Time for me to get out of Philly.  The last financial benefit of living here has disappeared.

Here’s hoping you guys are lobbying councilmen as well as publishing here on a blog.  Unfortunately, my councilman is Kenyatta Johnson, whose probably too busy texting people to be bothered with this.  Besides, he also represents a most of Point Breeze, who aren’t concerned about AVI since they just don’t pay taxes.

I am torn. I hate how the answer to fixing our broken tax system is to keep it broken.

But I think it is important to make this gradual, as you said. I am not worried so much about gentifiers being hit by this — they can wait to upgrade their iphones and to buy the deluxe baby carriage. I am worried about the much more numerous middle class in NW/NE Philly seeing this as the last straw and jumping ship to Jersey or Jenkintown. For a city that has finally regained population, Philly needs to do all it can to make sure more people come each year than leave. Much better to gain 10k extra people earning and spending their money here, then to squeeze more out of who we have. While the key to population growth might be gentrifiers and more babies, the key to preventing population loss is keeping the middle class here.
At the same time, I do think that people should think they’ve been lucky for paying so little for so long. Some houses in center city are paying 1980s and early 1990s taxes, when no one wanted to go there and it wasn’t a hot market. I think a 5 or 7 year phase-in is most appropriate — 10 years seems too long and too likely to be meddled with, 3 seems a little short. The other nice thing about a phase-in is that we’ll be able to see the effects and respond accordingly, rather than jump off the cliff and count our total losses.

Last thing I want to say is that Philly weathered the housing crash pretty well. If Philly is good at anything, it’s not growing in a unsustainable way. I don’t think a 1,000 or so more dollars in taxes will put many people underwater, as you say.

Philadelphia residents are taxed as New Yorkers but this is ain’t New York. What is the root of this problem ? I think its city unions with their ridiculous entitlement system and of course City inaptitude in many areas : real estate tax collection, failed bail system etc etc

This rush to combine the AVI with a huge tax increase and jam it down everyones throats without real debate or recognition of the consequences is true insanity. Council is so unbelievably foolish here…  

They have over 10k city owned properties. They have $500mm worth of tax delinquent properties.  They have tens of millions of dollars in new tax revenue already coming online from all the 2002-2008 tax abatements and accelerating over the next 5 years.

So what are they doing? Raise property taxes to a level that will kill development in the neighborhoods that need it most. Try to reverse the positive trend in population!  Make sure to especially penalize new residents while actually giving tax breaks to those least likely to leave or improve their properties. Knock 10-20% (conservatively) off peoples home values all so that 100k deadbeats can continue to pay the city nothing. Completely crazy. What the hell are these people thinking?  

THEN IN THE FUTURE, probably after the state steps in, the Philly pols will be forced kicking and screaming to do the right thing, to comply with the law. They will sell liens on the $500mm in tax delinquencies. Probably all at once to stem a fiscal crisis. Of course, since they have screwed up the development market first, they will get maybe $250mm. A quarter billion worth of stupid.

Any politician that votes for this tax increase needs to fear for his future. There is no excuse. It is not necessary. The fix already seems in for city council. The government unions and prob council’s other special interest sponsors are already counting this $200mm a year in tax increases ($95mm plus making the temporary increases permanent). A majority of council just voted last week to offer the SEIU what amounts to a $50mm payoff. Council is completely shameless with its interest group politics. They still enjoy DROP for chrissakes. Whaddya goin to do bout it?!?

The only hope for the city is that the state steps in and doesn’t allow the city to increase taxes. Def a tough sell. Sen. Stack and a few other decent state reps need to hold out against their fellow Democrats here in the machine. The state level Republicans need to care enough to stand up for (mostly Democrat) Philadelphia taxpayers rather than laugh while we stew in the sewage of our own elected officials. 

Their plan is to enjoy this windfall for a few years as property values fall throughout the city. Probably they will re-raise the rate again to compensate. Get the rate above 2% to worst in the nation decile. They will do the same thing with property taxes that they did with the wage tax- use it to strangle the life of the city while feathering their own nests.

It is a true testament to the city that it continues to thrive despite its terrible political culture. It is amazing to think what Philly could be if its government was even minimally effective.

If you haven’t lived in the city for 10 years then fuck you.  City Council doesn’t think you’re important.

OK.  So what do we do guys and gals?  Is there a protest?  Is there a march set up to show the city’s disapproval of this?  I fear this change.  We need to speak up.  Councilmen are fighting for us, journalists are exposing this issue.  When are we going to come together as a city and speak out with our power?  We need a march.  Does anyone know of anything brewing?

Yes.  I bought a house in QV.  I am made out of money.  You can tax my 680sqft. trinity at a much higher rate than those good, hard working, men and women in Mt. Airy with their 2,000sqft worker’s cottages because I am a rich gentrifier and my Motorola Razr and lack of a car attest to my affluence.

Please.  Stop being an asshole.  I don’t think I’m better than people in the NE or NW but the idea that they are somehow more important to protect than me is idiotic.  Tax us at the same rate on our actual values and get the fuck over it.  You pretend to be happy about population increases and then the first people you attack are those of us who moved here from states or suburbs that are actually growing.  The key to population growth isn’t thinking gentrifiers are an endless source of revenue.  It’s taxing everyone the same and trying to come up with a fair tax system that treats everyone the same.

It’s a very small tax increase and a very large tax burden shift.  All it means is that house values in areas where the taxes increased a lot will go down and areas where they decreased will go up a bit.  The neighborhoods aren’t going to be any less nice to live in just because the tax burden increased.  People will still want to live there and it just means they’ll want to pay less for the house to make their overall cost about the same.

 Works for me.  Now when you can only sell your $300,000 home for $250,000 because the taxes have gone up $3,000 a year the next person will being pay about the same overall as you were paying before the taxes increased.  Equilibrium will be found and life will go on.

 Never?  The tax increase will cost a $300,000 house maybe $200.  The outrage isn’t about that or the $94 million (now $85 million).  The outrage is that the $300,000 house used to pay only $1,500 in property taxes (0.5%) and will now be paying $4,800 (1.8% with $30k exemption).  The real issue is that we live in homes assessed as if they were worth $100,000 when they’re really worth $300,000.

Maybe we can stop the $94/85 million tax increase.  We can’t stop the reassessments that increase our taxes but lower the taxes of plenty of people.

 The thing is they aren’t raising the taxes in neighborhoods that need development the most.  Tons of the parcels in North Philly will pay nothing or almost nothing with the $30,000 exemption.  It’s neighborhoods that are pretty well developed like Queen Village, Bella Vista which will be paying the higher taxes.  Neighborhoods not quite as well developed but better than a lot of the city like G-ho and NoLibs will be paying a lot more.

Mine would go from $835 to approximately $6600 in Francisville. Yikes. At least people are getting shot near me and Streets refuses to acknowledge George St behind me and wires hang all over and they have never been by to clean it in five years despite repeated requests by multiple people. Good times

Oh that’s all? And here I was worried.

 But the fact is that people are paying between $300,000 and $400,000 for those homes.  Maybe they’re stupid to do so.  Maybe you were stupid to do so.  But if the houses are worth that then in an ad valorem tax system you have to proportionally pay more than people in lesser valued homes.  Everyone has to pay the same rate.

 Haha, yeah, I’m worried too… because I bought a $300,000 home and I pay taxes on it as if it’s a $150,000 home.  But it makes no sense that homes half the value of mine in the Northeast pay twice what I do.  I’m good at ignoring my own pain if this really does create a fair system.  That’s why I’m so pissed at the gentrification bill.  I’m happy to pay the same rate as everyone else on the true value of my house even though that means huge increases for me.  I’m not happy that my neighbor Steve gets a discount because he and his wife have happened to throw their beer cans on the street for more than 10 years.

I understand I will have to pay more in taxes, and I don’t like it, but I accept it has to happen.  But as you point out, the parts I don’t like are the lack of a phase in time period (3-5 years would be fine) and the fact that ANYONE living here 10 years or more can get their taxes capped.  I think the cap should be applied based on income.  As others have stated, there is no need to cap the taxes for properties owned by people who have the means to pay them!

They talked about this before… how people of Rittenhouse are going to get capped with this policy.  Why?  I completely agree with you that it needs to be capped based on income, not length of time you have lived there.  But in reality… I kinda think NO ONE should have to pay more than 3x their current tax bill!  IT SEEMS CRAZY TO ASK FOR THAT!

Important to note: The tax increase isn’t what’s capped, but the assessment increase. As an example, look at 2234 Montrose St. in the chart above. Because their assessment is capped at $15K, their taxes actually go down to $100/year.

It’s just bad policy.

Did you read the rest of what I wrote? You quite fairly attack my stereotyping of incomers, but what about the actual proposals in this article and thread? You seem to agree with a complete phase-in (“tax us at the rate in our actual values…”), then, not a gradual system?

Thanks for pointing that out. I was sympathetic to longterm residents. But why should they get a tax cut while everyone else is getting screwed.

The answer is that the pol machine whores like kenney build a constituency this way. Creating a grifters class of $100 a year ‘taxpayers’. The majority of council are these sort of skeezy low lifes.

just a huge fu to anyone that invested in the city over the last 10 years. Your idea is the righ way to go.

I will chip in for a lawyer to contest it’s constitutionality if there’s a case here.

Seems pretty blatantly unconstitutional (pa wise) to me. If the old assessments are arbitrary rubbish, how can council create a new class of protected taxpayer around them.

It’s hilarious how this always comes up, who cares what a persons status is!?  Why have we chosen to give groups of peoples names, titles even…seems to me they are basically strong media headlines that spew hate and discomfort. If anyone lives in the city and pays the taxes, then they are citizens of the city.  Your comments are offensive.. Period. 

It would be ridiculous to cater to one part of society.  For example the city life attracts young people, it’s upbeat, fun, easy getting around.  But, when that young couple has children they have to make the choice to stay or leave, it is not a simple decision.  Choosing schools, neighborhoods, blah blah blah.  If the city were to turn away from making the city attractive for this type of people it would truly suffer.  Tons of money is exchanged whether at restaurants, stores, and inner city travel from this group of individuals, who include BLACK, WHITE, HISPANIC, ASIAN - ALL RACES.  It would suffer the same as if it turned away from “middle classers” with its lower taxes and small housing footprint.  Addtional issues would arise if the city turned away from its senior citizens who have strong roots in the city and its well-being.

So keep living in your bubble up in the NW/NE or wherever you reside, there are a few dozen other neighborhoods and classes of good people who keep this city alive just the same.

I can’t believe the proposed floor is ONE HUNDRED DOLLARS. Are you F’ING kidding me? ONE HUNDRED DOLLARS? In the suburbs, municipalities charge 5X that just as a line item for trash removal. This city really is run by a bunch of POVERTY PIMPS. I thought some of our new leaders knew better. Turns out I’m wrong. I’m sorely sorely disappointed in the likes of Bill Green, Maria QS, Curtis Thomas, and Jim Kenney. I thought they represented the new Philadelphia. Turns out I was wrong.

Thanks for clarifying.  Yes, the assessments are capped, not taxes.  Is the inherent assumption, then, that the property will be reassessed once it’s sold?  Or are these houses with capped assessments going to fall through the cracks (again) once they are sold and essentially convey the lower-assessed property to the new owners?  This really is just horrible public policy.

Here is a thought that won’t be popular with the sponsor of this site, but should be considered. No new Tax abatement properties. Or as a compromise, a 10 yr 50% abatement. The city can reassess everyone and tax at the 1.6-1.8 rate, but to help offset the reduction in value to existing homes, slow down new construction by removing the incentive to expand the housing stock. The city gets the increased revenue (since new abated housing isn’t contributing any new revenue, but does increase financial burden through increased services) and the supply of housing isn’t increased at the same rate thus helping to keep the existing housing stock’s value from falling as fast.

this is not about fairness it’s about shifting even more of the tax burden to land lords and business owners and trust me, there is a large componant of racial politics involved.

I guess my three tenants will be getting huge rent increases too, despite some being 10+ year tenants.  I don’t know that they can afford that increase, so I’ll have to eat most of it.

no.  i will sell my home that i bought 10 years ago and owe under $50,000 for a profit and move to the suburbs with my disposable income.  Someone with less disposable income than me will move in and have less money to spend in the city.  nice equilibrium

 Actually not a bad idea.  Tax abatement was set up to spur new building in the city at a time when people were leaving in droves and the city was tearing down more houses than were built each year.  Leaving a huge loophole to allow upper-middle class people to get out of paying RE tax is fundamentally unfair.

is the homestead application linked to from the article the old application or the new one? i’ve seen some with a willow grove address and others with a philly address…

at small g guest. Touche. I’m outa here too.

[...] the property tax rate will be across the city. The most recent guess was in the 1.8% range, which we’ve documented would be devastating for neighborhoods like Graduate Hospital, Fishtown, Northern Liberties, [...]

[...] summer, the City of Philadelphia dodged a bullet when the Mayor Nutter’s aggressive effort to pass AVI was rebuffed by City Council. But this fortunate turn of events did not solve the problem, it [...]