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Philly's leaders need to agree on a plan to make tax deadbeats pay their share | Editorial

The Inquirer Editorial Board

Updated: Monday, December 4, 2017, 8:44 AM

Philadelphia City Council member-at-large Allan Domb, center, addresses a gathering at City Hall, Tuesday, Oct. 31, 2017. (AP Photo/Jacqueline Larma)

As of September, tax delinquents owed Philadelphia $395 million in back taxes, fees, fines and interest on 69,000 properties.

Mayor Kenney and Councilman Allan Domb have a clever plan to use tax liens to leverage $30 million or more from delinquent taxes. Simply put, they’d post the liens as collateral for bonds, hire a vendor to collect on the liens and use the money to pay off the bonds — and hopefully, come out ahead.

But Council President Darrell Clarke is saying “not so fast.” He says the liens are riddled with errors that could cost vulnerable residents their homes, which is unjustifiable under any circumstances.

Domb’s legislation, though, explicitly protects owner-occupants. They can enter into payment agreements with the city for as little as $25 a month, and for the most distressed, nothing a month. Further, the city would hire a vendor to examine its property data, which would help clean it up. Domb’s bill also protects properties that the city may want to use for future residential and commercial development.

His sights are set on the people who choose not to pay their taxes — the suburban and out-of-state deadbeats as well as the home-grown speculators who could care less that they’re dumping their share of the tax burden on the rest of us.

But Clarke isn’t convinced. In fact, he has introduced a bill exempting all residential properties, which includes rentals, in his district, which covers parts of Center City through North Philadelphia as well as Councilwoman Jannie Blackwell’s West Philadelphia district and Councilwoman Maria Quinñoes-Sánchez’s river wards district. He recently said he wants to exclude Councilman Kenyatta Johnson’s South and Southwest Philadelphia district as well.

Neither Domb nor the administration wants to throw people out of their homes. They guarantee that even after strenuous review, if a lien on an owner-occupied home winds up in the pool, it would be pulled out.

Clarke’s argument to clean up the data is well taken. He should use his power as Council president to hold hearings to find out just how dirty the data are and come up with ways to clean it. If ever there was a public interest in a fact-finding process, this one literally hits home. And it should be pulled out into public view, because it’s the public’s money, homes and businesses. He should also appoint an oversight committee to watchdog the entire process and inform the public of all it finds.

Philadelphia has tried to leverage its red ink before. In 1997, it issued $75 million in bonds backed by so many uncollectable liens, the city wound up paying bondholders $46 million. With this plan, the Kenney administration has performed gold-medal-worthy gymnastics to avoid those pitfalls and to protect residents.

The administration, Domb, and Clarke need to pour themselves a cup of hot apple cider (spiked or not), settle into comfortable chairs and talk this through. Philadelphia has an opportunity to raise some money for the schools and ensure that more people pay their taxes. Those who actually do pay their taxes shouldn’t let this opportunity get away.

The Inquirer Editorial Board

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