It never hurts to have a back-up plan.
Should Mayor Nutter’s proposal to move to a new property-tax system based on market values fail to be implemented or is applied revenue neutral Council president Darrell Clarke introduced four bills today that would provide the School District an additional $85 million either through an increase in the Use and Occupancy tax –which applies only to commercial and industrial property owners or an increase in real estate taxes.
“We may not even use these measures we just want to be in a position as we get closer to a time when we will have to vote we have every potential opportunity,” Clarke said.
Last week Councilman Bill Green proposed a similar bill that would double the Use and Occupancy Tax to raise the additional $94 million for schools --which is the amount the school district has asked Council for.
Council remains divided on Nutter’s plan to shift to a property-tax system that uses market values and collect an additional $94 million for the school district along the way. Critics have called it a back-door tax hike while the Administration has said it is simply capturing the increase in property values.
More recently uncertainty about state enabling legislation that would allow the city to adjust the millage rate down and provide a “homestead exemption” to provide relief –has further complicated matters.
» More Council offers AVI back-up plan, Inspector General to go after tax evaders?
A key complaint from critics of Mayor Nutter’s property tax plan is that the public does not understand how they will be impacted by the proposed move to a system based on market values.
But city officials today said they are planning two public information campaigns in the near future – one to explain the plan, known as the Actual Value Initiative, and the other to let people know how to apply for a homestead exemption to lower their assessment.
Of course, AVI – which would change the way property taxes are levied, as well as potentially bring in $94 million in additional revenue for school - remains very much up in the air. City Council hasn’t signed off on the plan and neither has the state, which must approve a shift in millage rates as well as grant permission for the city to offer a homestead exemption. So there are more questions than answers at this point.
Still, the firm Eightegrity has been hired to design brochures explaining the homestead exemption program that will be sent to all homeowners in June. The firm, which is being paid between $21,000 and $30,000, will also provide oversight for online materials and posters and other promotions, said Anna Wallace Adams, chief of staff to the finance director. Adams said the city was proceeding with the assumption that a homestead exemption will be available.
Also this summer, the city plans to launch a bigger marketing campaign to explain AVI, as well as some of the protections that are available to more vulnerable homeowners. The city hopes to put out a request for proposals next week to hire a firm to help that communications effort, Adams said. She said the amount of the contract had not been determined.
Given the confusion already over AVI, PhillyClout questioned whether the city may have wanted to start this earlier. But Finance Director Rob Dubow said they didn’t want to put out information until it was clear what shape the proposal takes.
City Council gave unanimous approval yesterday to a bill sponsored by Councilman Bill Green that would let people contest tickets issued by the Philadelphia Parking Authority via the Web, email, mail or fax. Currently, those who want to challenge a ticket must show up for a hearing at the Bureau of Administrative Adjudication.
“We wanted to create an option for people to appeal their parking tickets online or via email, really any electronic means so that they didn’t have to take a day off of work and lose $100 pay in order to save $24 on a ticket,” Green said.
Mayoral spokesman Mark McDonald said the Mayor will sign the bill into law. BAA director Jerry Connors said portions of the proposal will be phased in starting in the fall. Connors said the BAA will also need to beef-up on staffing.
Meanwhile Councilman Mark Squilla introduced a bill that would tack on a $4 fee on parking tickets. The money generated from the fee could bring in $4 million, he said which would be used for both the maintenance of recreation facilities and for operating costs of the Philadelphia Parking Authority Taxicab and Limousine Division.
“I still think we should make it easier for folks to appeal a ticket wrongly given," Squilla said. "If you were wrongly parked or parked illegally… I still think an extra $4 surcharge on a ticket would go a long way to help the city, not to hurt it,” Squilla said.
The Law Department has reportedly said in a memo that the city is not authorized to direct the money to city services and any money generated would have to go to the School District. But PPA said in a memo that because it’s a surcharge the money would not have to go to schools.
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Could Harrisburg lawmakers derail Mayor Nutter’s property tax plans?
That was the question raised in a City Council budget hearing today as members debated Nutter’s proposal to shift to a property-tax system that uses market values and collect an additional $94 million for the school district along the way.
The city needs state enabling legislation to make the proposal a reality – both to adjust the millage rate down and to provide a “homestead exemption” that would lower homeowner’s assessed values to provide relief. But so far, Philadelphia’s state lawmakers have not all signed on to the plan.
Some state legislators have proposed legislation that would force the city to only collect the same amount of revenue as this year. Critics have called Nutter’s plans to collect additional $94 million a back-door tax hike while the Administration has said it is simply capturing the increase in property values.
So the outcome in the state capitol remains up the air. Here’s an exchange from today’s hearing:
“It seems to me the second bill, the ability to lower the millage, if we don’t get that, that’s a real problem right?” asked Councilman Bill Greenlee.
Mayor Nutter today said he fully supported Fire Commissioner Lloyd Ayers, after the fire union called for his resignation in the wake of a Kensington warehouse inferno that killed two firefighters.
The union Tuesday said that department leadership made tactical errors that led to the death of Lt. Robert Neary, 59, and Firefighter Daniel Sweeney, 25 in the blaze on April 9. Among their criticisms was that fire commanders failed to set up a “collapse zone” — an area around the vacant, burning Thomas W. Buck Hosiery building — that should have prevented firefighters from getting too close to the blazing warehouse.
Nutter today called the criticisms "baseless" and accused the union of making personal attacks.
"There were collapse zones established...There were safety officers on the scene," Nutter said. "It is unfortunate that the union leadership, who I’ve certainly tried to work with over the time that I’ve been here, would make personal attacks on a fine public servant in Lloyd Ayers or on the rest of the fire command leadership."
Nutter said the Commisioner had his support.
I’ve known the commissioner for a long period of time,” Nutter said. “He continues to be the fire commissioner and I have great faith in his service and in his work. “
Check out the harrowing tale of a 2007 factory fire in Kensington.
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Neighbors on H Street in Kensington have been forced to deal with the remnants of a city-owned factory destroyed by arson fire in June 2007. Barbara Laker and David Gambacorta write in Wednesday’s Daily News about the problem with the hundreds of vacant factories and lots where factories once stood owned by the city.
Council members reflect on their school days during budget hearings.
Councilman Green predicts AVI outcomes with a new calculator.
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Councilman Bill Green today tried to shed more light on what will happen to city property tax bills under the mayor’s proposal to shift to a property tax system that relies on market values.
Green for weeks has been predicting that the move could prove to be a windfall for commercial property owners, because their properties are currently more accurately assessed than residential properties, which are collectively assessed well below their market values. As a result, he predicts that a shift to a tax system where a straight rate is placed on a market value could mean that business property owners in the aggregate could see their bills drop while residential property owners could see an aggregate increase.
Nutter’s plan to move to the new system, known as the Actual Value Initiative, sets a revenue goal that would memorialize two tax hikes billed as temporary and also bring in an extra $94 million for the cash-strapped school district.
Today Green unveiled a massive excel spreadsheet in which he tries to show what could happen under AVI. Based on Green’s calculations, the shift to AVI could move $200 million to $300 million in tax burden from commercial to residential taxpayers. His data also suggests that the administration’s proposal to phase in the new system over three years -- doing something known as "smoothing -- might actually create more pain than relief for many taxpayers.
A key issue here is how accurate are Green's numbers, which he said he has pulled from a variety of sources, including the Nutter administration's budget testimony and data from the Board of Revision of Taxes. The Nutter administration last week said they were reviewing their data to see if Green's projections were right. We've reached out to them again and will update if they have anything further to say today.
Green has proposed several ways to lessen the blow to homeowners. Instead of collecting an additional $94 million through AVI, he’d like to double a business tax called the Use and Occupancy Tax — which applies only to commercial and industrial property owners. Green also wants to get rid of the plan for “smoothing” in the new bills over three years, because he fears it could actually have a negative impact for many homeowners.
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David Gambacorta spent a small eternity writing about cops, drug dealers and serial killers. Now he’s writing about power and politics – which sometimes reminds him of the old crime beat. He joined the Daily News in 2005. And yes, he knows you’re not quite sure how to pronounce his last name. E-mail tips to gambacd@phillynews.com
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Catherine Lucey joined the Daily News in 2002 and has written about murderous drug gangs, political protesters and Harry Potter. After covering the 2007 mayoral election, she moved over to the City Hall bureau where she has been reporting on the Nutter administration.
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Jan Ransom, a native New Yorker, joined the Daily News in 2010 after graduating from Howard University. She has since written about the difficulty of filing police complaints, tax deadbeats and life after violent home invasions. She joined the Daily News City Hall Bureau in 2011 and has plunged headfirst into reporting on administration budget battles and City Council shenanigans.
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