By Mike Dunn
PHILADELPHIA (CBS) – A report from the Pew Charitable Trusts says Philadelphia’s new “AVI” property tax system will do precisely what experts had expected: shift a greater percentage of the total take from commercial to residential properties.READ MORE: Abortion Rights Advocates Gather For Bans Off Our Bodies Protest In Philadelphia After SCOTUS Overturned Roe v. Wade
The Pew analysis of the new assessments finds that the percentage of property taxes borne by individual homeowners compared to other owners will go from about 54 percent under the old system to about 60 percent under AVI. That six percentage point shift amounts to $72 million dollars in revenue. This shift had been fully expected by city officials and outside experts.
The author of the report, Emily Dowdall of The Pew’s Philadelphia Research Initiative, attributes the shift to the fact that residential property assessments were more out of date, prior to AVI, “And at the same time, commercial and industrial properties were over assessed relative to the citywide average. So now, after AVI, residential properties — as well as another group, stores that have dwellings — will account for a greater share of the city’s total property value, and therefore the property tax burden as well.”READ MORE: Brandywine Valley SPCA, Other Shelters Holding Mega Adoption Event This Weekend
The effect of this shift toward residential could be mitigated — though not eliminated — by the relief measures, including a homestead exemption, now being considered by the mayor and city council. The Pew report finds that a homestead exemption at $15,000 per house would shrink the dollar value of the shift to residential by about $20 million.
“Residential property owners will stay pay more no matter which (relief) policies are enacted, but these kinds of policies could lessen that shift,” says Dowdall.
And even with this shift, the Pew finds that residential homeowners in Philadelphia will still have lower property taxes than in many other cities, including Pittsburgh and Baltimore.MORE NEWS: Hundreds Rally For Abortion Rights In Philadelphia With Democratic Gov. Nominee Josh Shapiro, Planned Parenthood