As Zach Stalberg notes, Philly City Council seems totally erratic these days, lurching from one idea to the next in search of a tax relief plan for AVI:
“If that [hodgepodge of proposals] feels like panic, I think it’s because they’re panicky,” says Zach Stalberg of the good-government watchdog Committee of Seventy. He calls it a symptom of poor planning and the punting of budget issues from one March to the next. “People are suddenly grasping for ideas, and it can seem really unorganized.”
Fortunately there is a better plan! Joshua Vincent has a hot new article in the Philadelphia Public Record critiquing the various proposals, and separating the better ideas from the worse ones.
In summary, Homestead Exemption, U&O Tax Increase, and Gentrification Relief all get the thumbs down, while Kenyatta Johnson’s Property Tax Deferral plan and my Gentrification Dividend idea get the thumbs up.
But most importantly, the piece introduces the mother of all property tax relief proposals – the Land Value Tax. Joshua gives a rough estimate of how many property owners would benefit from this, using the assessed values released so far, and finds that 77% of residential properties would pay less.
No politicians have mentioned this idea yet in the context of the debate over AVI and tax relief, but an early look at the new proposed assessments suggests a land-value tax could be just the answer Council is looking for.
Of the 530,000 properties which the new figures indicate are “complete,” 77% of residential properties would pay less under LVT than under the current property tax using the new values.
Many decreases would be quite significant. Around 67% of apartment buildings and 85% of mixed-use buildings, with ground-floor retail and apartments on top, would also see substantial savings. Commercial and industrial properties would pay more under LVT than the property tax using current values, but they would pay less than they did under the old assessments.
While Council is still casting about desperately for ideas, there is an opportunity to herd them toward the better options. Let’s do it!