The new executive director of the Board of Revision of Taxes said yesterday that he could not "in good conscience" continue to value properties in Philadelphia using the "bad data" the department has relied on for decades.
Instead, with Mayor Nutter's consent, the BRT will freeze reassessments on most Philadelphia properties for up to two tax years, or until every parcel can be assessed anew.
"It is the only fair thing to do," Nutter said at a City Hall news conference yesterday afternoon.
Richard Negrin, the BRT's interim executive director, reached his decision after little more than a month on the job. Since taking the position, Negrin said, he had encountered too many errors in the BRT's data and too little professionalism within the agency to continue "business as usual."
"It became obvious that we could not continue to do assessments in the way we've done them in the past," Negrin said in an interview.
Until late last year, the BRT was out of the reach of the mayor, run by an independent board appointed by the city's judiciary.
But in December, after a series of Inquirer reports documented widespread mismanagement and cronyism at the agency, the board agreed to cede much of its authority to the Nutter administration. City Council has passed legislation that will replace the BRT with two new entities Oct. 1, contingent on voter approval in the May 18 primary.
Between now and then, Negrin said, the BRT's top focus will be cleaning up its data.
He said the agency too often gets basic facts about properties wrong, such as lot size or how many stories a home has. Some other data are too old to be reliable.
Such errors are compounded when used in modern mass-appraisal systems such as the one the BRT hopes to adopt as a replacement for its current set of inaccurate and inequitable assessments.
"It's your classic garbage-in, garbage-out scenario," Negrin said.
Given that, Negrin and Nutter said, the only fair thing to do is to keep property values at their current levels until the data can be corrected through a citywide reassessment.
The moratorium will have the effect of freezing property taxes through at least the 2011 tax year unless City Council raises the property-tax rate, which is highly unlikely.
There will be some exceptions, such as new construction and rehabilitated properties.
And, notably, the 18,000 city properties that received reassessment notices in 2009 will still be on the hook for their higher assessments.
"You have to draw the line somewhere," Nutter said when asked why it was unfair to issue reassessments in 2010 that rely on bad data, but acceptable to have used the same data in reassessments last year.
Advocates of BRT reform - some of whom have been calling for a moratorium for years - hailed the freeze but said the logic of excluding last year's reassessment notices eluded them.
"Obviously the moratorium is the correct step. Everyone acknowledges that the current system is unfair and almost certainly illegal," said Brett Mandel, a former Democratic candidate for city controller who has long sought to have properties reassessed citywide.
"But it's weak to say you have to draw a line somewhere, and that some people who have recently had their property taxes increased by 400 percent just have to accept it."
South Philadelphia resident the Rev. Ken Metzner is one of 18,000 property owners who were slapped with reassessment notices before the moratorium was announced.
"This is welcome news, and it's part of what I've been asking for," Metzner said of the moratorium. "But it leaves tens of thousands of people stranded with new assessments that used the same data."
Metzner said he planned to continue his appeal of his reassessment in Common Pleas Court.
And lawyer Peter Kelsen, who represents commercial clients before the BRT, said he was already basing his reassessment appeals on the argument that the agency's data are inaccurate, a case he said would be strengthened by yesterday's admissions by Negrin.
To some, the timing of the two-year moratorium smacks of political calculation, as new property assessments would not be mailed out until after the 2011 primary election.
The shift to a mass-appraisal system - known most recently as the Actual Value Initiative - could create enormous political headaches for both the mayor and Council members. Although the property values generated by such a system would be more accurate than the current values, many homeowners would see large increases in their tax bills as a result.
"My suspicions always are that the delays are just to get us past another election. Well, a two-year moratorium does that," Mandel said.
Negrin, a former member of the city's Board of Ethics, denied that politics played any role in his recommendation of a two-year timeline.
"Getting this done in two years is really ambitious. People need to understand this is a really herculean shift in how we manage property data in the City of Philadelphia that's going to impact the entire city, and that's going to take some time," Negrin said.
Also this week, Donna Aument, a Democratic ward leader and BRT patronage employee, sued Nutter and the BRT in Common Pleas Court, seeking to halt the mayor's partial takeover of the agency on the ground that the parties had no legal authority to make such a deal.
Aument is one of 76 BRT patronage workers, a group of administration assistants that has been exempt from city civil-service rules that ban political activity because they have been paid by the School District and not the city itself.
In December, Nutter said those workers would have to pass a civil-service exam and give up political activities to be eligible to keep their jobs.
Aument said she should not have to choose between her $36,000-a-year position and her role as a ward leader.
"The only people that are getting hurt at the BRT are the school board employees, and we are the only people who have nothing to do with the assessments," Aument, a 29-year employee, said in an interview. "We're the scapegoats. There's no other way to put it."
The lawsuit, filed by lawyer Samuel C. Stretton, contends that the takeover is illegal because it was not approved by City Council or voters, as the bill that would abolish the BRT calls for.
"It's meaningless until Council votes and the voters approve it," Stretton said. "Board members who are participating in this have abdicated their responsibilities and may be guilty of malfeasance in office.
"You can't say 'we're still members, we'll still take our pay, but you do the work.' "
Negrin and Nutter said they had not read the suit. BRT member Robert Nix III, who has spoken on behalf of the board in recent months, did not return a message seeking comment.
Read "Tax Travesty: Chaos and Cronyism Inside the BRT" and search for current property values at http://go.philly.com/brtEndText