New BRT data may be flawed from the start

Assessments are better, but inaccurate property records could leave "actual value" just an illusion.

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Anthony A. P. Stuempfig stands outside his house on the 2200 block of St. James Place. His assessment stands to dramatically rise with the proposed new tax rules. ( Clem Murray / Staff Photographer )

The 2200 block of St. James Place, with its grand 19th-century townhouses and leafy sidewalks, is a quiet enclave tucked away in Center City.

Inside the Board of Revision of Taxes' computers, though, St. James might as well be Diagon Alley, the magical street in Harry Potter books.

In the BRT's records, garages appear where there aren't any. Three-story townhouses mysteriously grow another floor. One home seemed to shrink - from about 5,000 square feet to 3,700.

According to the BRT, John Caskey has a garage attached to his three-story home at 2219 St. James, on the west end of the block. But there's no garage. Never has been.

"Maybe they'll build one for me," said Caskey, a Swarthmore College professor who teaches urban economics.

With its new, "actual value" numbers, the city will ask thousands of Philadelphia homeowners, including some on St. James, to pay sharp increases in property taxes.

The proposed assessments are, in fact, generally much closer to the homes' real value than the current ones. The 22 homes on St. James, where recent sales have ranged from $710,000 to $1.2 million, have been underassessed for years.

But an Inquirer examination of the BRT's records for the block reveals a number of mistakes in the descriptions of properties - errors likely to throw off the new numbers as well.

At least eight of the 22 homes have some serious inaccuracies that include garages attached to the wrong houses and extra floors.

One single-family home, a redbrick 4,700-square-foot townhouse at 2201, is designated in the records as "store/office + apartments."

Similar errors apparently exist in neighborhoods throughout the city, an Inquirer review shows, part of a legacy of poor recordkeeping and incompetence at the BRT.

Although the new computer-driven values are an improvement, experts say there's no way that the formulas - without a huge number of inspections by appraisers - can find all the errors in the BRT's property records.

This could be a massive headache for the BRT and the city's elected officials. Fixing the assessments is already a tough sell. It will be immeasurably harder if the public decides the BRT's numbers can't be trusted.

The Nutter administration has its own doubts about the quality of the BRT's new numbers, and plans to spend the summer reviewing them "to figure out what flaws there are and why they exist," Finance Director Rob Dubow said.

That could include hiring an outside expert to review the new data, he said.

Even more tricky: At the same time they fix the assessments, city leaders are talking about overhauling or even blowing up the BRT. That debate picked up momentum after The Inquirer's recent series documenting deal-making and cronyism inside the agency.

Nutter and City Council are pulling together a task force to manage the review of the Actual Value figures and consider overhauling or dissolving the BRT.

"We need to get to actual value, but we need to get there the right way, and we need people to be confident in the new values," Dubow said.

BRT chairwoman Charlesretta Meade said the proposed numbers "address the overwhelming majority of problems that have plagued the system."

"The initiative is the most important reform of the Philadelphia property-tax system in modern history," she wrote in an Inquirer article published Thursday.

What fourth floor?

Repairing the BRT's broken assessments will mean some Philadelphia homeowners will pay less, some more. Some will pay a lot more.

There are few spots in Philadelphia where the tax bite will be worse than the 2200 block of St. James.

The block, between Walnut and Locust Streets, has the feel of classic Victorian-era New York, with 1850s brick townhouses set off by stone stairways, Callery pear trees, and 15-foot doorways. Some were designed by acclaimed architect Frank Furness.

Several of the townhouses have been divided into apartments or coated with stucco over the years. But others have been lovingly restored into jaw-dropping showplaces; one was recently listed for $1.7 million.

Over the years, as sale prices rose, the BRT fell further and further behind. That meant that the residents of St. James weren't paying their fair share of property taxes, at least when compared with people in less pricey neighborhoods.

The median market value on the block is a laughably low $269,400. Under the actual-value project, the median would be $1,049,600.

Tax bills, meanwhile, would go up an estimated 47 percent.

In fact, assessments would rocket for most Center City homeowners.

In the St. James Place zip code, which includes the Art Museum area and the west end of Center City, 90 percent of the homeowners would see a tax increase, according to an Inquirer analysis.

One of them would be Anthony A.P. Stuempfig, a retired antiques dealer who paid $56,000 for his townhouse on St. James in 1976 and, thanks to the failures of the BRT, has been paying artificially low taxes for years.

His BRT value would go from $195,000 to $880,700, handing him a huge potential tax hike.

"It's criminal," said Stuempfig, 67. "It's a real crisis.

"The only people who will be able to live here are lawyers and doctors."

But Stuempfig, like others, might have room to question his assessment. A snapshot of the BRT data from February, provided to The Inquirer, says Stuempfig has a garage. He doesn't.

The BRT also says his house is in "above average" condition. But he describes it as "a wreck," with a leaky roof, a partly rotted front door, gaps in his stone steps, and a downspout that hangs in the air two stories over the sidewalk.

Between Stuempfig's and Caskey's houses, there really is a one-car garage, complete with wood trim and a deck on top, behind the home of Douglas Clark. But according to BRT records, the garage doesn't exist.

At 2209 St. James, the property listed for $1.7 million, the real estate listings said it was about 4,992 square feet. In 2007, the BRT had it at about that square footage; for some reason, the agency's records now list it as 3,726 square feet.

The agency did not respond to requests for comment.

Not everyone on the block is unhappy about the new assessments. Keith Sheaffer, 39, a medical-equipment salesman, paid $850,000 for 2206 St. James about two years ago; since then, he has paid higher taxes than some of his neighbors.

His tax bill would stay about the same under full value. "There has to be equity," he said.

The BRT's Web site lists Sheaffer's house as four stories; it's three. "I don't know how they ever could have gotten that," he said. "It's pretty evident as you drive past there's only three stories on here."

The error was corrected in the BRT's computers, according to the 2009 data. But the correction hasn't reached the Web site.

"They're going to have to create a whole department of appeals because of inaccurate information," Sheaffer said.

'Garbage in, garbage out'

The errors in property descriptions, like the inaccurate assessments, have been a long time in the making.

Judy Hoover, union agent for the BRT appraisers, said her members complained that they repeatedly were given computer-generated printouts for thousands of buildings and told to correct all errors within a couple of weeks.

The problems were aggravated because it was sometimes impossible to fix the data in the BRT's computer systems, she said.

"Whenever they tried to correct it, the computers didn't work," she said. "It would just revert back to old information."

The cliche of "garbage in, garbage out" doesn't begin to describe the shortcomings of the BRT's data, former assessor Carl Tancredi said.

"It was toxic garbage, toxic garbage stinking to high heaven," he said.

Barry Mescolotto, the BRT's acting chief appraiser, told City Council on May 4 that the agency's new technology allows evaluators to be more efficient and accurate in keeping up with changes in properties.

"Our new system has the capability of us revaluing the city in a matter of hours," he said. "We didn't have that capability in the past."

After years of delays, the BRT finally decided last year to seek help to fix its broken assessments. The agency hired Kevin Gillen, a consultant and a fellow at the University of Pennsylvania's Wharton School, and Forrest Huffman, a finance professor at Temple University.

They took the BRT's data on all 477,000 residential properties and devised a computer model that used recent property sales records to put a new value on each one.

Gillen and Huffman said they are confident that their numbers are generally sound - at least, much closer to reality than the BRT's current values.

But Huffman acknowledged that he did find some obvious issues in the BRT's data, including a high percentage of properties that are simply coded as "average," a generalization that means the BRT isn't keeping track of which rowhouses in a block are pristine and which ones are falling apart.

The problem, he said, is that the BRT's 70 assessors can't keep up with all the changes in the city's 577,700 commercial and residential properties.

"I actually don't think they're trying to ignore the issue," Huffman said. "But they're faced with scarce resources."

Other cities undergoing mass reappraisals have brought in firms to inspect all properties, or at least have eyeballed a healthy sample.

Guy E. Griscom, immediate past president of the International Association of Assessing Officers, said it's expensive and time-consuming to get the details on properties right before doing a computerized mass appraisal.

But it's essential, he said. Otherwise, he said, owners of homes that haven't been renovated will pay more than their fair share.

In a city Philadelphia's size, bringing in an appraisal contractor would cost millions - not likely, given the budget crunch.

"You're going to have to make some tough decisions about how you are going to generate this data," said Huffman.

"Reasonably acceptable is what you're shooting for. Not perfect."

Sheaffer, the newcomer on St. James Place, said the BRT is going to have to get it right eventually, either by paying on the front end or by working through a flood of appeals.

"One way or another," he said, "It's going to cost money." 


Is your home accurately described? Find out at the tax agency's Web site, http://brtweb.phila.gov/

To read The Inquirer's three-part series "Tax Travesty" and look up the new and current values for nearly any city property, visit http://go.philly.com/brt


Contact staff writer Mark Fazlollah at 215-854-5831 or mfazlollah@phillynews.com.

Inquirer staff writer Patrick Kerkstra contributed to this article.