The Spruce Hill Community Association (SHCA) is appealing to the City Council to delay the implementation of the controversial property tax assessment overhaul, the Actual Value Initiative (AVI), which could help bail out the city beleaguered school district by increasing taxes on long under-valued properties. Residents in neighborhoods where property values have far outpaced the city’s valuation could see their property tax bills double, triple or even quadruple.
City Council is expected to consider AVI legislation at Thursday’s regularly scheduled meeting. The City Council has until July 1st to submit a new budget and tax rate. But the property assessments needed to implement the AVI have not been completed. That’s one of the reasons the SHCA is pressing for a delay.
In a letter sent to members today, SHCA President Ed Halligan urged the City Council to take more time to let residents prepare for what could be substantial changes to their tax bills. The extra time would also allow city assessors to do a thorough inventory and assessment of the city’s housing stock.
Several versions of the AVI have been floating around City Hall and it is unclear what the final version might look like. What does look certain is that a basic formula will hold: If your home has been assessed too low, your taxes will likely increase.
While homeowners would be hardest hit, many renters will probably not be immune from dramatic tax increases as property owners will likely look to pass on the added costs.
There are lots of resources available on the AVI and we will collect them when and if it’s passed. Meanwhile, here is a good primer on the AVI that Plan Philly put together a few weeks ago.
Below is a copy of the SHCA letter to Councilwoman Jannie Blackwell.
SHCA letter to Jannie Blackwell
June 13th, 2012 at 2:02 pm
Spruce Hill is one of, if not the hardest hit neighborhood in the city by this property tax increase. Depending on which version passes, average increase in Spruce Hill could be around $5,000, which is much higher than elsewhere. Everyone should pay their fair share, but this is a tough burden on anyone to hit all of a sudden.
June 13th, 2012 at 2:20 pm
Criminals and liars every one of them. This will chase people out of the area. I know some who already left. The city services stink and the schools are no better (no offense to those who try so hard, but seriously).
The longterm impact of this kind of decision will hurt those who can’t afford to be hurt any more than they already are. The city will be left with the rich and the exempt.
June 13th, 2012 at 5:12 pm
Just to point out, renters will not only not be immune, they will be hit just as hard as homeowners. If my landlord’s tax bill goes up $5000 next year, I can guarantee you that my rent will increase by whatever share of $5000 is proportional to how much of the property I occupy/pay for. Or at least close to it.
I hope the city looks long and hard at what this will do. People will likely get hit with massive property tax hikes and then also see their property values plummet, as a result of the increase in taxes. I think the current property tax system is a joke, and that increases are warranted, but I’d hope that the mayor and city counsel will phase this in over many years, to lessen the impact on neighborhoods like ours.
June 14th, 2012 at 12:15 am
If anything property prices should go down. There’s enough empty houses out there as is…
June 14th, 2012 at 7:11 am
They also need to look at the terribly designed anti-gentrification rules Kenney proposed. They actually make the system more inequitable and arbitrary if that were even possible.
Kenney’s formula is 3x current assessed value, less the $30,000 homestead, * 1.8. Since current assessed value is completely arbitrary, you will have some people in $300k homes (renovated shells for example) who have $10k or $15k assessments actually get a huge tax reduction to $100 a year.
This while their neighbors would get likely a huge increase to $5400. If you owned it for 10 years, you can pay 1/50th of your neighbor. Sounds fair, right? Of course if you held the property over 10 years in a gentrifying area, you are probably much richer than your neighbor anyway!
Kenney’s provision is a big part of why the rate @1.8% is so much worse than what people expected. Supposedly it would be 1.5% without this crazy subsidy, though no one really has (or will give us) the numbers.
I guess the silver lining is that Kenney’s gentrification rules seem blatantly unconstitutional.
June 14th, 2012 at 9:34 am
Call Jim Roebuck and State senator Williams
Call all of City Council and tell them you oppose this.
Open your windows and scream.
http://www.phila.gov/citycouncil/CouncilMembers.html
June 14th, 2012 at 9:44 am
Everyone can tone down the hysteria substantially by checking one of the tools for estimating the proposed tax, such as the one at http://ppiin.org/avi-impact-map/. Even if I inflate the value of my house by $75,000 over what Zillow estimates as its market value, I only see an increase in tax of $2500, which doesn’t even bring my TOTAL tax to the $5000 Andy mentions as an INCREASE. While I don’t have an extra $2500 lying around, I don’t see the reason to freak out about the rate adjustment just yet.
And if Spruce Hill is “hardest hit,” all that means is that we’ve haven’t been paying our fair share in the past. It’s not like we would be assessed at a different rate than the rest of the city, so if anything, the end result would be MORE fair.
June 14th, 2012 at 10:01 am
Osager–help me with your math. if your TOTAL tax is $5000 that means that you are currently paying $2500 on a home that Zillow values at $200k?
You must be the outlier who is paying FAR more than your neighbors.
June 14th, 2012 at 10:07 am
Thanks for the link, Osager. On that tool, it says my property tax would increase a multiple of 4.
Clearly, property taxes have been miscalculated in Spruce Hill for a long time, but this is a serious tax shock to hit all at once in a down economy. No faze in at all? Seems crazy to suddenly hit an entire neighborhood with thousands of dollars more per household.
June 14th, 2012 at 10:12 am
this city is completely F##KED. empty and abandoned property and poverty are 2 of the worst issues this city has. and now this. we need to be putting people in these homes not forcing them out with higher taxes.
June 14th, 2012 at 1:45 pm
I find this all a bit much, coming from Spruce Hill, which enjoys one of the best public schools in the city and the side benefit of higher property values/home equity than the rest of us.
A major goal of AVI is to find a revenue to help the school district close a structural budget gap. If people want better public schools in the city, they should be willing to pay more in property taxes, it’s that simple.
June 14th, 2012 at 1:48 pm
Time to finally pay up. I welcome this, it’s total BS that people can live in these areas and not pay their share.
June 14th, 2012 at 2:04 pm
Also, couldn’t SHCA have had one of their officers who DIDN’T take a fat DROP check from the city upon retirement sign off on the letter? DROP recipient to Blackwell complaining about taxes that is too funny…
June 14th, 2012 at 2:22 pm
Happy Curmedgeon, sorry if I was unclear–even after the proposed increase, even if I wildly inflate the value of my house for the purposes of calculating the increase, I still would pay under $5000 annually. And my neighbors are all paying about the same property tax currently. Perhaps our block is an outlier.
June 14th, 2012 at 3:10 pm
I actually don’t mind paying more, but a %200 increase with no graduation is not fair. It’s been screwed up for a long time, taking a few years to make it right so people can budget it in slowly won’t break the system.
June 14th, 2012 at 3:13 pm
I live in Spruce Hill and I do not “enjoy” one of the best but one of the WORST schools. Getting into a good school in Spruce Hill, for me, would be an equivalent process to getting into any good school in the city. I fail to see your point.
As far as paying a fair share, I say BS to that. Fair is that I have always paid my bills and my taxes and I chose a house and got a mortgage based on all the components that calculated an affordable monthly payment.
To suddenly–very suddenly–be expected to be okay with an unnamed tax increase (in the thousands) based on a yet-to-be-seen valuation of my property makes no sense. They are asking us to sign a blank check.
These property tax increases are not going to improve the city. They will fill the gaps created by criminals who don’t pay their taxes and criminals who work in the government and overspend.
June 14th, 2012 at 5:43 pm
We created an version of the AVI Impact Map that focuses on West Philly and put it here: http://ppiin.org/west-philly-avi-map/ Let us know if we can provide more information.
June 14th, 2012 at 8:45 pm
AVI delayed one year. Maybe they can use that time to get it right and in the meantime put some teeth in the law to collect back taxes from the nogoodnik deadbeat owners. $515million!?
June 14th, 2012 at 10:03 pm
Happy Curmudgeon and neighbor, it’s all in how “Spruce Hill” is defined, no? Wikipedia, which of course we can trust, says that Spruce Hill ends at 46th, which more or less maps onto the PAS catchment, which of course has enjoyed (if that’s the right word) a rapid increase in property values because of PAS.
It would be a bitter pill indeed if those of us outside of the PAS catchment are considered “Spruce Hill” and our homes are evaluated as equivalent to those in the PAS catchment. (Technically, I think those of us west of 46th and east of 52nd are in “University City,” according to the city. Who knows what that means for AVI.)
June 14th, 2012 at 11:58 pm
The calculator says our taxes would jump from $1000 to $4000. Is that real? We bought our house for less than a third of what Zillow says it’s worth in 2002 and really cannot afford such a jump to suburban-level taxes. $250 extra a month added to our mortgage would force us to move. But maybe that’s the intention?
June 15th, 2012 at 4:20 pm
@Osager–yes, indeed. I am not in catchment because I refuse to pay an add’l $75k to purchase the right to attend PSA. If we were in, it would be a question of whether we would send a kid there anyway or maybe more importantly whether that option would exist at all.
Either way, we ARE in Spruce Hill and our house has increase in value along the general curve not some exponent.