Property problems
Reassessment projects not mandated One of the problems with property reassessment projects in Pennsylvania is the fact that they are not mandated. Before Fayette County undertook a reassessment project that used a base year of 2001 and was implemented in 2003, the last reassessment hadn’t been done since 1957.
In 1985, plans to implement a reassessment were scrapped midway through the appeals process. At the time, the commissioners said they would take the project up in a year, which did not happen until 2001 when the board of commissioners that included Commissioner Vincent A. Vicites, former Commissioner Sean M. Cavanagh and the late Ronald M. Nehls conducted the project.
Members of the current board of commissioners have announced they will not implement a reassessment project that had been slated to take effect on Jan. 1.
A one-year study addressed in House Bill 334 has been ordered regarding reassessments in the state and the study is to be completed by June.
State Rep. Timothy S. Mahoney, D-South Union Township, a proponent of elimination of property taxes, had no comment on the study.
However, Mahoney said the problem with property taxes “goes back to the school districts.” He said his main objective is to find a way to reduce property taxes for school districts, which are usually higher than municipal or county property taxes.
Mahoney has introduced a bill seeking school consolidation as a means to cut costs and save taxpayers money.
“It goes back to consolidation which would definitely help property taxes. My school consolidation plan is a starting point to eliminate property taxes,” Mahoney said.
He added that ongoing talks in the state budget impasse have centered on levying an additional 1 percent sales tax, but he added that a condition is that 50 percent of the money would be used toward the elimination of property taxes.
State Rep. Bill DeWeese, D-Waynesburg, said Friday that he is somewhat “curious” regarding the Fayette County commissioner’s decision to scrap the reassessment, but said the decision points out an important issue.
“Fayette County’s conversation relative to reassessment simultaneously underscores and punctuates the need for a radical approach by the governor and General Assembly to either flat out eliminate property taxes by substituting sales taxes or at least slashing property taxes by 50 percent utilizing broad-based commonwealth revenues for the lost revenues at the local level,” DeWeese said.
At a recent meeting with representatives from the company hired to perform an independent evaluation of the process, Jeff Kern of Resource Technologies Corp. of State College said property values have dropped in the past year, but they are still higher than they were in 2001.
Kern said not implementing the project would mean going back to a base year of 2001, which is less accurate than using a base year of 2008, even with the recent downturns in the market.
Kern estimated that property values increased 80 percent between 2001 and 2008. He said they have deceased about 20 percent in the past year, but added that they are still 60 percent higher than they were in 2001.
According to figures from the Fayette County reassessment office, the reassessment data showed the assessed value of the entire county increased 36 percent.
The total price tag of the project was about $750,000, but chief assessor James A. Hercik said about $125,000 of that amount was budgeted for the appeals process.
With the decision to use the 2001 base year values, all the evaluation of sales data throughout the county will not be used.
That means some properties that sold for substantially more than their assessed value will still remain at the lower assessed value. Despite concerns about a drop in the real estate market this year, properties were sold.
The decision to halt implementation of the countywide reassessment project will mean that the assessed value of properties will revert back to base-year 2001 values.
While that may be good news to people who feel their new projected assessed values were too high, it also will mean that some people who recently purchased property at much higher than the assessed value will get a bargain on their property taxes in the foreseeable future.
In announcing their unanimous decision to stop the project, the commissioners cited different reasons, but among those mentioned was a concern about properties that increased by a large percentage. They also said there is no new timetable on when another reassessment would be implemented because of the uncertainty in the real estate market and economy.
Commissioner Vincent A. Vicites said he was specifically concerned with the fact that the project was using a base year of 2008, which did not factor in the downturn the local market has taken this year.
Commission Chairman Vincent Zapotosky said he was concerned that some property owners couldn’t pay taxes on the higher assessed values.
Commissioner Angela M. Zimmerlink pointed to the state’s a one-year study of the state’s entire reassessment system as her reason to scuttle the county reassessment project.