The city this month announced it will help some homeowners who have fallen behind in paying their property taxes to get current and stay current.
They can accept that help, or else face foreclosure.
In an Oct. 16 news release, the Revenue Department outlined a program in which, based on income eligibility, will steer owners who live in their own homes toward paying down their outstanding tax debt.
The four-tiered program is based on a City Council ordinance, 120054, passed earlier this year. The city announcement, however, made no mention of the measure, which was introduced by Councilwoman Maria Quinones Sanchez and Councilmen Bill Green and Curtis Jones and co-sponsored by Brian O’Neill, Bobby Henon, Mark Squilla, Jannie Blackwell, W. Wilson Goode Jr., Dennis O’Brien, Marian Tasco and David Oh.
The Owner-Occupied Real Estate Payment Agreement will be offered to delinquent property taxpayers in a system based on family income and size.
Using a family of four as an example:
— Those with monthly incomes of $4,622 and higher must pay the full amounts of past due property taxes, including interest and penalties. Monthly payment amounts will be set at the discretion of the city’s Revenue Department.
— Those with monthly incomes from $3,301 to $4,621 must pay 10 percent of their monthly incomes. They are entitled to waivers of 100 percent of accrued penalties.
— Families with monthly incomes from $1,981 to $3,300 most pay 8 percent of their monthly household incomes. They are entitled to waivers of 50 percent of the interest and 100 percent of the penalties accrued on their delinquent taxes.
— Those with monthly incomes of zero to $1,980 must pay the city 5 percent of their monthly incomes, but no less than $25 per month. All interest and penalties will be waived.
To qualify and continue with the payment plans, applicants must remain current or under agreement for current and future real estate taxes. The penalties for not living up to an installment agreement with the city is to be dropped from the program and face speedy foreclosure.
According to information on the bill signed by Mayor Michael Nutter in June, Philadelphia has the least-effective tax-collection system of nation’s largest cities, with 110,000 delinquent parcels that represent almost 19 percent of all the properties in the city.
In a phone interview last week, Henon said his 6th District has about 1,700 delinquent owner-occupied properties, which represent $7 million of the citywide $150 million debt such properties owe.
Three-quarters of the owners of those parcels in his district are not on any kind of payment plans right now, he said. They can apply for this new program, which he described as accommodating, but tough, he said.
“This is a game changer,” Quinones Sanchez said in a phone interview last week.” It gives homeowners who’ve been affected by the bad economy the opportunity to get on some sort of payment plan that is realistic for them and potentially save their homes, she said.
“That is huge for Philadelphia,” she said. “There are a lot of people who, because of the economy, are backed up, and we want those people to come forward and get compliant,” she said.
In March, when the bill was still under consideration, Green said the plan was not meant to be an amnesty or an infinite-payment plan. Those who don’t pay or play by plan’s rules will start getting foreclosure notices sooner, not later. Also in March, Quinones Sanchez stressed that residents will get notices about the program so they know they can get on payment plans. Previously, she had said, getting on a plan was a matter of knowing there was a plan, and not everybody did.
Quinones Sanchez said the better part of the bill passed in the spring is that “it forces the city to go after the money it should be collecting from investors and others who know the city never comes after them.”