We need tax fairness to ensure that tax deadbeats pay what they owe, and homeowners do not receive yearly property tax hikes. More than a year ago, we gathered with neighbors in Tacony to push for tax fairness and we went to work in the General Assembly. Recently, two bills were passed in Harrisburg to improve tax fairness and help hard-working homeowners in Northeast Philadelphia.
The two laws will not only help Philadelphia, they will help struggling cities across the state by letting deadbeat property owners know that they can run, but they can’t hide, from their obligations to our school children and law-abiding taxpayers.
House Bill 388, sponsored by Philly’s own Rep. Cherelle Parker, allows municipalities to put a lien on any Pennsylvania properties owned by a deadbeat taxpayer. Current law allows the city to put a lien only on properties within its borders. This is a companion bill to Sen. Mike Stack’s Senate Bill 467.
It’s not uncommon for a slumlord to make money renting a property while it deteriorates, then abandon the building and the tax bills on it. These properties end up not worth the legal cost of enforcing the lien, and the owner already has moved on.
This cynical practice fractures neighborhoods and overburdens city government but, worst of all, it cheats our school children out of the education they deserve and it puts an even bigger burden on law-abiding property owners.
Now, Philadelphia and other cities can put a lien on any Pennsylvania property owned by the same business or individual, which could help recoup hundreds of millions of dollars lost to delinquent property owners.
With this new law, Philly schools have the potential to receive a $250 million infusion from late real estate taxpayers, $90 million in tardy business income and receipts taxes, and $50 million in overdue wage taxes.
How many books, computers, counselors and teachers could be added – or returned – to our schools with an additional $390 million?
The School District of Philadelphia’s budget deficit this year was about $300 million, and we all still shudder when we think of the phrase “doomsday budget.”
Rep. McGeehan sponsored a bill that will help people manage their real estate bills and make the payment of real estate taxes more manageable and fair. Rep. McGeehan’s House Bill 391 gives taxpayers the option of paying real estate taxes in monthly installments.
For many homeowners, property tax bills are difficult to pay in one lump sum, and current law doesn’t allow for a system of installments. In addition to spreading out the burden for taxpayers, school districts could benefit from a steady stream of payments rather than having to wait for a once-a-year lump sum.
We believe this idea will make tax collection easier for the city, the school district and the homeowner. One of the ways we are making progress in the General Assembly is by showing lawmakers from across Pennsylvania that they are not immune from the problems facing Philadelphia.
Even the most conservative, rural districts have a third-class city at their core with financial challenges that are the same, with smaller numbers, than what we face in Philadelphia.
That recognition has been a long time coming across a wide and diverse state. But whether you live in Philly, Erie, Williamsport, Chester, Johnstown, Altoona or Aliquippa, you want your children to have a fair opportunity and you want confidence that your tax system is protecting those who abide by the law. ••
Sen. Mike Stack, a member of the Senate Education Committee, represents the 5th Senatorial District. Rep. Michael McGeehan, author of House Bill 391, represents the 173rd Legislative District.