City needs to address property tax hikes

Posted 4/19/18

The relationship we have to taxes has always been problematic. In many ways this country was founded  by disgruntled taxpayers. And if there’s one thing that’s worse than paying taxes, it’s …

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City needs to address property tax hikes

Posted

The relationship we have to taxes has always been problematic. In many ways this country was founded  by disgruntled taxpayers. And if there’s one thing that’s worse than paying taxes, it’s having to suddenly pay more taxes.

This is the scenario for people in Chestnut Hill, Mt. Airy and other neighborhoods around the city – Point Breeze, Northern Liberties and South Philadelphia – where demand for housing has boosted home sales prices. When the Philadelphia Office of Property Assessment ran recent home sales figures through its algorithms to assess area homes, assessment values shot up. For some it went up more than 30 percent. Others saw steep climbs of 50 and 75 percent. Overnight, people in Chestnut Hill learned that their property tax bills were going to increase by more than $1,000. Some saw their tax bills balloon by more than $2,000.

For many years, part of the cost benefit of living in the city was lower property tax rates. While a Chestnut Hill home might cost more than a similar home in Montgomery County, the property taxes would certainly be lower. But since the city instituted the Actual Value Initiative about five years ago, those property taxes have been rapidly playing catch-up. The tax benefit has all but disappeared. As one homeowner told me last week, “It’s finally time to move.”

The city is in a tough place. As it struggles to collect money to fund schools and services in America’s poorest big city, it’s inevitably going to rely on revenue from its pockets of affluence. But at the same time, those affluent taxpayers are going to expect services for those taxes. From big quality of life questions, like good schools and quality policing to the mundane conveniences like curbside leaf pickup, with greater taxes comes greater responsibility to the people.

If the city can’t get the balancing act right, it risks losing people. Chestnut Hill and Mt. Airy, where the lifestyle is more suburban to begin with, the chances people might just leave are even greater. There are small town, village neighborhoods in West Chester, Doylestown, Glenside and Ambler, to name just a few. Some of those neighborhoods even have easy access to Regional Rail lines for commuters to Center City.

I don’t think this round of tax hikes is going to trigger a mass exodus. The city still has the opportunity to respond through appeals made by neighbors to increasing the homestead exemption from $30,000 to $45,0000 (an annual saving of roughly $210 per home owner) and by dropping Mayor Jim Kenney’s proposal to increase the tax rate by 4 percent.

In the meantime, the city must demonstrate that those taxes are being put to good use – through improving schools and recreation centers to reliable city services like trash and leaf collection and reliable snow plowing. The alternative is a Boston Tea Party in Philadelphia, which would likely look like people pushing their belongings — not overboard — but into moving vans.

Pete Mazzaccaro

opinion