Since AVI numbers were released last week, we’ve speculated that assessors never actually visited any properties, and we lamented the fact that the OPA has severely undervalued land across the entire city. Today, we reflect on perhaps the most alarming aspect of AVI that we’ve discovered so far: after two years of work and tens of thousands of man hours, the assessment numbers seem to be, well, wrong. You can see why this is a problem, right?
To illustrate, we’ll use the example of the 1100 block of Dorrance Street, in Point Breeze. On this block of 38 homes, we used our expertise to determine the expected sale price for each home on the block, and compared that to the new assessments from OPA. Based on this analysis, exactly half of the homes were underassessed, and half were overassessed.…
Note: We know that property tax talk is boring. Read this anyway, it’s important.
As many of you have probably observed in terror, our fair city’s leadership is currently endeavoring to fix our long-busted property tax system. Much has been made of the mayor’s proposal to tuck a $94M tax increase to benefit the school district into this effort, but today we bring a potentially destructive, totally unintended consequence of the Actual Value Initiative (AVI) to your attention, hopefully before it’s too late.
We are totally petrified about what AVI could mean for small business in Philadelphia.
What are they doing?
Because AVI will mean lower tax bills for major pieces of commercial real estate in Philadelphia, like the Liberty Towers, some members of city council have suggested increasing the Use and Occupancy tax rate, to recapture some of that lost revenue. Use and Occupancy tax, for…