We received a notice our taxes will increase from $1900 to $8900...(b

[Malloy]

No question.

There are people on my block in 500k homes paying 2/3 what I pay for a 400K home, both with abatements. That also needs to be corrected.

People in the NE first, you 2nd

[macdaire]

It fascinates how people will have opinions on situations and not really read what is written.
1. I bought over 10 years ago. I never said I had an abatement. My house has never been rehabbed.
2. I like living here. I want to stay. I do not expect a reward for my decision.
3. My taxes have gone up in those ten years. They are higher than some on the block and lower than others.
4. I live and work in the city. I anticipate my taxes going up but my income will not. Infact, due to the economy, any raise is unlikely. I also own other properties and the taxes there will double. I will need to increase rents- sad.
5. I am very angry that there are millions of dollars that could be raised if they went after delinquent tax payers, some of whom are on govt. rolls and could have their wages garnished.
6. I am very dubious that any new revenue will be well spent.

Therefore, if my taxes are raised more than 5/6 times what they are, staying here would probably not be a good decision because
1. we bought wisely and could make a profit on our home
2. I have 2 children in public schools and 1 going into one. The stress around the quality of education has always been a stressor.This especially true as we approach high school and start looking at high school options.
Ultimately, If I could cash out, pay what I am paying and be assured that all 3 will get a quality education, it would make sense to move although it would deeply sadden and anger me. I love my house, my street. I love what my kids experience in this city. I However, I am not sure I will have an extra 500-1000/month spare next year. So, like others, we will play a waiting game.

[Brooke]

People in the NE first, you 2nd

Yep I paid $228K last year and value is now with some improvements around $260K. I pay $3300 in Germantown. The NW and the NE get disproportionally hit.

[Lolly]

People in the NE first, you 2nd

Okay, you third.

[ofeibush]

Forgive me...I read the first 5 pages of this thread and this may have already been resolved. If it has not been....please stop by my office tomorrow at 21st and South. We handle a few of these cases each month for clients and the process is fairly painless. Just requires going down to the OPA and getting it fixed.

Wish I could say the same for getting tax abatements in place but this type of stuff is fairly straight forward. I think our success rate is close to 100%.....happy to help free of charge.

[Malloy]

Okay, you third.

If you haven't noticed I'm not complaining. I think the ~1% I see is fair. We will see what happens next year...

[Lolly]

If you haven't noticed I'm not complaining. I think the ~1% I see is fair. We will see what happens next year...

Of course. And, agreed. More than happy to pay ~1% and think everyone would/should be.

[t_collins]

I'm in the same boat as the OP

Got a notice of proposed valuation, Something happened between this year and last and my assessment went from 97,400 to 234K. So they want to raise my taxes over 100%. Currently around 3K but now they want $7300 (my 3K is more than most of the others in my neighborhood, and the new tax rate will be more than my friends multi-million dollar rittenhouse mansion...)

Anyway, of course I am going to appeal because it is totally bogus. No other similar properties in my area hit with reassessment. I assume it was because I did renovations a few years ago (place was a dump when I bought it), but there have been plenty of sales in my area more recently for way more and they have not been reassessed. As everyone knows, the current values are bogus but that is handled by the millage etc. When they go to AVI, yes things will be go up, but with the "homestead exemption" it will be ameliorated somewhat. However, there is no exemption for 2013.

So, for anyone who has any experience, I ask these questions:

-Should I appeal in person or in writing? Do I need to retain an attorney?

-Should I contact OPA first? I tried to call them, but their message says they are closed, even though it is a business day during their own stated hours of operation.

-What are my chances of appeal? Can I appeal more than once? If I lose the appeal I am still not going to pay the tax increase. I am simply not giving the city this money.

-What should I put in the appeal as the market value I believe it shoudl be? There is no way I am going to put in the actual market value as every other property in the neighborhood is listed at or below my old value. So I am thinking just the average or the same as the 2012 value.

-My appeal will be on grounds of non-uniformity as the 2013 assessments for other similar properties are all much lower.

It is just a crapload of BS and a waste of my time. Anyone who thinks it is worth paying 10-20% of your income to this dump of a city is crazy. And yes that's what it will be w/ this tax increase, wage tax, sales tax, and all the other ways they grab your money.

thanks for any advice

[MFC]

I don't understand most of this. Care to elaborate?

I don't know how to do indented quotes, but the most obvious point I was trying to make was that if you are wielding RE tax revenue to create development and growth (the 10 yr Tax Abatements) and also encountering a need for additional tax revenue and addressing that need through policies which will harm those same communities which you are seeking to develop and grow; then one of those policies should yield. They are in opposition. So, which one has a greater impact on community and growth in the city? I think it is a certainty that the negative impact of AVI on the biggest engines of growth in the city will far surpass the positive effects of the 10 year abatements (the incentive value of which has always been debate-able).

Beyond that, I think there are real questions about what "revenue neutral" means and whether there are truly tens of thousands of overvalued properties in the city (as the AVI implementation map would suggest) or whether all of the newly projected increases in valuation in the fastest growing neighborhoods is actually driving a decrease in taxes in other areas. I find it hard to believe that there are in fact so many "overvalued" properties" when we know that the council people, the appeals process and often the appraisers themselves all tend to prevent such a result. It seems more likely to me that a truly "revenue neutral" approach would mean that the majority of properties maintain essentially their current tax levels and properties in fast growing neighborhoods see increased assessments. Collection on those increased assessments will create *additional revenue* for the city.

So, if what the city is really doing is planning to grab additional revenue from the currently undervalued properties, I say that is fine (and it is important that the assessments come into line). But do it in a manner which doesn't punish the homeowners who played no role in creating this mess and just as importantly, do it in a manner which doesn't destroy the very communities which are the centers of the greatest growth in the city. The city can bring in that additional revenue - but it can't get it all at once. There are a dozen ways to do this right - unfortunately almost none of them are on the table at the moment. Jim Kenney's plan is one (capping the taxable assessment at 3x purchase price); delaying the bulk of the increases until a property is transferred or rented might help too. For those properties, a 10% annual cap on increases might work; caps for low income, fixed income and seniors could as well. It is simply a matter of the will to do it. At the moment it seems that most of the council is simply eyeing the revenue stream and not considering the impact on the neighborhoods or future growth.

[t_collins]

I should probably add, I may have been entitled to an abatement for my renovations, but I was told it had to be a complete gut to qualify. whether this was correct or not I never did apply for it so, water under the bridge. But my renovation really just brought the house up to market standards. IE it is not worth significantly more than similar properties in the neighborhood. So it is still a case of non-uniformity, if my assessment has gone up enough to cause a +100% tax increase then all the neighbors should as well, I was not underpaying before. If this increase stands it will mean the tax on the property has increased over 1000% since 2000 (it already had gone up multiple times prior to this new assessment.

[t_collins]

So, if what the city is really doing is planning to grab additional revenue from the currently undervalued properties, I say that is fine (and it is important that the assessments come into line). But do it in a manner which doesn't punish the homeowners who played no role in creating this mess and just as importantly, do it in a manner which doesn't destroy the very communities which are the centers of the greatest growth in the city. The city can bring in that additional revenue - but it can't get it all at once. There are a dozen ways to do this right - unfortunately almost none of them are on the table at the moment. Jim Kenney's plan is one (capping the taxable assessment at 3x purchase price); delaying the bulk of the increases until a property is transferred or rented might help too. For those properties, a 10% annual cap on increases might work; caps for low income, fixed income and seniors could as well. It is simply a matter of the will to do it. At the moment it seems that most of the council is simply eyeing the revenue stream and not considering the impact on the neighborhoods or future growth.

I agree with you that though the values need to get to reality, the city doesn't deserve to grab all the cash at once. their costs have not gone up in such a fashion and the city has still been operating. We need something like a yearly increase cap (California has a 2% cap!!) to keep things reasonable. Also keep in mind, even if the market bombs, they not going to lower the values. Trust me your property tax will *never* go down, even if it is a "temporary" increase or surcharge. There are much better and fairer ways to handle the issue of property taxation, AVI isn;t even a very good way, but whatever, we will not get there in our lifetimes.

[bootsywannabe]

Valuations should reflect the homeowners cost basis, plus improvements and very modest increases each year (or none). It's normal for there to be differences in assessments, because some folks have lived in their homes for a long time, and their cost basis is low. If you apply a current estimate of their home's value in lieu of cost basis, often they won't be able to afford their home any longer, especially if they are on a fixed income, and they will be forced to sell or watch their house get auctioned for tax liens. Rather than wanting your neighbor to have the same payment as your own, we should recognize that there will be differences in valuations as there are differences in the cost basis of the homes. As homes appreciate, older residents tend to sell as they get older, and the homes are revalued then. Except in Philly dead people can keep owning homes.

[Eastcoast]

I should probably add, I may have been entitled to an abatement for my renovations, but I was told it had to be a complete gut to qualify. whether this was correct or not I never did apply for it so, water under the bridge. But my renovation really just brought the house up to market standards. IE it is not worth significantly more than similar properties in the neighborhood. So it is still a case of non-uniformity, if my assessment has gone up enough to cause a +100% tax increase then all the neighbors should as well, I was not underpaying before. If this increase stands it will mean the tax on the property has increased over 1000% since 2000 (it already had gone up multiple times prior to this new assessment.

Couple questions:

Did you pull permits for all the renovations?
Did you accurately fill out the AVI info form that was sent around in March?

I'm just curious about these proposed valuations/appraisals that are trickling in.

[MFC]

Valuations should reflect the homeowners cost basis, plus improvements and very modest increases each year (or none). It's normal for there to be differences in assessments, because some folks have lived in their homes for a long time, and their cost basis is low. If you apply a current estimate of their home's value in lieu of cost basis, often they won't be able to afford their home any longer, especially if they are on a fixed income, and they will be forced to sell or watch their house get auctioned for tax liens. Rather than wanting your neighbor to have the same payment as your own, we should recognize that there will be differences in valuations as there are differences in the cost basis of the homes. As homes appreciate, older residents tend to sell as they get older, and the homes are revalued then. Except in Philly dead people can keep owning homes.

Two points. First, the only thing the new system MUST be is rational. Similar people must be treated similarly. So, the people who say it MUST be based on market valuations are simply wrong. However, the second point is that a consensus has emerged that market rate valuation is the best way to ground assessment of property value. I think it would be difficult both politically and practically to walk that back to a "cost basis" valuation as you suggest. I don't think there is anything fundamentally wrong with a cost basis system, but many philadelphians have been paying on a slowly increasing valuation for many years, the process of gathering the data and making the market assessments is well underway and the Mayor has wagered a significant amount of political capital on making this happen. So, I think if we are looking for a real solution, the question becomes how do we move the political equation to address the shortsightedness and unfairness of the current AVI proposal in order to address the concerns that almost everyone on the board seems to share. That, atleast, is my focus.

[nuosc]

I say that is fine (and it is important that the assessments come into line). But do it in a manner which doesn't punish the homeowners who played no role in creating this mess and just as importantly, do it in a manner which doesn't destroy the very communities which are the centers of the greatest growth in the city. T

This is the stickiest issue, I think. Had the system been fair over the past decade or so, property taxes in neighborhoods like ours would have grown slowly. That in turn would probably have made growth a bit slower than it was: nobody would have been paying prices as high as they did were it not at least in part because the taxes were in general low. But now the city wants---in one fell swoop---to correct what happened over the past decade. Few if any people will be able to afford such a dramatic change---they don't budget for it the way they could have had the increase come over the course of 10 or 15 years (and which would have been a bit smaller anyway, given the slower growth the valuations would have had over that time).

What to do? Well, as I think has been mentioned, the new rules could go into effect in full force for any new sales. The buyer would know what he or she was getting in to. That probably would not be enough, though, since the turnover here is still not that high. But if the remainder of the increase came in over a longer period of time than just one year, people could adjust. Regardless of your increase (and I'm going to guess my increase will be an increase of 700% or so) you have 5 years or something. That probably still doesn't solve the city's problem for next year, but it would be marginally fairer than the "bait and switch" approach that seems to be planned---essentially folding over the increase that would have happen in 10 or 15 years into 5 years.

[ShoshTrvls]

Two points. First, the only thing the new system MUST be is rational. Similar people must be treated similarly.

No, it has to be uniform. Similar properties (not people) need to be treated similarly. That's the PA constitution, and why you can't base taxes only on sales price.

[Lolly]

No, it has to be uniform. Similar properties (not people) need to be treated similarly. That's the PA constitution, and why you can't base taxes only on sales price.

What's the actual wording of the relevant law?

[raider.adam]

Article VIII
TAXATION AND FINANCE
Uniformity of Taxation

Section 1 of the Pennsylvania Constitution provides that:

All taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws.

[ShoshTrvls]

J

Article VIII
TAXATION AND FINANCE
Uniformity of Taxation

Section 1 of the Pennsylvania Constitution provides that:

All taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws.

And to go further, "class of subjects" means the subject of the tax, e.g. Real property, personal property, etc. "Spot assessment," that is, reassessment at the time of the sale of a property, has been held unconstitutional under Article VIII. (Paradoxically, a school district can appeal an assessment at any time, including after a sale, thus providing a "back door" for spot reassessments. This happens - or at least happened during the bubble - in most of the rural counties in PA).

[MFC]

J

And to go further, "class of subjects" means the subject of the tax, e.g. Real property, personal property, etc. "Spot assessment," that is, reassessment at the time of the sale of a property, has been held unconstitutional under Article VIII. (Paradoxically, a school district can appeal an assessment at any time, including after a sale, thus providing a "back door" for spot reassessments. This happens - or at least happened during the bubble - in most of the rural counties in PA).

I am not certain that what you cited equates to what you say it means (I am also not sure that you are incorrect). More importantly, the part of my post you quoted was the first half of a response to bootsysomething (?) in which I suggested that market based valuation is the seemingly inevitable approach. So, without destroying the forum's efforts at irrelevancy, I would suggest that you (and RA) look at the thrust of the comments (which you seemed to agree with a week or so ago) that we need to protect a) the integrity of the growing communities and b) the individual homeowners who will be disproportionately burdened by the proposed approach to implementing AVI. If there is anything in the state constitution that would prevent transitioning from one assessment model to another in a manner which meets those goals, I'd be shocked (but happy to look at specific citations).

I am increasingly convinced that the biggest factor here is how you define "revenue neutral" -- if it is done properly, the revenue increases which will be seen from the undervalued neighborhoods can be done in a fair and nondestructive manner (with protections for excessive increases, longtime residents, owners on fixed incomes, and the like). If done improperly, there will be a false impetus to "balance the system" which will in fact give a huge number of small but unwarranted tax-cuts to homeowners whose taxes should instead remain flat.