City Council concerned about Harrisburg, AVI

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.

The city’s Finance Director, Rob Dubow said, “That’s a real problem. Yes. And if we don’t get the homestead we’ll have some real problems.”

Greenlee: “Yeah I agree with you on both, but it seems like if we don’t get that ability to lower the millage what do we do?”

Dubow declined to speculate on that.

“Yes, because if we don’t get that it’s a problem,” said Greenlee. “We’re hearing that there’s problems in Harrisburg.”

Councilman Mark Squilla asked Dubow if the Administration has a plan B in case the state enabling legislation is not approved. Dubow said they were considering options.

But that was not enough assurance for Council president Darrell Clarke who said he and Council will formulate a back-up plan.

“What this Council is not going to do is wait until all of the state actions required to proceed with this process, we’re not going to wait until that is all done before we start outlining a plan B,” Clarke said. “The concerns we had started internally because we didn’t have certain information it has now expanded to the state and the uncertainty of the state legislation that is required for us to move forward. So this is continuing to be a troubling process.”