Homeowner tax relief bill closer to becoming law

Philadelphia residents whose tax bills are slated to go up next year received good news Monday when a tax-relief package moved closer to becoming law.

Three bills that would allow the city more flexibility in collecting property taxes passed out of the Urban Affairs Committee in the Pennsylvania General Assembly, meaning they will eventually be voted on by the entire House. The bills address the consequences of the Actual Value Initiative, a program that included a massive reassessment of every property in the city and led to rising home values in many Philadelphia neighborhoods — including University City. The rising home values are leading to higher property taxes.

“We wanted to give the local community the tools they can use to mitigate spikes in property taxes,” said state Rep. Michelle Brownlee, who represents the neighborhoods north of campus.

Brownlee and several other Philadelphia legislators are co-sponsors of the proposals.

House Bill 390 would force the city to take age and ability to pay into account when assessing property taxes on longtime homeowners — a measure particularly targeted at older people on fixed incomes who live in gentrifying neighborhoods.

“Gentrification is meant to improve and revive established and historic neighborhoods, not to tax people out of their homes,” Rep. Mike O’Brien, the bill’s primary sponsor, said in a press release. “My bill and others like it will do a lot to relieve a burden that was quickly, and with much disorganization by the city, placed on Philadelphia homeowners.”

However, such a bill could have drawbacks for those who won’t benefit from these bills. “It basically prevents the city’s tax base from being as big as it would be otherwise,” said Fels Institute of Government Senior Research Consultant Kevin Gillen, who worked with the city on the tax overhaul. “The [other] taxpayers subsidize people to stay in their homes.”

A Daily Pennsylvanian analysis showed that home values in the Penn Alexander catchment zone — just west of campus — will rise an average of 268 percent from fiscal year 2013 to FY 2014. Many area residents have expressed concern that they will not be able to afford their rising tax bills.

Another proposal, House Bill 388, would give Philadelphia the authority to place liens on properties outside of the city — a tool some say would help the city collect taxes on delinquent properties. The liens would allow the city to prevent the sale of property in other counties until the taxes are paid in Philadelphia.

“In the case of an owner who doesn’t live in the city that owns a property that’s delinquent, the city doesn’t have much recourse,” Gillen said. “It can actually cost the city more to take that property and put it up for sheriff’s sale than they can get for it at that sale.”

A third bill would allow residents to pay their tax bills in periodic installments.

While it’s unclear how soon the bills will go to the House floor, Brownlee was encouraged by the committee response.

“The gentrification bill is going to allow residents to stay in their property,” she said.

Please note All comments are eligible for publication in The Daily Pennsylvanian.