Does Act 1 Require School Districts to Accept Equal Installment Payments?

Act 1 of Special Session of 2006, the much heralded property tax “reform” measure also requires that Pennsylvania public school districts allow certain taxpayers (those with approved homestead/farmstead properties) to pay their property taxes in installments.  The districts are required to adopt a resolution by later this month, authorizing those installment payments and outlining the schedule for when the installments are due.

Districts must allow for at least three, but no more than 12 installments.  But must they be equal?  Some districts have proposed, for example, that the first installment must be 50% of the total tax due, with the second payment being 30%, and the third being 20%.  The Act is silent on whether the installments must be equal, so I believe that there is a good argument to be made that a reasonable plan that provides for varied installments would be permitted.  Of course, a district likely could be in trouble if the installments are so varied that they are 98%/1%/1%.

While most districts are authorizing equal installments, I believe that there is room for some reasonable variation.  Until, of course, the Courts tell us otherwise.


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