With the Actual Value Initiative (AVI) raising property taxes throughout the city, many Philadelphia homeowners are wondering exactly why and how this is happening.
The main goal of AVI was supposed to be a reassessment of all the properties in the city at their current market value. The Actual Value Initiative reflects the value at which a house would be sold on the market today. Factors such as size, age, location, condition and commercial or residential use are taken into consideration when assessing properties.
There seems to be much confusion in neighborhoods as to why some properties values have increased greatly while others have stayed considerably lower.
“For residential properties, the OPA analyzes recent sales of similar properties to set the value, making adjustments for differences in the characteristics between the homes that sold and your property,” the OPA website read.
However, it seems there were no concrete guidelines released to the public which demonstrated exactly how the assessments were determined, leaving residents confused and sometimes shocked.
Although residents were supposed to receive a Notice of Proposed Value from OPA back in February for the upcoming 2014 Tax Year, many were still unaware.
“They mailed out what the assessments were to the residents and the businesses,” City Councilman Mark Squilla said. “The people had an option to do what is called a first level review, which was to send in a notice to OPA to say ‘we don’t think our value is correct.'”
Many residents throughout the city appealed their assessments, saying their home values were too high. In Whitman, volunteers at the Whitman Council assisted residents, including many elderly neighborhoods, with filing these appeals back in late September.
Appeals were made to the Board of Revision of Taxes and residents had to state their case as to why they thought the assessments were too high and incorrect. However, getting people to appeal was difficult due to the requirements of an appeal, which included going to court and explaining why the assessment was wrong. City Council offered to keep taxes the same as the year before to those who appealed while the appeals waited to go through.
“Initially, we were getting a ton of complaints through our offices that the assessments were too high, that they were wrong,” Squilla said.
Part of the reason for the large outcry was not the fact that the property taxes were being raised but the exorbitant amount to which they were increasing.
“Assessments were rasing 3, 5, 10, even 20 times what the old assessments were,” Squilla said.
Residents and city officials alike wanted to find out from OPA exactly how the department came up with these numbers and an explanation for them. The calculations, formulas and information used to complete these assessments seem to leave out many factors and characteristics of the properties.
Philadelphia is a fairly large city with many residential homes. Some believe having the OPA assessed the entire city in one year may have been rushed.
Some neighborhoods have been affected significantly more than others. The Pennsport and Whitman neighborhoods are two of the most highly affected areas, according to AxisPhilly.
Taxes on the 1700 block of 4th Street by Dickinson Square Park were raised anywhere from 100 percent to a shocking high of 699 percent. On some streets, the property taxes on the very same block vary drastically from house to house. For example on the 200 block of Mifflin Street, houses two doors away from each other varied, with one home having a 54 percent increase and another with a 184 percent increase. This just added more confusion to the methods and processes OPA used in order to fully and correctly assess the city.
“We realized we didn’t hear anything from certain areas,” Squilla said. “So then we started checking into their assessments and they were really low. And that’s because they were under assessed. We believe we have both spectrums. Some neighborhoods were overly assessed, some were under assessed.”
Squilla’s statement illustrated the confusion and disorganization which seems to have been going on during OPA’s assessments of Philadelphia properties. Margaret Schlemback, a longtime resident of Moyamensing Avenue, had a totally different experience than her brother.
“I don’t think mine went up too high,” Schlemback said. “But my brother who lives over on Reed Street, he was complaining that his really went up.”
However, not all of the reasoning for the prices goes unexplained. Many popular and up-and-coming areas, such as Queen Village, Northern Liberties and Fishtown, have higher taxes because they are locations with high sales and a high interest to buyers.
“They should have done it gradually over a few years,” said Mifflin Street resident, Lisa Grivnovics.
Councilman Squilla tried to introduce legislation which would slowly phase in the AVI by 25% a year, in order to make it more affordable for residents.
Although the system may be flawed for some residents, the City has tried to do its best to help homeowners in need by providing many options and forms of assistant to Philadelphians.
“I think an Actual Value system is something that is necessary” said Squilla. “I just didn’t agree with how it was being implemented.”
Residents could also file the Homestead Exemption, which lets anyone who is a homeowner get $30,000 off their property taxes. However, the only requirement for the Homestead Exemption was the resident had to own their own home. The only reasons for denial for the Homestead would be an incomplete form, if the name on the application did not match the deed and if the owner had another primary place of residence.
Senior Citizens could freeze their taxes if they made under $25,000. The newest service offered was Longtime Owner Occupant Properties (LOOP), which helped residents who have lived in their homes for over ten years and whose taxes have tripled due to the AVI.
To view a map of the property tax changes, click here. For more information about OPA, visit their website.