JUST WHEN WE had finally managed to avoid thinking about the giant headache of overhauling the city's property-tax system, Pew's Philadelphia Initiative issued a report last week that dragged us back to reality.
As you may recall, City Council and the Nutter administration spent months earlier this year not passing Actual Value Initiative. AVI would reassess every property in the city and start taxing that property at its full value. Council debated the issue as much as it could in the absence of the actual reassessment numbers, which the Nutter administration had promised and then didn't deliver on. So on the brink of a fix that has been in the making for at least a decade, AVI was tabled.
It's supposed to come back in time for Council's next budget-making. Which isn't that far off, since the new year is just a month away.
The Pew report is an attempt to study the challenges the city faces in making this long-overdue reform. We hope the fact that these are now laid out in black and white doesn't give city leaders a new case of cold feet on completing AVI. The report points out that few cities have actually done massive reassessments of all properties and changed the way those properties are taxed at the same time.
The report does raise two flags that are worth examining further. One is the difficulty created by the uniformity clause - that clause in the state Constitution that mandates that "all taxes be uniform, upon the same class of subjects." The clause prohibits the city from treating residential, industrial and commercial property differently when it comes to establishing tax rates.
In fact, last year the Pennsyvlania Bar Association's Constitutional Review Committee recommended amending the Constitution to allow for the classification of real estate within the clause so different types of properties could be taxed differently. The state could also help by requiring reassessments be done more frequently; the Pew Report points out how lax the state is in its oversight of the reassessment process.
The second flag is an important caution: The city's reassessment of every property has taken a long and winding road, and we still haven't seen the new values. But in order for AVI to work, those reassassements are going to have to get done every year and executed flawlessly. That's going to require that the Office of Property Assessment is funded enough to get the job done. Otherwise, we'll have gone through the pain of reform for nothing.
SPEAKING OF REFORM, the timing of the report had a sad echo in the announcement last week of the death of former City Councilman Ed Schwartz. Schwartz served as the head of the city's Tax Reform Commission, established in 2003, which issued an in-depth analysis of the city's tax codes, and recommended changes.