Editorial: Corrupt to the core

Mayor Nutter's call for steep property-tax hikes in the middle of a deep recession was a bad idea from the start. But it's an even more outrageous proposal given how the city's property-tax system is so corrupt and broken.

A three-part series that concludes today in The Inquirer details how the city agency that decides property values - the Board of Revision of Taxes - is a hack-filled, political cesspool that's unfit to oversee a $1 billion operation that impacts every property owner in Philadelphia.

The series reveals how the BRT operates as a jobs bank for washed-up political flunkies and insiders. The agency hasn't assessed some properties for 20 years, while deals get cut for the well-connected to pay less.

The board operates in secret in direct violation of state law, while agency records lack documentation as to how its decisions are reached.

Even BRT officials told Inquirer reporters Mark Fazlollah and Joseph Tanfani that the agency's assessments are flawed and that some property values have probably been rigged.

"The system is fundamentally broken," said BRT board member Russell Nigro, a former state Supreme Court justice.

Given that the BRT's tax-assessing system is such a farce, Nutter is hard-pressed to argue in good faith for huge property-tax increases. Nutter, who was elected as a reform mayor, wants to raise property taxes by a hefty 19 percent this year and 14.5 percent above current levels in fiscal 2010. He needs to scrap that plan and find more cuts in the budget.

Trying to raise taxes on a system that is so blatantly unfair and corrupt clearly violates the spirit of good government. Not to mention, The Inquirer series raises questions about the legality of some BRT actions.

Homeowners shouldn't be required to pay higher taxes to cover the city's bureaucratic waste and incompetence. Taxpayers should contact City Council and the mayor to voice their opposition to tax hikes, which are almost unanimously deplored, according to a recent poll.

As the mayor pushes for tax increases, he also wants to overhaul the flawed property-tax assessment system. This is a worthy idea, but it is also a major undertaking that could wreak havoc on the city's housing and commercial development markets. Nutter could set off a tax revolt. The city clearly needs to get any new assessment system right.

Last week, the BRT completed work on a tentative plan to change the way properties are assessed. The plan replaces the BRT's convoluted system with one designed to reflect the real value of properties. Millage rates would need to be reduced, too.

The intent is a good one. But the very idea that the BRT is overseeing the reform leaves zero faith it will be done in a fair and professional manner, free of political influence. After all, the BRT's modus operandi is entrenched in a Tammany Hall-era mentality.

The BRT worked on the new system - called the Actual Value Initiative - for five years. Then, independent experts were called in last year. But the outside experts worked only on residential properties. Control of commercial properties was left to the hacks at the BRT, suggesting more favors for big political donors.

Fortunately, a majority of Council opposes Nutter's property-tax hikes. The mayor needs to back off his plan, cut more spending, and lead the effort for comprehensive tax reform that can be trusted.