For the umpteenth time the County Council President has labeled the property assessment system as flawed while arguing the assessments in place currently should be unchanged. How’s that for consistent logic? If the Councilman is convinced that assessments can never be done accurately, then he is saying the current values probably contain many huge errors-something the lawsuit against the County demonstrated conclusively to the judges leading to court orders to re-assess. How then can he, in good conscience, be part of a government that imposes and collects taxes knowing the inequities in the assessments?
As part of County government that levies taxes on property purportedly based on its market value, the Councilman has a moral and ethical responsibility to ensure that values used to determine the amount of tax owed are as accurate as possible. Defending known gross errors in assessed values and fighting to keep them in place is a dereliction of duty of the highest order.
By going further and spreading the false premise that everyone’s taxes will rise after a re-assessment and claiming that tax bills are being held down by keeping the existing known flawed assessments in place is the height of fatuous political rhetoric. As such it reveals a stunning absence commitment to the principles of good governance and disrespect of basic rights of citizens.
If this is the attitude of people sworn to uphold the law in Allegheny County, which includes obeying judges’ rulings, it would be entirely appropriate for the state to remove the property assessment responsibility from the County or alternatively disallow the power of governments in the county to levy property taxes.
An Allegheny County Council Committee has voted to instruct the Solicitor to file suit against the state Legislature in an effort to force it to rewrite Pennsylvania’s property assessment laws. It would have been wonderful if the Council had spent the time and effort trying to get up-to-date accurate assessments of properties they have spent trying to avoid doing the right thing and making ridiculous claims about the unfairness of being forced to do the right thing.
The Allegheny Institute has written for many years about the need for the Legislature to reform the state laws governing assessments. Such reform would include mandatory assessments at least every 3 to 5 years, state verification of sales price data, uniformity of assessment standards and state training for assessors.
Where was the Council when these straightforward and common sense recommendations were being offered on multiple occasions? They were busy concocting and defending assessment schemes that perpetuated well documented inequities. Now that the Supreme Court says do the re-assessment and has suggested the state reform assessment legislation to bring it into the 20th century, the Council wants to get on board and appear to be doing something to protect those who have benefitted from under assessments all these years. Cynics might conclude a political motivation is behind this latest move by Council.
Council chair keeps telling us what a competitive disaster a re-assessment will be. What about the disaster that happens every year when tax bills go out and over assessed and correctly assessed owners are forced to pay more so the under assessed can pay less than their fair share? And how has the County’s scheme protected against school and municipal tax rate hikes? In short, it hasn’t. Many schools and municipalities have been boosting their tax rates during the County’s base year freeze. The County avoided a tax hike only through being granted the drink and car rental tax. So much for worrying about the taxpayers as the Council and Executive incessantly claim to be doing. What a scam!
We have just witnessed the County Council President, who is sworn to obey and defend the Pennsylvania Constitution, call for the Legislature and Governor to overturn a Supreme Court ruling. And not even on the grounds that the Supreme Court ruling is unconstitutional but on the grounds that Allegheny County is being negatively impacted by the ruling-while presenting no evidence that the County is being harmed.
Such a capricious legislative overturning of a Supreme Court ruling would throw the state into a constitutional crisis. If allowed to stand this precedent would undermine and possibly destroy any semblance of a separation and balance of governmental powers with terrible consequences for the Commonwealth.
What is the Council President seeking to have overturned? He is seeking the overturn of the Court decision requiring Allegheny County to reassess properties because of the enormous inequities and errors in current valuations.
After fighting reassessment for six years through one delaying tactic after another, the Council President is obviously heavily invested in maintaining the status quo. But that battle has been fought and lost in several court rulings dating back to 2006. He now claims that reassessments will lead to a less competitive environment in Allegheny County. On what does he base such an argument? That taxes will rise? They are already rising in many County municipalities and school districts despite the assessment freeze in place. These tax rate increases are simply exacerbating the effect of the assessment inequities currently in place. What’s worse, the inequities have widened over time as market forces lead to sales prices and volume that reward the under assessed and punish accurately and over assessed properties.
Tax rates in school districts in surrounding counties have also risen despite their base year property assessment systems. The Councilman seems to have trouble with the reality that it is government expenditure increases driving tax hikes.
The local court has ruled against the County’s unfair assessments for years. The Supreme Court concurred and ordered a reassessment. The Supreme Court in its ruling left the door open for property owners in all counties to sue their county governments if they believe its base year assessment is creating serious inequities. Allegheny County has not been singled out by the Court. It was the county being sued in the case that was before them. The Court decision has opened the door to a viable remedy for other counties if property owners feel sufficiently aggrieved to take the county to court over the assessment system.
By asking the Governor and Legislature to overturn the Supreme Court ruling the Councilman has proposed yet another action in a long running series of Council actions that flout the Constitution and laws of the state of Pennsylvania as well Common Pleas Court decisions.
If the efforts of one member of County Council is directed toward eliminating "sticker shock" from new assessed values that will go into effect in January of 2012 through a homeowner "bill of rights", it should be known that the window of opportunity for minimizing the impact of new assessments was lost when the County opted to toss out the planned values for 2006 and adopted a base year plan that used 2002 values.
For those who recall the recent history of Allegheny County reassessments, a history that we documented in pieces over the last few years, the County released new assessment numbers in early 2005 so that taxpayers could absorb their value, have a year to appeal, and have values in place for 2006 for taxation purposes. That would then be followed by annual reassessments in 2009 and years thereafter, thus minimizing the shock taxpayers would undergo when they received a mailing from the County’s Office of Property Assessments.
Those 2005 numbers were described as "uniform and accurate" by the County’s chief assessment officer but were tossed out in favor of other schemes before the County settled on the base year plan, a plan that was later overturned by the PA Supreme Court.
Now with the legal matters settled and the coming year revealing the results of the reassessment, the Council member proposes a variety of fixes for the assessments. Some the County could do (raise the homestead exclusion, assign County employees for on-site verification of property value disputes) while others seem questionable and could put the County in a familiar place, namely the courts of law (phasing in the impact of large increases over several years, compelling payments from municipalities and school districts on appeals of properties). Not mentioned in the "bill of rights" is the fact that the County could commit to a revenue neutral windfall after the reassessment, even though it is permitted to take 105%.
With all the machinations the County has attempted to circumvent its duty in assessing real property, isn’t it time to simply follow through with the process? After all, those that have been greatly underassessed have for many years paid far less than their fair share of taxes, forcing those who are correctly assessed or over assessed to pay higher taxes than they should have paid. When does that subsidy end?
Last night, at a meeting with County Council, the Chief Executive said "I will do everything in my power to make sure [a 2012 reassessment for Allegheny County] does not happen".
That’s quite different from what he said in an official County press release dated December 4, 2009: "Allegheny County will comply with the court-ordered 2012 reassessment…"
So what accounts for the shift in thinking? It is anyone’s guess at this point. Perhaps more important is exactly how the Executive plans to stop the reassessment from going forward. A bill he favored that would allow for a moratorium on reassessments continues to languish in the General Assembly, and for good reason-that bill would create a Constitutional crisis by having one branch of government telling counties to ignore a unanimous Supreme Court decision.
Maybe he wants to study the issue to death, and this is another idea that ought to be nipped in the bud. The Court of Common Pleas provided a comprehensive picture of assessment practices, as did the Allegheny Institute, and the Supreme Court decision even noted that "twenty two of our sister states require annual reassessments, while twenty six permit reassessments to be conducted at intervals over one year, though they still require periodic reassessment". If the Executive is trying to find another state that allows for indefinite base year assessments, he is not going to find evidence to bolster his case.
What is the Executive’s plan for reassessments then? To keep the courts out of assessments completely, even if questions over uniformity arise? A zero windfall in order to prevent the "back door" tax increases that he abhors? A shift to income or sales taxes in order to end property taxes for schools, cities, and counties? How would he treat counties where a reassessment occurs by an affirmative vote of elected county officials as opposed to a court ordered reassessment?
So many questions arise from this never ending quest to prevent what the highest court in the Commonwealth said needs to be done.
How else could the situation surrounding Allegheny County’s reassessment be described? We are long past "will they or won’t they". Just yesterday the court found out that the County has engaged in even more foot-dragging on his reassessment order: the chief assessment officer of the County hasn’t even read Judge Wettick’s order, written on November 10th. That same assessment officer said that he was told by his boss, the head of the Administrative Services, to ignore the plan. Upon further questioning, the department head told the Judge that he was advised by the Law Department.
That would be the same Law Department headed by the County Solicitor who told the Judge in October that "whatever the Court tells us to do, we will do". Empty words indeed, notwithstanding the fact that the County had already announced they would appeal the plan to Commonwealth Court.
So what’s next? The Judge has to do something-his order, though flawed, comes from a Supreme Court decision in April saying that the County’s base year violated the uniformity clause of the Constitution. Maybe the Judge can suspend any requirement for taxpayers to pay real estate taxes until the County commits to fixing the assessments and their solution is certified to meet acceptable standards. There has already been significant damage done to the public’s confidence in the rule of law.
The principal effect of the moratorium on re-assessments now working its way through the Senate after having passed in the House will be to set aside an important constitutional provision known as the Uniformity Clause. By ordering a stop to court ordered re-assessments until some future unknown date, the Legislature will overturn a Supreme Court ruling that the base year as used in Allegheny County is unconstitutional. Thus, the legislation as written effectively amends the constitution statutorily rather than through the prescribed amendment process contained in the constitution.
Another consequence of the legislation will be to deprive property owners from suing a county wherein a property is located and taxes are paid on the grounds that the assessment system violates the Uniformity Clause. That amounts to legislative denial of due process.
Of course, this should be enough to give the Legislature pause before it proceeds, but it apparently won’t.
The Legislature says it wants the moratorium so that it can reform the state’s assessment regulations. The problem is the Legislature has no credibility on this point. They have had decades to fix the problem and have done nothing until forced by a Supreme Court ruling, which they now want to overturn. Here’s the crux of the situation. Any legislative reform of assessments will have to call for a re-assessment in counties that are far out of line on measurements of accuracy of assessments in order to satisfy the Uniformity Clause requirement and move the state into the 20th century vis-à-vis assessment.
The irony is that the Legislature is asking for time to write a bill that mandates re-assessments. They will meet the same resistance from folks afraid of a re-assessment and who are now screaming at them to stop court ordered re-assessments. Of course, the wink-wink, nod-nod understanding is that no legislation requiring re-assessments will be forthcoming any time soon. Thus, the state will continue with a constitutional crisis and ever worsening assessment inequities that are effectively locked in place.
The Pennsylvania House of Representatives passed a moratorium on court-ordered property reassessments until the matter can be studied further. This moratorium would not apply to counties going through voluntary reassessments and it would be optional for those counties going through court-ordered reassessments. Interestingly enough this legislation seems to primarily benefit Allegheny County and its Chief Executive who just lost a State Supreme Court Ruling regarding his property reassessment scheme. While this piece of legislation is unlikely to make it through the Senate, it serves as an illustration of politics trumping good governance.
The moratorium would expire on June 30, 2011 or until the study is complete, whichever comes first. Interestingly enough this date delays any decisions from being made until after the Gubernatorial election in 2010, for which Allegheny County’s Chief Executive is considering a run. Of course he once used anger over property assessments to propel himself into the County Executive’s seat and will do anything he can to make sure this same anger doesn’t derail his aspirations for the Governor’s chair.
But the Supreme Court ruled that a base-year assessment system is unconstitutional as used in Allegheny County which locks in inequities as properties in growing neighborhoods, over time, become under assessed while those in declining neighborhoods become over assessed. While the Court suggested the General Assembly take up the issue of base year assessments, this recent legislation from the House is not what they had in mind. Obviously members of the House are also afraid of voter outrage as the roll call shows only one vote against and 196 in favor. Instead of tackling the issue head-on, they have decided to play politics. The property owners of Pennsylvania deserve better.