Many Philadelphia property owners will see higher real estate tax bills next year despite the new city budget containing no tax rate increases. That’s because the city is resuming property reassessments, which were paused in the final year of Mayor Jim Kenney’s administration. The new valuations will capture two years of growth and are likely to increase steeply in neighborhoods with strong real estate markets. The Office of Property Assessment was supposed to have published the new assessments by the time first-year Mayor Cherelle L. Parker and city council reached a budget deal. Instead, lawmakers gave preliminary approval to the budget based on estimates for the real estate tax, which is levied at 1.3998% of a property’s assessed value. The new valuations will be available by the end of the month, city finance director Rob Dubow said. Those values will be used to calculate property tax bills due by March 31. Parker’s administration in March estimated that revenue from residential properties will increase 8% while staying flat for commercial properties, due in part to uncertain valuations for office buildings amid the work-from-home era. That would produce $877 million in revenue during the budget year that begins July 1. It’s possible valuations will come in even higher, as the city bases assessments on the amount for which a home could sell. To help offset tax increases for homeowners, Parker and council agreed to approve two new property tax relief options for homeowners: an expanded homestead exemption, and the option for low-income homeowners to freeze their tax bills.
Source: Philadelphia Inquirer; 6/7/2024