Penn Hills Will Test Assessment Law

Penn Hills Will Test Assessment Law

A newspaper article this morning indicated that Penn Hills-the second largest municipality in Allegheny County-plans to pass a 0.5 mill increase in its property tax rate for the 2012 fiscal year. According to the Treasurer’s website, Penn Hills’ millage is currently 5.35 mills. Raising it 0.5 to 5.85 mills would constitute a 9% boost in the millage rate.

From another article, this one about the new assessment mailings that will go out to Pittsburgh and Mt. Oliver (the two communities that make up the Pittsburgh Public School District) on December 19th: "State law provides two protections for property owners following a reassessment. An anti-windfall provision requires municipalities to readjust their millage rates to reflect changes in overall property values. The hoped-for result will be to keep the total amount collected through real estate taxes before and after reassessment ‘revenue neutral.’ Elected officials, however, can vote separately to raise tax collections by up to 5 percent following reassessment. Amounts higher than 5 percent would have to be approved by a judge."

The state law in question is Act 71 of 2005, which is going to get a lot of attention in the coming weeks and months as the assessment moves forward. This is especially true of County Council’s planned 1 mill increase (21%). Previously Allegheny County and taxing bodies in the County could take 105% of the previous year’s revenue through a reassessment windfall. Now that percentage would have to be arrived at in a two step process. Anything above that requires court approval.