Pondering the value of the Actual Value Initiative

AS WE CONSIDER the Actual Value Initiative proposed by Mayor Nutter's administration, we should proceed with caution.

For years, most of us probably didn't even see the value of our homes as a dilemma at all. After all, Philadelphia was a city tucked away between Washington and New York City. I can't tell you how often I was asked in my travels why I loved my city so much. People just couldn't understand it.

However, the last 20 years' development has engulfed us, companies have wanted to be here and we are fast becoming a destination city.

Here is one example of why we need to take a long, hard look at equity and fairness in property-tax assessments. According to the Philadelphia Forward website, two homes sold in 2007, at poles apart: "A house in Southwest Center City at 23XX St. Albans Street sold for $480,000; a Northeast Philadelphia house at 33XX Holme Avenue sold for $88,500 . . . the home that sold for $88,500 has a $1,494 tax bill while the home that sold for $480,000 only pays $1,311."

Something is definitely wrong with this picture. Bottom line is, real-estate taxation in Philadelphia can be mind-boggling, especially if you're a person living in a neighborhood that is undergoing incredible growth.

If the AVI . . . is to move forward, then it makes total sense for us to develop a property-tax system that benefits our schools, government services and the city as a whole.

The 2nd Councilmanic District is very diverse. And, obviously, I'm very sensitive to the needs of my constituents. The residential areas range from low- and moderate-income housing to posh condos. I'm talking about parts of Center City, Point Breeze, Packer Park, Grays Ferry, Hawthorne and Eastwick. So, clearly, the assessing of property at full value will affect the district in different ways.

My office is flooded with calls from nervous residents who are unsure how fixing the system will affect their tax bills. Here's my issue: I have no desire to rush a fix through City Council that could harm my constituents. We must be thoughtful so that we can be sure to avoid creating a process that will punish those who have been paying their taxes as responsible citizens.

Some property owners have been paying real-estate taxes based on a high percentage of the value of their properties, while others have been paying taxes based on a small percentage of the values. We need to really understand the real property of the homeowners.

It's important that we create buffers for a smooth transition. This problem was decades in the making, so we should phase in new tax bills over time or allow homeowners to defer a certain amount of any increase, so that residents do not see any unreasonable spikes in their tax bills.

We must consider legislation, like the Homestead Exemption bill (SB 1301), which state Sen. Hardy Williams just passed out of the Senate and is now in the House. It will authorize the city to provide property-tax relief for residents and seniors.

We must balance the need for revenue with the budgets and income of residents or we may end up chasing some out of the city.

In closing, I will have a watchful eye as the process develops. I am totally committed to working with Mayor Nutter, my fellow members of City Council, and residents of the neighborhoods of the 2nd District for all of us to get this right.