Pa. Voters Approve Residential Property Tax Elimination

PHILADELPHIA (CBS) - Pennsylvania voters Tuesday approved a referendum which would set the stage for elimination of residential property taxes. But don't tear up your tax notice just yet.

Essentially, the yes vote on the referendum changes the state constitution to allow school districts and local governments to give home and farm owners 100 percent property tax relief.

School property taxes alone generate $14 billion a year.

Steve Miskin, the spokesman for House majority Republicans, says the good news is that eliminating property taxes for homeowners and not businesses would reduce the revenue that would have to be replaced to about $7 billion. The bad news is that $7 billion is still a lot of money.

"Even with the passage of the referendum, really we're still in a conundrum in trying to come to an agreement on exactly what to do," said Miskin.

Lawmakers have long wrestled with the issue of how to replace property taxes. Miskin says only time will tell if this change will lead to an agreement on that.