For the second week in a row, Council members have introduced bills attempting to ameliorate the effects of Mayor Nutter’s property tax reform effort, the Actual Value Initiative (AVI).
Today, three Council members introduced measures – District Council members Mark Squilla and Maria Quinones Sanchez, both Democrats, and Brian O’Neill, a Republican.
Squilla’s bill would phase in over four years the changes in tax bills – both increases and decreases – that homeowners are facing from the citywide reassessment. Squilla repeatedly has raised concerns that the reassessment is full of inaccuracies.
The Office of Property Assessment has said the reassessment placed values on homes that are, on average, within 13.9 percent of market value, comfortably within industry standards. That margin, however, can mean big differences in tax bills, especially for higher priced homes.
OPA officials also say the assessments will get more accurate in the coming years, as more sales and other data is compiled. OPA is likely to focus this year on appeals from homeowners who were over assessed, Squilla said, and won’t fix the under assessed properties until next year and beyond.
He said that since the reassessment is a multi-year process, the increases and decreases in bills should also be a phased in over multiple years.
Sanchez’s bill would give businesses a $2,000 exemption on the Use and Occupancy tax, which is calculated in part on a property’s assessed value. Last year, she said, 74 percent of businesses paid less than $2,000 in U and O taxes.
The idea, she said, is to shift the U and O burden on to large commercial properties, which have seen big decreases in their assessments and, thus, are likely to get big tax breaks on property and U and O taxes. Smaller, neighborhood commercial properties, meanwhile, generally are looking at a double hit – higher property and U and O bills.
Sanchez’s bill would leave the U and O rate would at its current level - $5.51 per $100 of assessed value – but would divide the taxes collected between the city and the schools. Property taxes also are divided between the two, but U and O has been a tax dedicated solely to the schools.
The city would collect more in U and O taxes in the next fiscal year under that scenario, and Council could decide how to divide up that money, possibly giving some to the schools and using some to give a break to homeowners, Sanchez said.
The final bill, from O’Neill, addresses a city program that freezes property taxes for low income seniors. Under the bill, if a senior citizen in the program gets a tax decrease under AVI, the city would adjust the bill and freeze the amount owed at the lower amount.
There are 15,642 seniors participating in that program, according to the Department of Revenue.
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