of inflation to a voter referendum. The boards also will have to draft budgets several months earlier than they currently do.

King said that without a delay, school boards that opt into accepting slots funding could find themselves required to comply with the restrictions of the law without having a source of funding for property tax reductions if Act 71 is later struck down by the court.

King invited Rendell, the Legislature and the Pennsylvania School Boards Association to either join or file "friend of the court" briefs in support of his action.

Two weeks ago Rendell said that he would consider a delay of the deadline if the Legislature decided one was necessary. But yesterday he said he thought the original deadline was sufficient.

"We've had plenty of time to study this," Rendell said.

So far, only four of the 501 school districts in Pennsylvania have opted into the slots program. (Philadelphia is automatically included in a special provision applying to its wage tax.) Rendell said yesterday that boards that don't opt into the program by May 30 will hurt taxpayers.

"If school boards don't opt in, their citizens don't get tax relief," said Rendell, who has said the average property tax reduction across the state would be about $333 per homeowner. Part of that reduction would be funded by the 0.1 percent earned income tax increase.

King said he has asked the Supreme Court to use its "King's Bench" power to take immediate jurisdiction in the case.

The Supreme Court heard arguments March 9 on constitutional challenges to Act 71.

That action was filed by gambling foes and good government advocates who want the justices to strike down the law that was approved in the early morning hours last July.

They contend that the legislation violates requirements of the Pennsylvania Constitution that laws address a single subject and resemble the original purpose of the bill. The slots legislation started as a single-page document on fingerprinting and state police background checks on applicants for slots licenses and became a 145-page bill legalizing slot machine gambling in Pennsylvania.

If the court strikes down Act 71, legislators would have to start all over in drafting a slots bill and getting it through the Legislature.

Pennsylvania School Boards Association spokesman Scott Shewell said his organization might file a brief in support of the motion filed by King and Grogan. He said the association also plans to file its own court action asking for a delay to the May 30 deadline.

"Our delay is more than just on the basis of Act 71. Our contention is that there are a number of issues that require definitive answers before school districts can make appropriate decisions," Shewell said. Among the questions districts would like to have answered is how much slots revenue will actually be raised, he said.

Though the governor has insisted that slots will raise $1 billion for local tax relief, school officials remain skeptical that the total will be reached and sustained over time, Shewell said.

Yesterday Rendell said school officials have been making "absurd, outright misrepresentations" about Act 72. "They are supposed to be bright people but it's amazing how few of them have actually read the act," he said.

School board members in some areas of the state have complained recently that Rendell is being a "bully" by leaning on them to take part in Act 72.

First published on March 30, 2005 at 12:00 am
Mary Niederberger can be reached at mniederberger@post-gazette.com or 412-851-1866. Harrisburg Bureau Chief Tom Barnes can be reached at tbarnes@post-gazette.com or 1-717-787-4254.
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