PHILADELPHIA (CBS) — Philadelphia’s Tax Abatement program could be going away. City Council held a public hearing Tuesday afternoon on a proposal to do away with the tax-saving benefit program for new home buyers.
The council says by doing away with the abatement, the city stands to bring in nearly $300 million in tax revenue over 10 years. They also say that could help fund schools and other city services.
But for those who are benefiting from the abatement, they say it’s about being able to afford where they live.
“As somebody who was only able to afford this house because of the abatement and was only able to consider this area because of the abatement, I am very concerned,” Tyler Doppelheuer said.
The concern is brewing in Point Breeze as talk to repeal the city’s 10-year tax abatement heats up.
Doppelheuer bought a rehabbed home here and benefits from the tax abatement and says his neighborhood along South 22nd Street has grown a lot over the years thanks to the abatement.
He is also a realtor and says Philly’s real estate market will be hurt if the abatement is repealed.
“Especially first-time home buyers, it’s really going to have an impact. The tax abatement is really a great way to get people to be able to afford homes, especially in neighborhoods that are growing, that are changing and really to those that haven’t seen a lot of change in 20 to 30 years,” he said.
The abatement was put in place nearly 20 years ago to spur development and to get people to move back to the city. Since then, the city says 50,000 people have moved to Philadelphia.
But, as City Council President Darrell Clarke says, the abatement was too much of a good thing.
“Is it fair for a person who lives next to a $600 to $700 house that doesn’t pay property taxes and the person next door their taxes are going up beyond their expectations?” Clarke said.
Clarke says schools and other city services are taking a hit because of the abatement. His proposal would phase it out by 10% a year over 10 years.
Thirty people registered to speak at Tuesday’s hearing. Some like Peg Shaw say the abatement is forcing taxpayers out of their homes.
“Its absolutely something that benefits the wealthy at the expense of the poor, or even the wealthy or the middle class,” she said.
The council is moving quickly on this proposal because a new council takes over in January. If it is approved, this would go into effect in July 2020.