SLIDE 1
Judge Orders Allegheny County to Focus Lagging Reassessment Efforts on Pittsburgh Properties
October 13, 2011
Practice Group(s): Real Estate Land Use, Planning and Zoning Real Estate Investment, Development, and Finance Tax By Pierce Richardson and Brian J. Kluckman
Most property owners will have to wait longer than expected to learn how Allegheny County’s 2012 reassessment will affect them. Allegheny County officials recently told Common Pleas Court Judge R. Stanton Wettick that the reassessment project is about three months behind schedule and most of the new assessed values will not be in place by January 1, 2012. The delay has turned into a major headache for property owners and taxing authorities alike. In December 2009, following a ruling from the Pennsylvania Supreme Court that Allegheny County’s 2002 base-year property tax system was unconstitutional, Judge Wettick accepted Allegheny County’s plan (“County Plan”) to reassess all of its roughly 570,000 properties for the 2012 tax year. In short, the County Plan consisted of mailing property owners questionnaires related to the physical characteristics of their properties, conducting brief parcel-by-parcel reviews, and using the data gathered to create computer-generated appraisal models that calculate preliminary assessed values for all County properties. Under the County Plan, the County was to release preliminary values for all properties by July 2011. As of July 2011, however, the County reported that it had computed preliminary values for only 30%
- f residential and 31% of commercial properties.
After the County generates preliminary values, the County Plan calls for property owners to be afforded informal, in-person reviews of the preliminary values before they are certified. The informal review period allows property owners a brief opportunity to present evidence that shows a preliminary value is flawed. Several months after the informal review process ends, the County is supposed to certify new assessed values for 2012. Property owners would then be able to file formal appeals of the certified assessed values through the traditional channels. As a result of the delay, however, property owners in parts of the County may not receive certified assessed values for 2012 until May or June next year. The County Plan originally called for all certified values to be in place by January 2012. The County’s inability to provide certified assessed values on time for all County properties has led to much uncertainty for property owners and the taxing authorities. Obviously, property owners need to know what their 2012 property tax liability will be so they can budget accordingly. The flip side, however, is that the County, municipalities, and school districts cannot set tax rates for their budgets
- r collect taxes without the certified assessed values. This issue was recently addressed in a status
conference before Judge Wettick. Officials reported to Judge Wettick that the City of Pittsburgh and the city school district, which collect real estate taxes earlier than other districts in the County, would need to borrow on a short-term basis as much as $60 million to pay operating expenses that are usually paid with property tax
- revenues. The loans would reportedly cost $2 million in interest and fees. To save the City and its