Philly, You're In For a Tax Hike

Mayor Kenney announced earlier this month, in his budget address to City Council (page 113 on), that he intends to request that City Council pass a 6% increase in the real estate tax rate applicable in tax year 2019. Just yesterday, though, the Mayor revised that request downward to 4.1%, which means Philadelphia property owners can expect a 4.1% real estate tax increase, right? Maybe, or maybe the increase will be dramatically higher.

Mayor Kenney made the downward adjustment of his proposed tax increase on the basis that the Philadelphia Office of Property Assessment has reassessed properties across Philadelphia for tax year 2019, and those revised values have increased the tax base (i.e., property values) by 11%, overall. This means that some Philadelphia property owners can expect both an increase in their property tax assessments and an increase in their property taxes, for a total increase of some indeterminate amount.

Your property's value should be publicly available here on March 31, 2018.  If you are a homeowner, you will want to make sure to re-apply for your Homestead Exemption, the amount of which is going up, to ensure that exemption is in place by the time your 2019 taxes are due. 

For both commercial and residential owners, if you have an abatement in place, and the City has not increased your property's value but, rather, "adjusted" the allocation of value between your home and your land in such a way that increases your tax bill, you may want to challenge that reallocation (like this taxpayer successfully did). 

If you are a commercial property owner and/or developer, you should be aware that the City is currently taking the position that if you are in the process of a construction project, the improvements for which will be abated, the City can still reassess your project's value mid-way through construction for a partial increase without the benefit of that abatement (which will only kick in once the project is complete). You may want to challenge any such reassessment, and a future blog post will address the essential arguments against this new City practice.

In addition to a direct challenge, you can also view City Council's calendar to see when they will hold public hearings on the proposed real estate tax increase, the first of which will be held Monday, March 26, 2018 at 10 a.m. in City Hall (4th Floor).

 

DISCLAIMER: Nothing in this blog is intended or should be construed to constitute legal advice, and readers should not rely on it to solve their individual legal issues. No opinion set forth is endorsed by any law firm and is the sole opinion of the author. For help with any present legal issue, please consult a licensed attorney and do not rely merely on anything set forth in this website.