It should be the most closely watched public policy lawsuit in Allegheny County in many years. Whether it is or not remains to be seen. But this controversy, one that easily could have been avoided, instead was left to stew, fester and brew by nonfeasant government.
The lawsuit, filed in late June, accuses the county of being either “grossly negligent” or “intentionally dishonest” in how it codes property sales submitted to the state for the purpose of establishing respective property taxes.
As the Post-Gazette reports it:
“At issue … is what is known as the common level ratio, a state calculation used in property assessment appeals to account for widening disparities between assessed values and current sales prices since the last countywide reassessment took place nearly a decade ago.”
The CLR, as it is known, is calculated by the state tax equalization board and is used in appeal hearings to determine the new assessed value of a property.
“To calculate the ratio, the state uses property sales, coded as valid, that are submitted by the county, according to the lawsuit — and that is where the problem occurs, the complaint alleges,” the P-G says.
The lawsuit claims the county is manipulating sales data submitted to the state, targeting those transactions where the assessed value is closer to the sales price but excluding those where there are larger disparities between the two.
“That, the lawsuit contends, has the effect of keeping the common level ratio higher than it should be,” the newspaper reports.
Or, in the lawsuit’s words:
“This results in the county, the school district, and municipal governments receiving increased revenues from the artificially overstated assessments of the appealed properties without increasing millage.”
But, and as noted at the outset, this lawsuit could have been avoided had Allegheny County conducted reassessments on a regular and predictable basis.
The last countywide reassessment – again, nearly a decade ago – was forced by legal action. Since then, county officials have engaged in a series of political machinations to avoid any reassessment, regular or otherwise.
Now, their nonfeasance has come home to roost.
In addition to demanding that the common level ratio calculations be done properly, the lawsuit asks that Allegheny County’s administrative code be followed in employing a qualified chief assessment officer to resubmit sales data to the state properly and, among other things, “reform its real property assessing practices that causes property owners who recently purchase property to pay more than their fair share of real estate taxes.”
And as the Allegheny Institute has argued for decades, real property tax assessment reform can only begin with regular reassessments, preferably at three-year intervals.
Anything less and this dog and pony show never will end.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
