McCullough Wants Time Out on Reassessment

Allegheny County Councilman Chuck McCullough is calling for a time out on reassessment because of ill communication over the implementation of 2010 reassessment between Council members and County Solicitor and Executive.

McCullough, along with other Council members, Matt Drozd, Vince Gastgeb, and Jan Rea all say that they were unaware or not involved of the court order for the 2012 assessment and do not believe that there was money in the 2010 budget to do the reassessment work.

"I challenge anybody to go through the 2010 budgets, which we already approved three days before, and find anything about property reassessments," McCullough says.

McCullough says that Council should have been consulted.

"We're going to ask the court to call a time out on this. We had a lot of problems eight years ago when we did a reassessment, he had a lot of problems nine years ago when we did a reassessment. We can't afford another round of disaster here."

This afternoon, the four members of Council are going to asked County Pleas Judge Stanton Wettick for a "time out" on reassessments until they can better understand the issue, and McCullough says that if they are denied a time out he might appeal.

Call for Change from Equalization Board

Pennsylvania State Auditor General, Jack Wagner, said that his auditors found significant flaws from the State Tax Equalization Board's revised property market values for 2008.

The State Tax Equalization Board (STEB) was formed to balance disparities in county property market assessments. Because counties reassess market values themselves, some not since 1986, STEB yearly calculates county market values. Those values are then used by the Department of Education and other state agencies to distribute over nine billion dollars in aid.

Auditors reviewed records from a sample 70 municipalities using the same information and resources STEB has access to and found a 65% error rate. Among the errors were 21 municipalities were credited with sales of properties that did not exist, and market value calculations for 15 municipalities used incorrect property sales ratios.

Wagner says that because of human error combined with a flawed computer system county property market values increased in some cases, leading to increased taxes in some municipalities. Because school districts rely on the funding that comes from STEB reviews, if property values increase funding to districts decreases. This could cause municipalities to raise taxes to make up for the loss.

Wagner says that even though STEB tried to fix the problems that occurred in 2008 and attempted to revamp the computer system, he believes that not all of the mistakes were solved. "I also call on STEB to immediately, and I repeat immediately, implement all of the recommendations contained in our audit. If they don't, STEB should be abolished and its responsibilities should be given to another state agency, such as the Department of Revenue."

STEB will install a new system in June of 2011, but Wagner says that they still need to go back to redo the 2008 and other reports because it effects the calculations for future reports.

Fitzgerald Wants End to Court-Ordered Reassessments

Allegheny County Council President Rich Fitzgerald will introduce a resolution at this evening's session that calls on newly inaugurated Governor Tom Corbett and the Pennsylvania legislature to pass a bill declaring a moratorium on court-ordered reassessments.
Allegheny County is under a court order to end its 2003 base year assessment process and completely reassess some 550,000 properties in the county. Supporters of the base year process, including County Executive Dan Onorato, say the court order puts Allegheny County at a competitive disadvantage with other counties in the region which have not done reassessment in years...in some cases, decades.
Last year, by a vote of 196-1, the Pennsylvania House approved a bill that would have the state study the assessment system for a year and develop a statewide assessment system. During the course of the study, counties would be immune from court-ordered reassessments.
However, the Senate did not take up the measure before the legislative session ended.

"This court-ordered reassessment singles out the residents and businesses of Allegheny County, and will have a profound chilling effect on private home construction and renovation as well as economic development and business growth within the county," said Fitzgerald.

The council president says Pennsylvania is the only state in the country that doesn't have a statewide system of property assessment and that is now resulting in "one county (Allegheny) being targeted for disparate treatment. But this is an issue that, sooner or later, will affect every county in the Commonwealth."

Fitzgerald urged the General Assembly to pass the moratorium and create a uniform solution "rather than have a separate solution for each county imposed upon it by court action."
The bill will make reassessment a state responsibility and prevent property taxes from dramatically rising.

Councilman Says City Property Taxes Unequal

Pittsburgh Councilman Ricky Burgess says a survey of more than 11,000 home sales between 2006 and 2010 indicates properties in many of the city's poorer neighborhoods are assessed for more than their fair market value. His survey shows in wealthier neighborhoods, such as Squirrel Hill, some homes are assessed well below their market price. He said property reassessment will help the problem of homeowners in poorer neighborhoods who pay more than their fair share of real estate taxes while sometimes receiving less services than people in more affluent communities.

Burgess says there are "two Pittsburghs," a result of raised property taxes. This has been an ongoing problem, he said, because the housing market is fluid. The last assessment was done in 2003. In seven years, there has been a difference in the prices homes are sold at. "Those differences are not accounted for in our current system. So houses that have appreciated in value significantly over the last seven years are still assessed at their very low value while houses that have depreciated in the last seven years have their higher accessed value. The accessed value is not consistent with what the true market value of what those homes are," he said.

He proposed a change in the city charter that would require all future property tax increases to be approved by voters. Council will discuss that legislation Wednesday. If passed by Council and the Mayor it would be on the ballot for the May primary election.

Bills Would Create Spot Assessment Procedure

A bipartisan quartet of state lawmakers has proposed legislation that would shed more light on the practice of school districts spot assessing properties. School districts across the state have tried to raise property tax income by appealing assessments of individual homes after those properties sell for more than their assessed value. State Representative Tim Seip says that practice runs afoul of the state’s uniformity clause because one home on a given street may be assed using a 2009 value while another could have a value set 10, 20 or more years ago. Seip tried to have the practice outlawed last year but the governor twice vetoed the bill. Seip, two other state representatives and a state senator have introduced what Seip calls compromise legislation. Rather than outlawing the practice, it will force school districts to give a homeowner 30-days notice of an appeal and then force the school board to approve the appeal in open session. Seip says he hopes that will give property owners a chance to go before the school board and hold the board more accountable for their actions. Seip says too often school boards are delegating their taxing responsibility to non-elected solicitors and in some cases do not even know what is going on with the spot appeals. The three house bills creating the changes in different class counties were voted out of committee this week and a bill addressing all counties in the senate has not yet come up for a vote. The governor’s office has indicated the Governor Ed Rendell will sign the legislation if it is passed. Seip says he will continue to fight to outlaw the practice when a new governor is put in office.

Property Reassessment Agreement Reached

Allegheny County officials, lawyers representing property owners and Common Pleas Court Judge R. Stanton Wettick reached an agreement this morning to reassess all 575,000 privately owned properties in the county by 2012. Judge Wettick noted that the county's newly submitted plan complies with the state supreme court's decision that found the county's base-year system to be unconstitutional and his order to follow a 4-year rotating assessment plan or offer a new plan that would institute new assessments by 2012. Earlier in the week, county solicitor Michael Wojcik drew the ire of the judge when he offered up a plan that would have delayed properties reassessments until 2013.

Under the new agreement, the county will send notices to property owners within the first quarter of 2010 and will hire an outside contractor by March to help with the reassessment process. Property owner lawyer Robert Junker says they have some concern that the under-staffed and over-burdened Office of Property Assessments won't be able to keep up with the time-line. But he says county administrators have promised to comply and he expects them to keep their word.

Judge Rejects County's Assessment Plan

A visibly upset judge has given Allegheny County until Friday to come up with a new plan to reassess all 570,000 properties within an acceptable time frame. In November Judge Stanton Wettick outlined a 4-year rotating assessment system to replace the county’s current base year plan that has been ruled unconstitutional. He also left the door open to the county creating a plan of its own to have all the work done by 2012. That order included an order that the county report its progress December 2nd. At the meeting yesterday the county offered a two and a half page plan that would not finish the work until 2013. The judge asked the county why it did not comply with his order and then asked the county chief assessor Edward Schoenberger if he had read the order. His response was that he had read “half of it,” saying his supervisors told him it did not comply with the state’s uniformity clause. County Solicitor Michael Wojcik apologized to the judge if the county had offended him. Judge Wettick quickly ordered a second meeting Friday. The county refused to comment on the proceedings but lawyer for the homeowners who originally filed suit, Ira Weiss, says he does not know what to expect Friday. He says so far the county has “thumbed its nose at the court” and it is “lucky [Wettick is] such a patient judge.” He says the county has meet the judge’s order with “petulance and defiance.” Donald Driscoll is another lawyer for the complainants. He says the plan offered by the county is “totally unacceptable” and the county “must make amends” to the tax- payers that have been over paying for years.

Onorato Not Happy About Order To Reassess

Despite a court order to reassess all Allegheny County properties within four years Dan Onorato is standing strong in his fight against reassessment. Last week Common Pleas Judge R. Stanton Wettick ordered Allegheny County to reassess all its properties within four years. Allegheny County Chief Executive Dan Onorato said the county will appeal the decision to the Commonwealth Court. Onorato is not happy that Allegheny County has to reassess its properties while other counties throughout the state that use the same assessment system do not have to. Onorato says that the State Legislature should step in and pass legislation that would put a moratorium on all property reassessment for two years. He says House Bill 1661, which would institute such a moratorium is being held up in committee. Onorato said that the only solution to the reassessment problem is a statewide standard that is fair and will ensure that homeowners do not have to face severe tax increases as a result of reassessment.

Judge Orders Four Phase Reassessment

Allegheny County Court of Common Pleas Judge R. Stanton Wettick has issued an opinion that Allegheny County shall launch a reassessment of all 540,000 properties beginning next year for use in 2011. The opinion calls for the Allegheny County officials to “…divide the county into four Assessment Districts. An entire school district and an entire municipality must be placed in the same Assessment District.” Each of those districts should have approximately the same number of properties. The county then must reassess the first District by October 1, 2011 for use by school districts and municipalities in the 2012 tax year. That value would then stay in place until the 2014 tax year. The judge asked the county to select the first District based on how far out of assessment the properties in the district have become since the last assessment in 2002. The second district would have to be assessed by Oct. 1, 2012 for use in 2013 and the assessment would remain in effect until 2015. The remaining two districts would follow the same pattern with the first assessments being completed by Oct. 1, 2013 and 2014. The county will continue to use the 2002 base year until all of the properties have been assessed. That allows for state uniformity laws to be followed. After the 4-year cycle is complete the ruling is tacit on how the county should proceed. Robert Junker is a lawyer with the Law Offices of Ira Weiss, which argued against the county’s base year system on behalf of property owners who felt they were being overtaxed. He says he thinks the judge is hoping the state will step forward by 2015 with new statewide assessment guidelines. Junker says his firm was initially not happy with the ruling because it was hoping for a faster remedy. However, he says they are pleased that this is moving forward with some sort of deadline and he does not expect an appeal. County Executive Dan Onorato has asked his legal department to review the opinion and will make a statement Monday. The county solicitor said in court that the county was awaiting a solution from the judge and would do whatever it takes to live up to his ruling. All involved parties are to be in court again December 2nd to discuss how the districts will be formed. Junker notes that there is nothing in the opinion that forces the districts to be contiguous. The county could pick municipalities from different parts of the county and place them in each district. The judge did leave the door open to listening to ideas from the county.

Allegheny County Council District 4 Race

Of the seven Allegheny County Council seats up for election Tuesday, only two have contested races including District 4. Democratic incumbent Michael Finnerty is seeking a second 4-year term and is being challenged by Republican Dean Petrone, who is making his first run for an elected office.
The 64 year old Finnerty is a retired reading specialist at Chartiers High School. He says one of the key things he's learned in his first term is getting along with his colleagues to get things accomplished and provide the best service possible for the people of Allegheny County.
Finnerty says an on-going challenge in the county is property reassessment. The county is under court order to end its 2002 base year property tax system and come up with a timetable for a reassessment of all properties in the county. Finnerty told DUQ he wants the state to come up with a uniform system "for all 67 counties to make the assessment process fair for everyone." He admits that other counties might balk at changing their systems and it will likely take lawsuits to force a change...as it did in Allegheny County when 4 homeowners challenged the base year system.
Finnerty says the county has been making progress consolidating some services with the city, but he would like to consolidate the county solicitor's and city solicitor's offices to have just one. He acknowledges that would require a voter referendum but "it could save a large amount of money."

The 40 year old Petrone is from North Fayette and is co-owner of an industrial and commercial automation company based in Collier Township. Petrone told DUQ that his business background in meeting a payroll and balancing a budget will help..."the day to day basics, the interactions with the business community goes a long way to help in the political spectrum especially the basic business practices are applicable in day to day planning of county government."
Petrone says the biggest issue is the tax burden on residents including the drink tax and car rental levy and what he calls the "house assessment debacle." He says spending needs to be controlled and taxes cut.
Petrone says one of his pet peeves is Pittsburgh International Airport and doesn't believe enough is being done to attract more airlines to the airport and more businesses around the facility.

County Councilman Introduces Assessment Bill

Allegheny County Councilman Chuck McCullough says he will introduce legislation at Tuesday’s council meeting that includes both a long and a short-term solution to the county’s property value reassessment battle. The measure would force the county to launch a neighborhood-by-neighborhood adjustment of the current property values for use in 2010 while at the same time launching a full reassessment of every property in the county. Those new assessed values would be released in 2011 for homeowner review and appeal. They would be put into effect in 2012. The bill also allows the county solicitor to go after any taxing body that violates the state anti-windfall laws and it allows for a three-year phase-in of any taxes that are increased due to reassessment. McCullough calls tat his “anti sticker shock” provision. The introduction will come just 30 hours after an Allegheny County Court of Common Pleas Judge heard arguments in a case that will eventually set a timeline for a county-wide reassessment. A State Supreme Court ruling struck down the county’s base-year assessment system this summer and then sent the issue back to the lower court. McCullough says while he knows judge Stanton Wettick will have final say in the matter he hopes the judge will take his proposal into consideration before issuing a ruling. During closing arguments Wettick wondered why he had not seen such a proposal from the County Executive. McCullough is the Republican At-Large member of the heavily Democratic controlled council. He says it is unclear how much support he has but he says he has been in contact with the Executive’s office while drafting the legislation.

Court Fight Over Assessment Timeline Begins

Allegheny County Court of Common Pleas judge R. Stanton Wettick heard from both sides today in the ongoing fight over a property reassessment in Allegheny County. This summer the Pennsylvania Supreme Court ruled Allegheny County’s base year property assessment system to be unconstitutional and sent the case back to the lower court to set a timeline for a new assessment. The plaintiffs (property owners and school districts) offered testimony that assessment numbers created in 2005 but never used could be compared to recent sales data to create new values. They say that would cost about $100,000 and take two months. The goal is to have the new numbers in place by January 15th. Plaintiff lawyer Ira Weiss says homeowners need a solution now because the ratio of real values to assessed values is too far out of line. The assessment industry standard is to keep all values within 20% of the assessed value but the number exceeds 30% in Allegheny County and some complained that it is even worse in high and low end neighborhoods. Weiss says by using a system known as “trending” those values can be brought closer to the 20% mark.
Trending involves comparing recent sales data to the most recent assessment and then applying a multiplier to all properties to arrive at new home values for taxing purposes. The “trending” can be done on any level from county wide, to individual taxing districts and on down to the neighborhood. There are about 2,000 neighborhoods set up by the county’s assessment office. Weiss says the reevaluation made using the “trending” method should be followed on closely by a full reassessment where every property is individually assessed and given a new value.
Allegheny County Solicitor Michael Wojcik says trending will not work. He says everyone agrees that the current numbers are bad but he thinks adding multipliers to them for the next few years would do more harm than would be done by leaving them alone while a full assessment is completed. A full assessment is expected to take 2-3 years and cost million of dollars. During the county’s closing arguments, Judge Wettick wondered aloud why he had not yet received a proposed timeline to complete a reassessment. Wojcik says he feels that time line should be set by the judge. He says when that happens; the county would do whatever it takes to live up to that ruling. The plaintiffs say the county is just dragging its feet. In the past Allegheny County Executive Dan Onorato has said that he had hopes the state legislature adopts a statewide assessment procedure before the county has to act on its own. Onorato is running for governor and has based much of his tenure as county executive on his fight against a countywide reassessment.

High Court: No Hold on Reassessment

Attorney Ira Weiss, says he’s glad the State Supreme Court is not allowing a reassessment delay for Allegheny County. Weiss represents Allegheny property owners that filed a lawsuit saying a base-year assessment was unconstitutional. A lower court agreed with the plaintiffs but the county quickly asked the higher court for a stay until the state legislature could act. The State House has passed a measure putting a hold on any reassessments but the senate is yet to act. The ruling means the issue now goes back to Judge Stanton Wettick who will decide how the county should proceeded with the reassessment of every property. County Executive Dan
Onorato says he thinks it will be months before the judge issues an order and he hopes the statewide moratorium will be in place by then. The ultimate goal is to change the state’s assessment laws altogether. Onorato says, “I will do everything in my power to prevent a reassessment if the other counties around us do not have to [reassess].”
Ira Weiss says the claim that the county is being victimized for having to reassess is purely fiction. “If you look at other counties that have not had reassessments in a long time, you’ll find that their millage [rates] are much higher than Allegheny County,” Says Weiss. “You need to look at all the numbers to figure out what the tax load is.”
Weiss says the legislation pending in the house (SB 1661) is irrelevant to Allegheny County’s situation. He says he thinks it won’t do any good. “This issue had been studied to death. There is really nothing more to learn about the different systems,” Weiss says. “To me, the notion of placing a hold on the constitutional mandate of fair assessment for the purpose of study is simply to put off the inevitable.”
Onorato counters, “No one is going to convince me how you can explain why Allegheny County has to do one when the counties that border us do not. That makes absolutely no sense… I don’t know how that survives the uniformity clause. It makes no common sense.”

House Bill 1661

Court-ordered countywide property taxes could be postponed if State Senate approves of a bill that would study the state’s property tax reassessment system and address the current problems with the system through enactment of the legislation.

State Representative Frank Dermody, bill sponsor from Allegheny County, says having each county make their own rules creates unfair taxing structures and making some counties uncompetitive.

“What is happening in Allegheny County where there was a lawsuit filed are we’re required to do another reassessment,” Dermody says. “The Supreme Court said that the general assembly is the proper place to develop a comprehensive scheme of assessment that is both comprehensive and constitutional.”

He says the moratorium would not apply to voluntary reassessments, and counties in the middle of a court-ordered reassessment would have the option of continuing with their process. The moratorium would remain in effect until the study is completed or until the end of June 2011.

Spot Assessment Bill Back on Front Burner

A group of lawmakers say they're not giving up on a package of property tax bills Governor Ed Rendell vetoed twice last legislative session. The latest effort to pass a measure eliminating so-called "spot appeals" of property taxes is making its way through the PA House. Two separate times, lawmakers sent Governor Rendell a bill that would ban school districts and municipalities from reassessing the property tax value of recently sold homes. Both times, Rendell struck down the measures. Representative Tim Seip says hiking property taxes on some homeowners, but not others, is fundamentally wrong. He says he watched it happen to a group of homes in his own district, “They're in a development that was built at the same time, by the same builder, with identical floor plans on identical lot sizes. But those who bought the homes prior to 1996 will pay one rate, and someone who moves in today will pay the 2009 rate for the same exact property.” Allegheny County lawyers have been fighting school districts engaged in spot assessments for the last few years. Seip's new package is identical to a bill that passed the House with 140 votes and cleared the Senate with 38 in the last session. Rendell's spokesman, Chuck Ardo, says the Governor would veto it again if it reaches his desk. He says Rendell is concerned the legislation would remove powers municipalities have to challenge county property assessments they think are too low. A suit field against Allegheny County’s assessment system could eventually force all counties in the state to assess properties more often.

High Court Asked to Stay Reassessment Order

Allegheny County Chief Executive Dan Onorato has asked the Pennsylvania Supreme Court to stay for 180 days its order for Common Pleas Court to determine a timeline for a countywide property reassessment. Onorato asked the high court for the delay to allow the legislature time to approve changes that he says are needed to make the assessment system fair in all 67 counties.."during these difficult economic times, families across Pennsylvania are worried that unfair property tax increases will make it even harder to stay in their homes."
On April 29, the state Supreme Court ruled that Allegheny County's 2002 base year system treated property owners unfairly. However, many other counties in the state also use a base year system.

Court Orders Property Reassessment

The Pennsylvania Supreme Court ruled today that Allegheny County must reassess its property values. County Executive Dan Onorato says it's because the rule violates the uniformity clause. In other words, a base year that is open ended is unconstitutional. Over the next few days, Onorato will develop a plan, and is optimistic that there are different options. He says that even if the county must reassess its properties, it does not necessarily need to be done in 2009 or even 2010. Onorato says having to reassess in Allegheny County is unfair, since all of the surrounding counties do not have to.

Supreme Court Says Allegheny Must Reassess

Allegheny County must reassess the value of every property in the county. The Pennsylvania Supreme Court ruled today that property values in the county have changed so much since the last assessment in 2002 that the numbers are no longer valid. The court stopped short of ruling that all base year systems in the state are faulty. The ruling could open the door to suits demanding new assessments being filed in nearly every other county. The decision in the Clifton et al and Pierce et al v. Allegheny County was unanimous. The justices noted that the current base year is most unfair for those who own property in poorer areas. In 2007 Allegheny County Judge R. Stanton Wettick threw out the county’s assessment system saying the use of a base year was unconstitutional. He ruled that a yearly reassessment was needed. The court disagreed saying a reassessment was needed only when the base year values and current sales values substantially diverge. It noted that has happened. The Supreme Court set an impossible reassessment deadline of March 31st 2009 based on the original case and then noted, “[R]ecognizing that the passage of time may require adjustment by the trial court, we will remand this matter to the trial court to determine Allegheny County’s progress in executing a countywide reassessment and to set a realistic timeframe for its completion.” That task now falls back into the hands of Judge Wettick. County Executive Dan Onorato based his campaign largely on support of a base year assessment. He argues that Allegheny County is put at a comparative disadvantage if the surrounding counties use a base year and Allegheny County does not. He also argues that it is too expensive and causes too much turmoil to reassess every year. Onorato has also lashed out at taxing bodies for taking what he calls a “back door windfall” every time assessments increase and millage rates are not rolled back to the point of revenue neutrality. Onorato is expected to address the ruling later today.

Base Year Goes Before State Supreme Court

Judge Stanton Wettick ruled that the use of a base year as a means to assess properties is unconstitutional if the law does not include a mechanism to trigger a reassessment. Lawyers representing home owners argued that the law should include either a set number of years between reassessments or a specific mathematical formula to figure deviation of real home values compared to assessed values. Appellee Don Driscoll says right now property owners have no way to demand a reassessment without hiring a lawyer and filing suit. He says that is too high of a burden. Allegheny County Solicitor Mike Wojcik argues that as numbers become more “out of whack” elected officials will do the right thing and reassess to head off any litigation. However other counties in southwestern Pennsylvania are still working on base years that are more than 30 years old. It is unclear when the court would rule but if it upholds the lower court decision it would force nearly every county in the state to reassess baring action from the state legislature.