The County is putting the final touches on the reassessment of real property, the first one in a few years. It will go into effect on January 1, 2013, and the County, its municipalities, and its school districts will have to adjust their millage rates to adjust to the new values. That is all yet to come, but the question of "when do we do this again" has already come up.
Sounds a lot like Allegheny County, doesn’t it? It is not. In fact, it is the county tucked up in the far northwest corner of PA, Erie County. After spending many years not reassessing, the County lost a court battle and reassessed in 2003. After doing that one, Erie’s County Council passed an ordinance in 2005 that mandated reassessments every eight years, giving way to the one set to go into effect in seven months. That time frame is still longer that what the IAAO would recommend as best practices.
If 2005 rings a bell, it should. That was the year Allegheny County released new assessed values that were to go into effect in 2006. That would then lead to annual assessments after another three year breather. That was all scrapped and the base year plan was hatched. We have for several years been pondering what comes next for Allegheny County’s reassessments.
Of course, Erie’s question-and Allegheny’s, and all other counties’-could be answered if the General Assembly comes up with a mandatory schedule for assessments, crafts a statistical trigger, or eliminates property taxes altogether.
Nearly three years after the Supreme Court ruled Allegheny County’s base year plan to be in violation of the uniformity clause of the Pennsylvania Constitution comes the report of a Task Force on reassessments. This latest foray into looking at the state’s seemingly insoluble assessment problem was created pursuant to a resolution passed by the General Assembly in 2011.
“Out with the new, in with the old” seems an apt description of what transpired last week. In the latest twist in the never ending reassessment story, the new County Executive told the media that 2012 property assessments will be ignored and the County will instead certify the existing 2002 base year numbers for taxation purposes in 2012 and beyond-in defiance of court orders.
As is well known by now, Allegheny County mailed out its assessment notices to owners in the City of Pittsburgh and Mt. Oliver, beginning the process of its first reassessment since 2002. What may also be known, but has not gotten as much attention, is that Washington County is currently in Commonwealth Court over their planned reassessment; it has not reassessed since 1985.
The International Association of Assessing Officials (IAAO) has written "Although assessment trending can be effective for short periods, properties should be physically reviewed and individually reappraised every four to six years". It being 2012, how many counties would fit the IAAO standard? The State Equalization Board (STEB) houses all of the aggregate data on assessments across the Commonwealth and their table on the last reassessment date shows that six counties (Elk, Indiana, Montour, Northumberland, Union, and York) conducted a reassessment in 2006. Philadelphia is listed as "on going" and Allegheny County, as noted, has begun its mailing process. It is not clear what will come from Washington’s case.
What of the other counties? STEB data shows that:
•· 24 counties (not counting Allegheny’s 2002 date) reassessed between 2000 and 2005;
•· 21 counties reassessed between 1990 and 1999;
•· 5 counties (not counting Washington due to its court status) reassessed between 1980 and 1989;
- 8 counties reassessed prior to 1980
"Although assessment trending can be effective for short periods, properties should be physically reviewed and individually reappraised every four to six years"-International Association of Assessing Officials (IAAO) "Frequency of Reappraisals" from Standard on Mass Appraisal of Real Property, 2008
Sure the IAAO standards are not binding, but certainly could be treated as a best practice or an industry standard for the assessment of property. A reassessment every four to six years: that’s where Allegheny County was headed in the mid part of the past decade, before scrapping the plans to move from tri-annual assessments to annual assessments by 2009. We know what happened: the County tried a base year, it went through the state’s courts and Allegheny County is now within a year of revealing the 2012 reassessments. The current County Executive stated again publicly that he will continue to fight the court’s decision.
How many counties in PA fall outside of the IAAO standard? Again visiting the LBFC study mentioned in previous blogs, the data on the last effective date of County reassessment (a reassessment under state law is either a parcel-by-parcel revaluation or a change in the pre-determined ratio-for instance, valuing property at 75% of market value instead of 60% of market value) shows that seven counties have not done a reassessment since 1986. The counties of Beaver, Blair, Crawford, Forest, Huntington, Washington, and Westmoreland belong in that group, a decidedly central-to-western grouping in terms of geography. Another five did a reassessment somewhere between 1986 and 1989; another 15 in the decade that followed.
That means 41% of Pennsylvania counties have not taken a reassessment action since 2000.
The balance, 39 counties (59%) have taken a reassessment since 2000. Eight counties would fit the IAAO standard as of the report’s publication by meeting the four year window (doing a reassessment since 2006). Philadelphia assesses annually, and we know about Allegheny County; thus, PA’s two largest counties will have updated assessments as of next year.