Tax talk

Realtors want city to start collecting on delinquent taxes.

Join the club: Pic­tured are (from left) Great­er Phil­adelphia As­so­ci­ation of Re­altors Pres­id­ent Al­lan Domb, Ex­ec­ut­ive Dir­ect­or Di­ane Lu­cidi and Sec­ret­ary Joe Rey. The board is work­ing to in­crease its mem­ber­ship in the North­east. MARIA POUCH­NIKOVA / TIMES PHOTO

The pres­id­ent of Phil­adelphia’s lead­ing or­gan­iz­a­tion of real es­tate agents is fed up with the city’s in­ab­il­ity or un­will­ing­ness to col­lect de­lin­quent taxes and he’s look­ing for oth­ers who share his dis­gust. More spe­cific­ally, he wants agents who work or live in the North­east to hop on board.

It makes per­fect sense, ac­cord­ing to Al­lan Domb, pres­id­ent of the Great­er Phil­adelphia As­so­ci­ation of Re­altors. After all, out of more than $490 mil­lion in de­lin­quent prop­erty taxes city­wide, only about $23 mil­lion — 4.7 per­cent — is due on prop­er­ties with­in nine ZIP codes that en­com­pass the vast ma­jor­ity of the North­east, ex­clud­ing south­ern por­tions of Frank­ford, Ox­ford Circle and Lawn­crest.

Simply put, “The North­east has the low­est level of real es­tate tax de­lin­quency” in the city, Domb told the North­east Times in a re­cent in­ter­view.

GPAR gleaned those fig­ures through its own re­search lead­ing up to this year’s im­ple­ment­a­tion of the Ac­tu­al Value Ini­ti­at­ive, a city pro­gram de­signed to over­haul and stream­line Philly’s com­plic­ated prop­erty as­sess­ment and tax­a­tion for­mula. GPAR launched its study to en­sure that the city wasn’t try­ing to im­ple­ment what many cyn­ics feared would amount to a back­door tax in­crease. In the pro­cess, GPAR shed new light on the stag­ger­ing de­lin­quency rates, in­clud­ing geo­graph­ic break­downs by ZIP code and coun­cil­man­ic dis­trict.

Since then, GPAR has made it a pri­or­ity to provide city gov­ern­ment with the tools and the will to real­ize those miss­ing funds, which could help pub­lic schools avert fin­an­cial Armaged­don while boost­ing oth­er pub­lic ser­vices. Per­haps sur­pris­ingly, the North­east has been un­der­rep­res­en­ted in the Re­altors’ ef­fort, as the level of GPAR mem­ber­ship is re­l­at­ively low in the North­east com­pared to oth­er areas of the city.

The Pennsylvania De­part­ment of State’s Real Es­tate Com­mis­sion li­censes real es­tate pro­fes­sion­als in nu­mer­ous cat­egor­ies. Al­most 3,000 stand­ard sales­per­son li­censes are act­ive in Phil­adelphia,, ac­cord­ing to the de­part­ment, in ad­di­tion to sev­er­al hun­dred “as­so­ci­ate,” “sole pro­pri­et­or” and “cor­por­ate part­ner” li­censes that of­ten over­lap with the sales­per­son li­censes.

There is no re­quire­ment that those folks join GPAR, whose mem­bers co-foun­ded the Na­tion­al As­so­ci­ation of Re­altors in 1908. GPAR has about 1,800 mem­bers, ac­cord­ing to Ex­ec­ut­ive Dir­ect­or Di­ane Lu­cidi. Al­though a geo­graph­ic break­down of mem­ber­ship is not read­ily avail­able, Lu­cidi said that, an­ec­dot­ally, the North­east has less of a con­cen­tra­tion than oth­er areas of the city. Many de­cide to join Re­altor as­so­ci­ations in sub­urb­an counties, per­haps be­cause the ini­tial cost is cheap­er, or they don’t join any as­so­ci­ation.

The dis­tinc­tion can be con­fus­ing. “Real es­tate agent” is a gen­er­al term for any li­censed pro­fes­sion­al. “Re­altor” is a spe­cif­ic, re­stric­ted term lim­ited for use with mem­bers of the NAR and its state and loc­al af­fil­i­ates.

“It’s im­port­ant to dis­tin­guish a Re­altor from a li­censee,” Lu­cidi said. “A Re­altor is a pro­fes­sion­al who is held to cer­tain stand­ards. That’s im­port­ant to the con­sumer be­cause, at the end of the day, there are safety nets and safe­guards [with a Re­altor]. There is a level of edu­ca­tion. Every two years, Re­altors need to take con­tinu­ing edu­ca­tion courses and every four years quad­ren­ni­al train­ing, which up­dates them on the code of eth­ics. It’s im­port­ant.”

Mem­ber­ship is also about pro­fes­sion­al de­vel­op­ment and ad­vocacy for both mem­bers and the pub­lic, ac­cord­ing to Joe Rey, a Fox Chase-based Re­altor and sec­ret­ary of the GPAR. For in­stance, the as­so­ci­ation hos­ted a re­cent sem­in­ar at Moshulu, where five of the city’s top-selling agents shared strategies and tips.

“I learn a lot from be­ing with them and do­ing things where you pick up tech­niques and learn how to be a bet­ter Re­altor at the end of the day,” Rey said.

In an ef­fort to ex­pand GPAR’s in­flu­ence in the North­east, Rey helped the as­so­ci­ation or­gan­ize a series of net­work­ing events at the Fraternal Or­der of Po­lice hall on Car­oline Road. One re­cent gath­er­ing at­trac­ted more than 150 mem­bers and non-mem­bers, in­clud­ing agents and folks in af­fil­i­ated sec­tors such as mort­gage and build­ing trades. The func­tions are so­cial and char­it­able. At one, at­tendees raised funds for the fam­ily of a GPAR mem­ber who had passed away sud­denly.

“It’s been my fo­cus to run more events in the North­east to get more real es­tate agents in­volved with GPAR and all the good things that we’re do­ing for the city in gen­er­al,” Rey said.

Ac­cord­ing to Lu­cidi, a South Phil­adelphia nat­ive, the as­so­ci­ation also helps mem­bers with the day-to-day is­sues they face. In one case, an agent went to the Mu­ni­cip­al Ser­vices Build­ing to settle a tax bill for a cli­ent, only to dis­cov­er that the city had en­acted a new $100 “ex­ped­it­or” fee for the routine trans­ac­tion. The agent called the GPAR of­fice. Lu­cidi con­tac­ted City Coun­cil, which with­in a month amended the fee to ex­empt real es­tate agents — not just Re­altors, but all agents.

Domb, who is based in Ritten­house Square and op­er­ates city­wide, is al­ways work­ing on the big­ger pic­ture. Last fall, he lob­bied Coun­cil to pass a law that would al­low the city to col­lect on its un­paid taxes though the sale of li­ens on de­lin­quent prop­er­ties. In ad­di­tion to out­stand­ing real es­tate taxes, prop­erty own­ers owe the city about $370 mil­lion in de­lin­quent wa­ter/sew­er and gas bills. Coun­cil passed the meas­ure 15-2 in Oc­to­ber. The may­or signed the bill in Novem­ber.

“We did an ana­lys­is and ac­tu­ally think that between $350 mil­lion and $500 mil­lion could be col­lec­ted” through a li­en sale, Domb said. “And of that amount, 55 per­cent would go to the school sys­tem. And they need money. … The day after the le­gis­la­tion passed, I got an email from a tax li­en com­pany in Jer­sey of­fer­ing $250 mil­lion for the li­ens, which tells you they’re worth a lot of money.”

A li­en sale has yet to oc­cur. Some crit­ics fear that li­en sales would lead to mass fore­clos­ures in the city, with the areas of highest de­lin­quency gen­er­ally in the city’s poorest neigh­bor­hoods. Domb coun­ters that few­er than 1 per­cent of tax li­en sales na­tion­ally end up in fore­clos­ure.

Out­side of the un­paid tax prob­lem, the GPAR be­hind Domb’s lead­er­ship is work­ing hard to keep and ex­pand the city’s prop­erty tax abate­ments for new con­struc­tion. The as­so­ci­ation views it as an eco­nom­ic en­gine that brings de­vel­op­ment, jobs and res­id­ents in­to the city. Mean­while, the GPAR has suc­cess­fully op­posed a statewide ef­fort to change school fund­ing from a real es­tate tax-based mod­el to one based on wage and sales taxes. A bill to do that nev­er made it out of le­gis­lat­ive com­mit­tee last spring, des­pite ad­vocacy by the Pennsylvania As­so­ci­ation of Re­altors.

GPAR op­posed it be­cause the meas­ure would’ve provided for full fund­ing of pub­lic schools out­side of Phil­adelphia but only 80 per­cent of the city’s schools, ac­cord­ing to Domb.

“We were the only as­so­ci­ation in Pennsylvania that went against it. I think it’s dead,” he said. “What was unique about us was we went against the tide.” ••

For in­form­a­tion about the Great­er Phil­adelphia As­soo­ci­ation of Re­altors, vis­it

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