Pattye Benson

Community Matters

TESD’s EIT Tax Study Group . . . You Have until Midnight Tonight to Apply!

I attended the TESD Public Information Committee meeting yesterday . . . primarily to fully understand the selection process for committee members and the mission of the Earned Income Tax (EIT) Tax Study Group.

Several months ago, the T/E school board decided to create a citizen tax study group and sent postcards to Tredyffrin and Easttown township residents asking those interested to fill out an application and submit it to the school district – tonight at midnight, June 15 is the deadline.

According to the application, “This citizen group will study the effects that an Earned Income Tax (EIT) would have on the School District and its residents. Following its study, the Tax Study Group members will present the pros and cons of an EIT to the School Board and the community. Tax Study Group members must be willing to be introduced publicly as the Tax Study Group and be willing to present information at one or two televised meetings. The Tax Study Group will meet up to eight times in September and October 2011.”

The EIT tax study group application contains 19 questions ranging from age, gender to level of education, profession, whether or not you currently pay an EIT and two important questions (in my opinion) Why do you wish to be a member of the Tax Study Group? and what particular expertise could you bring to the Tax Study Group?

Part of the Public Information Committee meeting agenda was to look at the selection process of the nine members that would form this tax study group. At the meeting, the school board members began constructing the process. As a means of distancing themselves personally from the members that were to be chosen, it was determined that it would be a blind, random choice based on specific criteria. For the sake of anonymity and fairness, the school board members would not know the names and addresses of the applicants.

I sat and listened as the five board members attending the meeting (Debbie Bookstaber, Karen Cruickshank, Kevin Buraks, Anne Crowley and Betsy Fadem) prepared their list of criteria in order of priority. Their order of priority of criteria for selection on the tax study group is:

1. 3 members of the group to be Easttown Residents; 6 members of the group to be Tredyffrin residents.
2. There should be a mix of people who (a) currently pay an EIT elsewhere; (b) those who are residents and work in the district and for which an EIT would be a new tax and (c) those residents that are retired and therefore would not be paying an EIT. It was suggested to include 4 members that currently pay an EIT and to include 5 members for whom an EIT would be a new tax.
3. 2-3 members should have school age children in T/E
4. Age of applicant
5. Gender of applicant
6. Renters
7. Business background

There were only 3 audience members at this meeting (1 Easttown resident and 2 Tredyffrin residents) and I sat rather impatiently listening to their criteria; not quite believing that what I viewed as the most important baseline criteria was not mentioned. As they were completing their list of criteria, I reminded them that at the school board meeting when this was originally discussed, it was agreed that the tax study group would be ‘apolitical’. I mentioned that the application had not addressed the poltical issue but recalled that Kevin Mahoney specifically suggested that current school board members and township supervisors as well as candidates for the school board and township supervisors be excluded from the group. I asked how those specific would be excluded if the names were not to be known in the selection.

To their credit, the board members immediately placed that at the top of the criteria and assured me that staff would pull any of those applications. Seeking further clarification, I asked about ‘former’ school board members or ‘former’ township supervisors – were their applications suitable. Yes. What about applicants with connections to the local political parties, were their applications suitable. The answer was yes. This suggests that Democratic or Republican committee people (or those individuals closely associated with local political campaigns) are suitable applicants for the tax study group. Attempting to further explain this study group needs to be apolitical, I suggested that when the 9 members of the group are known, the public will recogonize if these individuals are in the category of ‘political’. I have attended enough school board, finance and budget meetings to know that if 25 residents show up to any of these meetings, that is a lot of interest. Therefore, when I learned yesterday, they have received 150 applications, I do not think it is a stretch to assume that there may be some politics going on. I want this to be a very positive and informational experience for the community; not a tax study group that is tainted with politics. I am hoping that this Community Matters post will give the board time to reflect before the members of the tax study group are chosen.

The other troubling aspect of the criteria selection was that the 2 questions at the end of the application – Why do you wish to be a member and what particular expertise could you bring to the group were overlooked and may be all but forgotten in the selection process. It is important to have qualified people as members of this tax study group. We live in a community that is rich with residents with skills, background and expertise, so shouldn’t that be a major factor in the selection? In addition, ‘why’ someone wants to participate is also very telling and should be factored in the choice.

As for the actual process of the selection – it is my understanding that the decision will be made at the Finance Committee meeting on Monday, June 20. The residents chosen for the tax study group will be called and asked of their willingness to participate. All applicants will be put in to individual groups and the names randomly chosen. They feel that renters are needed in the mix and to date, there is not a single renter among the 150 applications. If you are a numbers person, happen to be a renter and want a seat at the tax study table, the odds are in your favor.

I hope that the EIT Tax Study Group selection process goes well and that residents are offering to participate for the right reason. I suggest the process be documented prior to the selection of the members; otherwise, residents are going to look at the school board members if there is a problem.

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  1. The one thing I do not understand is why they would want a majority of people on the commission that already pay an EIT? That makes no sense to me if the process is to be information driven. That means the numbers will not guide the process — but rather the inclination to step up and pursue an EIT.

  2. Many thanks, Pattye, for taking the time to attend and report on the selection criteria meeting. This is such an important decision – I fully endorse your hope that there is opportunity to refine the selection process – before “the envelopes are opened”.

    I am troubled by your report that demographics appear to be given more weight than qualifications. Further, some of the demographics make sense (T/E split, EIT payer/not, employed/retired, owner/renter) others completely don’t (age, gender), and others may be nice but might narrow the choices unnecessarily (school age children? but you’d probably get that with employed/retired).

    And clearly qualifications, skills and experience are critical to the TSG effectiveness. Maybe the Board is being smart by not being explicit ahead of the submission deadline so that they can examine honest answers to the free form questions?

    If I had my druthers, I have the Board define the attributes of their ideal members first, then rate the answers (1-5, H,M,L) on how well each of those attributes were met. Don’t get too fancy. Maybe look for things like demonstrated ability to:
    – Play well with others
    – Ask the right questions
    – Understand financial analyses
    – Communicate complex issues
    – Understand school district financials
    – Etc.
    Make the criteria public.

    Add up all the scores for each person; rank the individuals (I really like the no name idea); go down the ranking until you meet the demographics you are looking for. If you hit the Tredyffrin quota before the Easttown one, then someone maybe a little less qualified from Easttown gets selected (or vice-versa!). Won’t be as easy as this, but at least there’s a framework.

    Then, open up the selected names and eliminate anyone who is a party official of any kind or has a named position with any candidate. I fully agree with you that the Board needs to meet their commitment to make the process completely apolitical. Move down the rankings to fill any thus open positions.

    FWIW. Better than random cards from a possibly stacked deck, I think.

  3. Pattye, while i understand your meaning of apolitical insofar as not having members of the committee who are put up by parties, like an election, I think each “prisitine” member will still bring their own political bias’ to the committee. So, taking it that far out, you will never be able to have an “apolitical” body, Should the board ask if a candidate votes R or D?

    1. As I stated, I am of the opinion that committee members of TTDEMS or TTRC should be exempt from the tax study group as well as members of candidates political campaigns. By itself, an individual’s party affiliation is not a criteria to exclude an application.

  4. You find fault where none has been shown to exist. If the Group ends up being 6 GOP Party insiders and 3 Democratic insiders, then I would agree that the selection process was screwed up.

    However, they have not selected the group yet. Let us hold off on criticizing the composition of the group until we actually know what that composition will be.

    As for condemning the selection criteria, I agree that gender should not be a factor. Moreover, it is not even relevant in this case. Nevertheless, I can see that the Board is attempting to create a diverse group, and while they are a bit misguided in their approach, I for one can recognize that they are not acting maliciously or a desire for personal gain.

  5. Pattye,

    In your story you worry about partisanship hijacking the selection process, and then go on to state that “there may be some politics going on” because the Board has already received 150 applications. What is the basis for your belief that high public interest is a possible indication of partisanship?

    If the Board was truly motivated by partisanship, it would not have gone to such lengths to stoke public interest in serving in the EIT Study Group. Instead, the Board would have tried to keep public interest to a minimum so that the the pool of applicants would be limited to those individuals the TTRC and the TTDEMS want to serve.

    You should be encouraged, rather than dismayed by the flood of applicants, because it is an indication that the general public is intensely interested in the EIT issue and want to have a say in the process.

    1. MR — I am always encouraged when the community is interested! As an observation, there has been very low turnout for budget, finance and school board meetings. Just this week, at the school board meeting where the budget is finalized — I bet there were not but 20-25 people who remained after the retirement and student appreciation announcements. I see the same dozen faces meeting after meeting — so yes, I am very surprised that 150 applications have come in. I so hope that it is because people are truly interested in helping and want to particpate in the process. I don’t want it to be anything more than that — I simply made the statement based on my personal observations of attending school district and township meetings.

    2. Uh…yes it does John Petersen. If the Board only wanted the handpicked cronies of the TTRC and TTDEMS, it would have announced that it was seeking applicants in a manner that would have limited the pool of possible candidates to only those the party bosses wanted. This could have been achieved simply by announcing at a Board meeting that it was accepting applications (this would have kept the potential applicant pool limited to the TTRC / TTDEMs cronies and a few members of the public who happened to be at the meeting or watched it on TV)

      Instead, the School Board threw the doors wide open by soliciting the general public via direct mail to send applications. All of the public interest they have generated means greater public scrutiny of the selection process, which would make it far more difficult for them to pick the cronies while maintaining their credibility.

      There are plenty of examples of organizations and entities limiting the pool of potential candidates for the purpose of increasing the odds that a favored few will win.

      (1) The PA nomination process to get a name on the ballot for higher office is a perfect example of this strategy. The Reps and the Dens have rigged the system by making it nearly impossible for independent candidates to get enough signatures to get on the ballot for higher office. Why do you think the major parties do that John Petersen?

      (2) Anyone from a HR department will tell you that if there is a favored candidate for a job, but you are required by law (in the case of public sector agencies) or internal company policy to open the job up to all applicants, the best way to ensure the favored one wins is to limit the way in which the vacancy is advertised and set a short time period for the submitting an application.

      So yes, it does logically follow.

  6. The high number of people applying seems to me to signal that there are a lot of people with strong opinions on the option. This is a study commission, but given the scrutiny to applicants focusing more on demographics than qualifications, I don’t see how this can be much more than a sub-group that will debate the issue itself.
    Renters? Because they don’t pay property taxes? I cannot think of a less invested subgroup. Would they rent elsewhere if they had to pay an EIT? Do they rent here to attend the schools? So it better be a renter with school age children….?

    I agree with Ray. Articulate the qualities you are looking for, and then read the “why” and “credential” section. The rest can fall as it does. Since this is the TE school district, I see no reason to worry about Easttown vs. Tredyffrin. This is about school taxes, not where you live. Same school millage — same county assessments. Easttown pays more property tax, and Tredyffrin gets 1% transfer tax (Easttown only gets 1/2). So what does that have to do with EIT for the community? Another unrelated issue. 9 Easttown members would not alter the study…..the townships operate separately, but the school district only has one tax bill, one budget.

  7. Perhaps a lot of people watch the board meetings on TV and read the updates on the website. I do that since I can’t attend most meetings.

  8. This seems like a lot of fuss over an appointed study group. While there would be many different ways to pick the group, it seems like the board is trying to pick a group at random that represents the various perspectives in the township.

    Perhaps the error is that they should have called it a focus group and not a study group? Study group implies expertise in the people on the group. Focus group implies that the board wants feedback and perspectives from the township as a whole. That would explain why they want a mix from Tredyffrin and Easttown, genders and ages and even a renter.

    I would agree that calling it a study group is confusing as that would imply they were making a binding recommendation similar to the first tax study. The application forms could have been clearer too. The group isn’t making a recommendation one way or another but rather preparing an informational presentation for township residents. I didn’t understand the role of the group until I asked a board member about it prior to submitting my application. John Petersen and Andrea- did you realize that the study group wasn’t making a recommendation when you applied?

    The previous tax study group was mandated by law, but the board decided to create this one on its own. I wonder if any of them are reconsidering or regretting their decision to solicit public input through a study group (aka focus group) given the controversy it is stirring up on this blog. Reading the comments, I wouldn’t be surprised if a future board decided it wasn’t worth the trouble in the future to solicit public feedback through a study group. In my conversations with a board member, I also heard that this study group would cost some money. I find it annoying that the board would spend money to determine how to tax us all. Perhaps Ray or Pattye could ask about this at the next board meeting? I’d like to know how much money will be spent on the study group.

    1. I didn’t realize that there was a cost to the EIT Tax Study Group. Although, today I heard ‘third hand’ that they were bringing some kind of moderator on board for the meetings — I guess I thought that was someone on staff or a volunteer. But based on your comment, this person must be a ‘paid moderator’. Interesting, thanks for your comment.

      1. I’m not sure, but I think that this is a tax consultant of some kind. The Board approved the spending (hourly rate) in a recent meeting – if anyone has the time they could go back through the Agenda materials and find it, I think.

        I think that is actually a good idea. The way I see this TSG working best is if they come with all the questions (from each of their “constituencies”) rather than all the answers. Then this expert and if necessary others can go get the data, the TSG can organize it and iterate with the public in a meeting or two, get more questions, and than package all the data and analysis for a Board decision.

  9. why do we need a focus group, or a study group. Another example of the Board abdicating their responsibilities? Or is it for political cover? Democracy in inaction. What are the individual board members thinking on this>? I am afraid this will be beat to death. And no matter what, somebody isn’t going to be happy.

  10. FF — political cover is the correct term. If they were willing to take a stand on it themselves, they could certainly talk to their own constituents rather than trying to create a commission to bring constituent perspectives. They want someone to shoot the gun AND take the bulllet….and then they can say “well, the TSC recommended……” and see where the chips fall. Their heart is in the right place, but their courage is sorely lacking. They should be doing this study themselves….in the sunshine. A workshop on the topic would be fair and prudent — budgets used to be done that way. Not all these “presentations” of information that has been rehearsed and previewed.

  11. Well of course not everyone is going to be happy. The amount of political cover is limited because the TSG is not being asked to make a recommendation.

    But everyone should be happy for now because the Stoga boys just played a brilliant game and are now PA baseball champs.

    1. Good news Ray. Thanks for sharing.
      Now here’s the commentary: taxpayers paid for the buses to these events, the extra duty pay for the coaches, and the uniforms. Would these kids still participate at this level if they had to underwrite the process? This no doubt ran the AD out of budget with all these play off runs. Isn’t this why our taxes are lower and our increases percentage wise are higher — to catch up?

      1. Huh?

        I think that, at the top levels, parents make major investments for travel teams, coaches and practice outside of school. (And not just for sports).

        Not sure that coaches get paid extra (maybe they deserve and should get a performance bonus?), but even if the buses for all the playoffs, extra laundry, etc. cost $10K, that’s <.01% of the budget. Barely the reason for even the fourth decimal place of the tax increase. Also, just like every other area of the school budget, up front expenditure does not correlate well with performance.

        1. hold the phone PC watcher. Parents DO the laundry. Coaches do not get paid EXTRA, although they deserve it, the baseball team had a “coach” bus, not sure if the boosters (read parents) paid, or the difference between yellow buses and coach. You are scary.

          lax team took two yellow buses instead of a coach. (Cheaper)
          Yes ray, parents support these and most teams way above and beyond the school budget. Band anyone? No doubt the AD ran over budget? How do you know. Just another one eyed guess?

        2. Ray, PC and FF

          I don’t read the comments above as critical of athletic programs. I read it as it is — that TE goes the extra yard in everything it does. And FF’s comment “band anyone” is the reason we nit pick every expense. Everyone has their pet project. If things haven’t changed dramatically, the band parents man the refreshment stand at games. The band kids sell things to fund their travel events. And FF — the district does pay for the buses. These are district teams. If the boosters contribute, it is in response to a request. I very much doubt that they would decline participation in playoffs because there was no more money in the budget for buses.

          I don’t know what the budgets were for this year’s sports, but I assure you that the success probably did result in an overbudget situation for the athletic department, but that’s why they budget contingency. And it’s the incentive for boosters. Parent boosters, TEMPO (music parents), ad books for Football, the refreshment stands at games….all help to support the programs. It’s one of the reasons I personally challenge the notion of getting “advertising” on buildings etc., as I think the community already supports programs through various means, one sport or one kid at a time. Naming the refreshment stand, for example, might cost boosters thousands in program ads each year.

          Ray — your suggestion that the whole thing costs less than .1% of the budget kind of makes the point — EVERYTHING individually costs very little. It’s the accumulation of excellent programs and opportunities that bump up the costs. We could strip it all down to “what’s required” and probably keep costs much lower. It takes the whole community pulling together, and for some, that means property tax to start, and other costs to continue. For those no longer in the schools, it’s property tax, and they benefit on some level from the success of our kids.

          PC Watcher — if your point is that fewer kids might participate if there was a charge to play the sport, I think that is likely true, but I think the community would find a way.. While I see a major student activity fee as a fair way to prevent cuts to programs (since taxpayers object to increases in taxes), I don’t think a public school really SHOULD have an activity fee — because as FF and Ray points out, parents already shell out for Travel teams….and I do know many kids who have never done those because their parents cannot afford that additional level of participation. Other parents help out, and programs exist to help out, but the reality is, if we charged a substantial fee to play a sport at the high school (or at any level), there would very likely be a decrease in participation. Spread the pain — put it in the tax base. ?

          FF — it’s new seeing you try to defend spending. Parents support teams “way and above the school budget” because they can or feel they must because they don’t want to lose the program, or the quality of the program. The teams would exist without parents — but not the cadillac version that our demographics expect. That’s the point to me. Our taxes are comparatively LOW — our expectations are HIGHER than high. WHen we talk about percentage increases, we ignore real dollar increases, which are lower on our base.
          Good for these teams — and for the proud parents who help to make them great. One thing I’m betting — if the district gave up the athletic programs, parents would step in and underwrite them. Not sure Italian or German will get the same attention.

        3. Ray
          I think the reference to “extra duty pay” is actually what the compensation coaches receive is called. It’s called “EDR” — extra-duty responsibility” and has an amount attached to it. The amount each coach/ adviser/ sponsor is paid is a matter of public record somewhere. It’s approved annually. TE took it out of the contract about a dozen years ago — so it’s not negotiated, but it is pretty market driven. Things like coaches, year book advisers, club sponsors and other things result in “EDR” — extra duty pay. I don’t know if coaches get paid additionally for the season going into the playoffs. But coaching is an “extra duty”….voluntary and paid.

        4. I do understand about EDRs. I took the original reference to “these events” to be to the playoffs, which clearly incur very little incremental cost. And it’s really not true that “everything” individually costs very little.

  12. boys lax and baseball very unique group of young men. Unprecedented I think. Way to go stoga! Tennis too!

  13. give it a rest, yes I am aware that the district pays for the buses. My point was that I am also aware that the lacrosse team did not get a big coach bus, but traveled on a yellow bus. (2 actually). My understanding was that this was a decision made by new ad patrick boyle. The baseball team traveled on a coach bus. Not sure why one did and the other did not.

    And yes, you read correctly into my ‘band” comment. it can be nitpicked to death.

    And yes, I agree that if funding for say, the lacrosse team dried up, parents would pick up the tab. Again I agree, not sure about Italian nor German. But why is that? Do parents get private tutors do make up for not having it in school?? I don’t know. Frankly I am surprised the lax boosters didn’t kick in for a coach bus. But it wasn’t a big deal. The lax team with the coach bus (st Joes) lost! lax parent friends were sure to tell me that!

    I am not sure about defending spending. I was just taken aback by the comments about the cost already built in, to fund the teams that played longer and required more busing, etc due to their successes. And Ray was quite eloquent in crunching the numbers in his cost analysis.

    A large amount of the costs incurred by athletics, and band too, are defrayed by the booster clubs that support said teams, etc. Also, fund raisers held by each respective team/band/club also brings in money. So these kids, while demographically NOT challenged financially, are trying to pull some weight here. And that is good.

    While my kids are out of the district now, I have long maintained that I would gladly pay for their uniforms and other costs attributed to their involvement in exchange for not having lifelong tax increases. Once a tax is instituted, it is really never repealled. But my expenses are finished once my kids graduate. But low and behold, that is not the way it is.
    So we contribute to boosters and help with costs above and beyond budget… cadilac? Well I bet parents from Ridley to Lower Merion all do the best they can to support their kids in athletics financially above the school budget. That makes a difference and keeps the expenses lower than they would be if it all came out of taxes, no matter how much we nitpik over the budgeted costs. Hope I made some sense.

  14. Thanks FF. Here’s the quandary as I see it — the costs of running schools goes up every year as long as we presume that the salary of educators goes up every year. To date, that has been the presumption state-wide. Anything in the US that is labor-dependent in its cost structure tends to cost more each year. Schools are no different.
    So — unless there is a major turnover (transfer tax) or another source of revenue, the cost of running schools, since it is funded by property tax, drives the tax increase. Unless we cut programs, or charge for them, there is no alternative to a built-out community raising taxes annually. The clamor for an EIT among those that already pay it is to recapture dollars that are leaving the district. Makes sense. But the resistance to that has to come from those who do not currently pay it (including those without earned income who say NO NEW TAXES), who would rather see no increases at all, but certtainly not a new revenue source.

    So — absent some way to cut off cost increases, somewhat difficult considering there is no bottom line (no productivity increases that don’t translate to larger class sizes, longer bus routes, more expensive meal plans, student activity fees), your taxes do go up.

    As someone whose kids are done with the schools, you are still paying for their education. The average tax bill is $5,000 a year (being generous — some are much more , some much less). The cost of a single year of educaiton for your child is about $15,000. So for a K-12 education, that’s 36 years per child to fund it. (Clearly that is a rounded number — given cost increases and some stabilization in overall cost, it might only be 30 years). At any rate, when your kids are done, you still have a bill to pay. It is the people living in our community who do NOT have kids in the schools that actually fund the schools. Everyone else is just paying towards their educational costs each year while their kids are in the system.

    So nitpiking aside — I do see continuing to support boosters, and go to football games, and attend the plays, and buy the hoagies (or whatever they sell nowadays) as important. I know that the band takes a trip and the kids can either pay for it or fundraise their portion. As kids get busier, I’m sure more pay than fundraise, but at least it’s an option. I also know that FLITE tries to underwrite some programs that the district cost-cutting measures have eliminated. IT’s that old “takes a village” to raise, and educate, and pay for a child. Pay me now, pay me later, and pay for what you expect the community to provide. Buraks’ hamburger comments broken do wn.

  15. give, good comments. i think the answer to the issue of me paying for school when I don’t have kids in the district anymore is that when my kids were in school, there were others whose kids were out that continued to pay and subsidize my kids. Coming from me this may sound funny, but it is basically a social contract that we implicitly abide by when we buy into our community. The only way out is to sell one’s house to most probably a young couple who will subsidize before they have kids, pay a portion while their kids are in school then subsidize again when their kids are out. One of the cycles of life, albeit man made. The question of an EIT is hard for me because it is just more money out of my pocket, after real estate taxes. What will the effect of an EIT be on real estate taxes? I just can’t get my arms around a long term set off for EIT vis a vis Real estate taxes. And you can be sure that any relief in the beginning will be long forgotten as time goes by and more money is needed and BOTH taxes are ripe for increases. And there is indeed no bottom line as you said, except the good benefits of a Conestoga education, but costs are just too difficult to control.
    And throwing more money at these costs do nothing to reign in costs. It just seems that with an EIT there is no hope for real reform. And I understand that Harrisburg is the problem for the most part.

  16. FF

    Totally “on the same page.” It’s my frustration with why there is constant reference to our “increase” in taxes. There is absolutely no way to NOT increase taxes if you want to maintain the programs — given the TEEA and PSEA and retirement costs and health care costs. The state is considering legislation to ban “exceptions” to the Act 1 tax issues. Do taxpayers vote on how much to pay in social security? The state mandates public education. Local resources pay for most of it. Why, exactly, do we ignore the realities of every social contract (paying taxes) except schools, townships (police and fire) and county? Politics are local. But the local costs of living are peanuts compared to the Federal government —

    Off topic. But the reality is — we cannot “CONTROL” costs….we can only manage them. And absent a new and innovative revenue source, taxes are it.

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