Several years after I purchased a home in Philadelphia, a tax assessor showed up at my door. After we chatted about whether I had made any improvements to the property, the lovely man disclosed that we were related and offered to freeze my tax bill. This was my introduction to Philadelphia’s property-tax system.
A lot has changed since. I get better city services now than in the late 1980s. Once a week, a recycling truck lumbers up the street; potholes are filled; the city helps my neighbors plant trees. And here’s the kicker: When it snows, a plow shows up.
Yet the pace of improvement in the schools hasn’t been nearly as fast. As a result, over the last two decades, only one family with children has moved onto my block. And although some young families did move into the surrounding neighborhood, I watched “For Sale” signs appear in their yards as their children approached school age. That worries me.
Where do these families go? To Cheltenham, Elkins Park, Lower Merion, South Jersey, and other places where they willingly pay higher taxes for schools with smaller class sizes, electives, art, music, sports, and more.
A few years ago, researchers at Temple surveyed 3,000 homeowners in Philadelphia and the suburbs about how they decided where to live. The study included adults of all ages and income levels who had bought a home over the past decade. After real estate prices, they cited schools as the most important factor in their decision.
Much to the researchers’ surprise, taxes weren’t even in the top 10. In fact, 76 percent of Philadelphians and 62 percent of suburban residents either agreed or strongly agreed that they would be willing to pay higher taxes to improve local public schools.
Can’t compete
The study suggests that I’m right to worry about my neighborhood: Inferior schools, not taxes, are driving middle-income homeowners out of Philadelphia. And without the taxes these residents could pay – and are paying in the suburbs – the city’s schools lack the means to educate students.
How can Philadelphia compete with Cheltenham, which spent 40 percent more per student than the city did in 2008-09, or Collingswood (25 percent more), or Lower Merion (47 percent)? We can’t.
After Chester’s, Philadelphia’s property taxes are the lowest in the region. If I lived in Cheltenham or Elkins Park, I’d be paying more than twice as much in taxes on a comparable home. Talk to anyone living in Montgomery County or South Jersey, and they’ll tell you Philadelphians who whine about their property taxes are being ridiculous. Some city properties have been under-assessed for many years, so some homeowners have avoided paying their fair share to maintain neighborhoods, keep libraries open, and educate the next generation.
Philadelphia’s low property taxes have long been a sore point for legislators representing other parts of the state. Right or wrong, many of them refuse to appropriate more money to the School District of Philadelphia unless the city’s residents start paying more in taxes.
Still reeling
Now City Council has an opportunity to fix the tax system, pump needed resources into the schools, and begin to reverse our historic pattern of weak local support for education.
Several years ago, Council voted to move forward with the Actual Value Initiative to reassess every property in the city using a more transparent, professional system. The reassessment is expected to be complete in early fall.
Meanwhile, the city’s schools, still reeling from cuts in state funding, are bracing for more losses in next year’s budget. Mayor Nutter has proposed raising an additional $90 million for the district next year through property taxes. He is asking that the rate at which residents pay taxes on assessed value be set at a level that generates that additional revenue once reassessments are complete.
After the reassessment, most of us will end up paying 1 to 1.5 percent of the assessed value of our homes in taxes. For some, this will result in a lower tax bill; others will see a higher one. Any significant increases are to be phased in over three years to help homeowners avoid being hit suddenly with large, unanticipated expenses. Anyone who lives in an owner-occupied home will receive a $15,000 exemption, and low-income senior citizens will be able to freeze their rates at current levels.
Some people will always complain about tax increases, even if they aren’t directly affected by them. But critics of the proposed tax increase are failing to acknowledge that the fate of the city hinges on our ability to improve the quality of its schools. A new School Reform Commission and superintendent, even with committed teachers, administrators, and parents, cannot run the schools with good ideas alone. Funding plays an indisputable role in educational quality.
City Council can strengthen our city by investing in our schools. It should approve the Actual Value Initiative and the increase in school funding.
Christie Balka is director of advocacy for Public Citizens for Children and Youth in Philadelphia. She can be reached at cbalka@childrenfirstpa.org.
Philadelphia Inquirer – March 30, 2012 – Read article online