A new study from Pew Charitable Trusts shows that—surprise!—the city’s tax burden will shift away from businesses and to residential property owners under the new AVI assessements.
Report author Emily Dowdall said all Philadelphia homeowners will be paying $72 million more in property taxes next fiscal year than in 2013, if Mayor Michael Nutter’s administration keeps its pledge to raise the same amount of revenue from property taxes under the new assessments.
At the same time, owners of commercial properties, including Center City offices, will be paying $55 million less. And owners of residential properties that have 10-year tax abatements will be paying $3 million less.
“So even though the city’s raising the same amount of money, and therefore it can be termed ‘revenue-neutral,'” Dowdall said, “depending on what kind of property you own, it will not be effectively revenue-neutral.”
CBS Philly adds, though, that the city’s residential property assessments were far more out-of-date than commercial properties when the AVI assessments were done.
The author of the report, Emily Dowdall of The Pew’s Philadelphia Research Initiative, attributes the shift to the fact that residential property assessments were more out of date, prior to AVI, “And at the same time, commercial and industrial properties were over assessed relative to the citywide average. So now, after AVI, residential properties — as well as another group, stores that have dwellings — will account for a greater share of the city’s total property value, and therefore the property tax burden as well.”
Relief for homeowners is being considered at Council, but Dowd added that even with the re-assessment, Philly residential property owners will still pay less in taxes than similar homehowners in cities like Pittsburgh and Baltimore.