Assessments and Lawsuits

Assessments and Lawsuits

The recent lawsuit (see 8-22 Blog) challenging the reassessment of a Pittsburgh residence based on an appeal by the School district of the property’s assessment once again points to the ridiculous situations that occur when property assessments are not kept current by the County appraisers.

A Pittsburgh house assessed at $464,700 sold for $750,000. The Pittsburgh School District successfully appealed and got the assessment raised to $690,000, 92 percent of the sales price and the 2016 common level ratio.

Here we have governments needlessly fighting each other because of the obstinate refusal of them to keep assessments up to date. One can understand the home buyer’s angst over having the house’s taxable value being raised by $200,000. Combined school, city and county property taxes would go up by around $5,100 per year.

At the same time, the school district wants the revenue it believes it is due and other property owners whose properties are assessed close to market can feel justly put upon by a system that allows large expensive properties to pay far less than they should be paying.

And to make matters worse, the failure to keep property assessments up to date leads to appeals by taxing bodies (other than the County) that involve legal costs (paid for by the taxing body) and County assessment board time—which also costs the taxpayers. Then we have the furtherance of the unnecessary expenditures with the taxpayer hiring attorneys to sue the Board of Assessment Appeals and Review.

If property reassessment had been carried out in 2015 or 2016, this lawsuit with all the costs that the taxpayer and the County will incur through court costs and solicitor time, could have been avoided. Or in the worst case, the owner might have appealed the new County assessment as many property owners do after the reassessment. However, in the case at hand, it is unlikely an assessment of $690,000 would have been lowered.

But the owner would have a chance to make a case. A lawsuit would be unlikely, because there would not be any basis for the suit. It would be viewed as frivolous and tossed out by a judge. The house sold in an arm’s length transaction for $750,000 and the owner wants a decrease in the assessment from $690,000. Very unlikely to arouse any judicial sympathy.

And so it goes. On the grounds that the County is protecting homeowners against huge tax hikes, the County refuses to do its duty as required by the Constitution if not state law. Which, by the way, is another sad story. The sophistry and misleading arguments by the County Executive and his predecessor are poignant reminders of the silly and harmful things governments can get up to. Other counties are doing reassessments successfully without a lot of taxpayer angst. They are keeping people apprised of the fact that the taxing body is limited to a small percentage increase in revenue following a reassessment.

Only those properties that have been substantially under assessed will see large jumps in tax bills. Many will see bills go down and some will stay about the same or rise slightly. Once people understand the facts and ae not being bombarded by falsehoods and scare tactics, the reassessments can happen without major consternation.
What we see in Allegheny County, which had to be ordered by the Supreme Court to do the last reassessment, is not worthy of a government body charged with ensuring the fairest possible property tax system as required by the Constitution.