After a highly successful tax amnesty program in 2010 and reorganization efforts in the Sheriff's Office, Philadelphia has been ramping up its property-tax collection efforts, doubling the number of delinquent properties taken to sheriff's sale and collecting far more tax revenue without resorting to the expensive tax-sale process.
The City Revenue Department and its two cocounsel collection firms have been strategic and tough. We call and send targeted mail to tax delinquents, telling them that they must pay in full or sign payment agreements. If not, we take them to court.
With three months left in the fiscal year, the Revenue Department has collected $7 million in delinquent taxes. In all of fiscal 2010, we collected just $3.9 million.
Some critics have noted that we said we'd take 600 properties to sheriff's sale each month and that we're only a third of the way there. There are good reasons why we haven't hit that stretch goal: Taxpayers are doing what they should have all along. To avoid sheriff's sale, they are paying us in full or setting up payment agreements. And compliance rates from our increased monthly tax-sale filings are much higher than expected.
The goal is not to sell properties. We want property owners to pay their taxes and water bills, and that's what many are now doing, which in turn is why 600 properties have not been sent to sheriff's sale.
Supplementing Revenue's efforts are our two cocounsel agencies, Linebarger Goggan Blair & Sampson and Goehring, Rutter & Boehm.
Tax-sale listings by Linebarger have increased from an average of 50 new properties a month before the amnesty program to about 150 a month. Its average monthly collections have increased from $700,000 to slightly more than $1 million. Linebarger has been promised an additional $1.2 million from about 360 payment agreements.
Since it began filing tax-sale petitions in September, GRB has collected roughly $900,000 in lump-sum payments from taxpayers and about $1.3 million from payment agreements. It has been promised an additional $3.6 million under 430 more payment agreements.
For the first time, the Revenue Department sent notices in the fall to 12,700 taxpayers who did not pay their 2011 real estate taxes on time. They were warned that failure to pay by Dec. 31 would make them delinquent, meaning the city could seek a lien against their property, pursue tax-sale proceedings more quickly, and publicize delinquency in the newspapers. About a third of the taxpayers notified paid by Dec. 31. We will continue this aggressive, proactive stance, bringing in much-needed revenue in a more timely manner and decreasing the caseload for future sheriff's sales.
The department is continually working to enhance our current collection processes and compliance initiatives, and it's paying off for the city. Overall delinquent collections are up $11.1 million compared with last fiscal year and $30 million from two years ago.