Tax bills set to increase — again — for homeowners as Philly releases new assessments
More than 345,000 residential properties — three-quarters of the total — are getting assessment increases next year, according to the city’s 2020 assigned market values. The new values come as the city is still facing fallout from increases to residential assessments for 2019.
Eileen Nisenfeld and her husband, Alan, bought a twin ranch home in Philadelphia’s Rhawnhurst neighborhood in 2001, raised their children in it, and have continued to enjoy their street even as other relatives left the city for Bucks County or South Jersey.
But this week, when Nisenfeld, 45, checked her property records online and found out the taxes on her Summerdale Avenue home would increase for the second time in two years, she said she is starting to feel “scammed.”
“We have no problem paying taxes. But in Philadelphia we pay the city tax, we pay the wage tax ... what are we getting for these taxes?” she said. “Show us where the money is going before you just come around and assess my house based on a drive by or what my neighbor’s house sold for.”
Nisenfeld’s property assessment, or the value used to calculate real estate tax bills, increased 14.9 percent this year. It will increase by an additional 9.8 percent next year, according to the 2020 property assessments released this month. As a result, her tax bill will have increased from $1,963, to $2,445 between 2018 and 2020.
More than 345,000 residential properties — three-quarters of the total — are getting assessment increases next year, according to the city’s 2020 assigned market values. Citywide, the median assessment of single-family homes will increase by 3.1 percent, according to an Inquirer analysis.
Nisenfeld’s middle-class Rhawnhurst neighborhood will have the largest increase in the median value of a single-family home in 2020, according to the Inquirer analysis. And several neighborhoods, including Queen Village, Eastwick, Bella Vista, and Southwest Philadelphia, will have median increases of more than 8 percent.
The 2020 values, which are being mailed to property owners this week, come as the city’s Office of Property Assessment (OPA) is still dealing with fallout from last year’s residential revaluation that sparked outrage from homeowners and City Council after the assessment of the median single-family home increased by 10.5 percent.
“If this is going to constantly keep escalating at these levels we’re never going to get to the point of affordability of people being able to stay in the neighborhoods they grew up in,” Councilman Mark Squilla said at a budget hearing last week.
Unlike other counties in the state, Philadelphia is not required to change tax rates when assessments increase to make the changes revenue-neutral. That means every increase is a tax hike; the city estimates it will receive an additional $53 million in property tax revenue as a result of the 2020 revaluations. That amount includes increases in nonresidential properties; other changes include a 6.5 percent increase to the total value of commercial and industrial property assessments, according to OPA, and an 8.1 percent increase for condos.
In several neighborhoods, the increases are steep when considering the cumulative impact of the 2019 and 2020 changes. Point Breeze, will have the largest increase over that two-year period; the median assessment increased 54.3 percent from 2018 to 2020, rising from $85,200 to $131,500, The Inquirer found.
Last year’s assessment hikes led to an independent audit commissioned by City Council that found the city’s assessment methods are flawed, and Mayor Jim Kenney gave in to Council’s calls for new leadership of OPA and launched a search in February for a new chief assessor. City Council has called for other reforms and increased transparency, including asking OPA to publicly explain its assessment methodology.
The Kenney administration, which disagreed with the audit findings, stands by its valuations and hired its own consultant to make recommendations for improvements. City spokesperson Mike Dunn said in an email that the 2020 assessment “resulted in moderate changes." More than 95 percent of residential assessment increases will be less than 10 percent, Dunn said. He encouraged property owners who disagree with their values to file appeals.
The 2020 values include decreases for more than 80,000 homeowners, Dunn said. The Inquirer analysis found that the median value will decrease in about a dozen neighborhoods. Hunting Park will have the greatest decrease, at 22.8 percent. An Inquirer analysis of the 2019 assessments found that Hunting Park was the most-overassessed neighborhood in the city, meaning homeowners may have been paying more than their fair share in taxes.
Assessors looked at market trends and applied factors to 16 different residential zones for the 2020 assessments, officials said. That approach was less intensive and time-consuming than a full-scale mass appraisal. OPA announced in January that it was opting for the “trending” methodology to devote more time to other systemic improvements.
“Trending helps keep assessments closely tied to the market over limited periods of time,” OPA wrote in an explanation to property owners posted on its website.
Even though Sarah Maiellano has a 10-year tax abatement for new construction and pays tax only on her land, she is among the homeowners who received steep increases both of the last two years. Her property tax bill jumped 60 percent to $3,110 this year after her rowhouse on Rodman Street in Center City was reassessed. She appealed and her bill was lowered to $2,724.
“I’ve been dealing with this, it feels like, all winter and was feeling like we just finally got it settled,” she said.
But last week, Maiellano checked the city’s online records and learned that her assessment would rise in 2020 to a value even greater than the one she had appealed. Her new bill would be $3,158.
“I don’t look at this as a fair process at all,” she said. “I look at it as a money grab. … I feel like the city treats me like an ATM — they need money for something, they raise the property taxes.”
Philadelphia overhauled its system in 2014 when it began assessing properties at 100 percent of the market value — or the amount at which a home would sell on the open market. Under the so-called “Actual Value Initiative" (AVI), the city said every property in the city would be reassessed every year. The 2019 hikes in values for homeowners came in part, officials said, because OPA had not reassessed all residential properties in a few years.
For residents like Nisenfeld, the process is still confusing. Homeowners with mortgages have tax bills rolled into their monthly payments, and the city’s online property records show assessment numbers but do not indicate how to calculate the corresponding taxes.
Nisenfeld said some recent sales in her neighborhood are close to her new assessment — $214,700 — but she was surprised that sales prices have increased that much. And if taxes are increasing, she said, she wishes she received better city services and saw improvements in the schools.
“The average person doesn’t know what’s going on,” Nisenfeld said. “We just work, pay our bills, and find out the hard way that we’re being scammed out of more money.”
At last week’s budget hearing for OPA, Council members grilled assessment officials about upcoming improvements to their department, including the expected 2020 release of a years-delayed computer system known as CAMA that will be used for assessments. Council President Darrell L. Clarke, whose office is working on its own analysis of the 2020 assessments, said he planned to call OPA officials back to testify about the new values at another budget hearing. Chief Assessment Officer Michael Piper said his office will also work to post more information online about its assessment methods; OPA has failed to do so for several years, despite a city law requiring it.
Councilwoman Helen Gym said OPA must do more to restore public trust.
“We’ve had an enormous rift that occurred between our residents and your department," she told Piper at last week’s hearing, "and I think it’s our responsibility to try to figure out with your department to make sure this is a relationship that isn’t beyond repair.”
Staff writer John Duchneskie contributed to this article.