By Tony Romeo

HARRISBURG, Pa. (CBS) — The Pennsylvania Senate has taken another step toward an amendment to the state constitution that would have the legislature, and not courts, decide which organizations qualify as charities and are thus exempt from certain taxes.

Stressing that he is concerned about local governments being compensated for municipal services, Suburban Philadelphia Senate Republican John Rafferty views the proposal aimed at having lawmakers determine what organizations are tax exempt as a separation of powers issue.

“This is a constitutional amendment saying yes, we want it back in the hands of the General Assembly rather than the court,” Rafferty says.

But Democrats, like Minority Leader Jay Costa of Allegheny County, fear it will put the state back under an old law that they say will hurt the ability of local governments to get some kind of compensation from non-profits like universities and health systems.

“There’s a reason why just about every single statewide organization representing local governments, and a variety of other folks, are opposed to this legislation,” Costa says. “That is because we’re tying their hands behind their back.”

If the state House also approves the constitutional amendment, the question will then go to Pennsylvania voters.