School dis­tricts op­pose bill lim­it­ing chal­lenges

The Southern Berks News - - LOCAL NEWS - By Evan Brandt ebrandt@21st-cen­tu­ry­media. com @PottstownNews on Twit­ter

School dis­trict lead­ers are speak­ing out against a bill that could limit a school dis­trict’s abil­ity to chal­lenge a prop­erty as­sess­ment and, they say, could cost dis­tricts mil­lions in much-needed rev­enue.

The bill is spon­sored by state Rep. War­ren Kampf, R157th Dist., and is needed, he says, to help im­prove Penn­syl­va­nia’s busi­ness cli­mate.

In a memo to other leg­is­la­tors Kampf wrote in Fe­bru­ary be­fore he in­tro­duced the bill, he called the prac­tice “spot as­sess­ment” and wrote that “it is one of the most anti-com­pet­i­tive gov­ern­ment prac­tices in ex­is­tence to­day.”

He said it is cur­rently prac­ticed by only about 10 per­cent of school dis­tricts in Penn­syl­va­nia and “there is not a lot of it go­ing on this area.”

Nev­er­the­less, Potts­grove School Dis­trict Su­per­in­ten­dent Wil­liam Shirk said in a May 22 let­ter to dis­trict res­i­dents that the bill “doesn’t help se­nior cit­i­zens, low­in­come fam­i­lies or home­own­ers. It only helps com­mer­cial prop­erty own­ers. Un­for­tu­nately, this could come at the ex­pense of our schools.”

Although Potts­grove has not chal­lenged com­mer­cial prop­erty as­sess­ments, Shirk wrote that “mov­ing for­ward we want to pre­serve our right to ap­peal, be­cause of the po­ten­tial rev­enue it could cre­ate for the dis­trict.”

In fact, Potts­grove has wres­tled with the op­po­site prob­lem, chal­lenges that re­duce rev­enue and not raise it.

In Jan­uary, the school board ap­proved a set­tle­ment of three years of as­sess­ment chal­lenges brought by, among oth­ers, the own­ers of prop­erty where a Sanatoga strip mall and the cur­rent Lan­dis Su­per­mar­ket are lo­cated.

The set­tle­ment re­quired the dis­trict to cut a re­fund check of more than $200,000 and will cost another $70,000 in lost rev­enue an­nu­ally go­ing for­ward.

Sim­i­larly, the bill could mean “cuts to pro­grams and higher taxes for home­own­ers,” Shirk wrote.

“This re­stric­tion in the abil­ity to gen­er­ate fu­ture lo­cal rev­enues will harm schools that are al­ready grap­pling with over­all de­clin­ing state aid and un­fairly shift the prop­erty tax bur­den to home­own­ers,” wrote the Penn­syl­va­nia School Boards As­so­ci­a­tion in a May 8 let­ter to the House Com­merce Com­mit­tee.

“Any prop­erty that is sim­ply un­der-as­sessed for what­ever rea­son in­her­ently shifts the tax bur­den over to those prop­erty own­ers who are prop­erly as­sessed in the form of in­creased mil­lage rates,” PSBA wrote. “House Bill 1213 would take away the only voice on be­half of other home­own­ers and busi­nesses be­ing forced to sub­si­dize un­der-as­sessed prop­er­ties – school dis­tricts.”

But Kampf ar­gues his bill would pro­tect home­own­ers as well as busi­ness prop­erty own­ers.

Last month, he told Dig­i­tal First Me­dia, “imag­ine if your tax bill went up $9,000 overnight, and your neigh­bor’s did not? Wild fluc­tu­a­tions in prop­erty taxes can and do drive peo­ple out of their homes.”

How­ever some pro­vi­sions of the bill — par­tic­u­larly one which would have al­lowed as­sess­ments on com­mer­cial prop­erty to be based on the value of va­cant build­ings — have been re­moved.

“Some con­cerns came in from cit­i­zens about House Bill 1213, and my col­leagues and I are lis­ten­ing,” Kampf told Dig­i­tal First Me­dia.

One of those cit­i­zens was Phoenixville School Dis­trict Su­per­in­ten­dent Alan Fe­g­ley.

He noted that when the eco­nomic cri­sis hit and the real es­tate market crashed in 2007, “ev­ery­one was chal­leng­ing their as­sess­ment to lower their taxes and since then, as the econ­omy has re­cov­ered, school dis­tricts are chal­leng­ing as­sess­ments to try to re­cover what they lost.”

Fe­g­ley said he spoke to Kampf’s of­fice about his con­cerns and said he be­lieves a bet­ter ap­proach would be to pass a bill that re­quires coun­ties to un­der­taken a county-wide prop­erty re-as­sess­ment on a reg­u­lar sched­ule.

“Whether its ev­ery five years, or ev­ery 10 years, or you do some sec­tions of the county one year, and another the next, that would elim­i­nate the need for Rep­re­sen­ta­tive Kampf’s bill be­cause prop­erty would reg­u­larly be re-as­sessed,” said Fe­g­ley. PSBA agrees. “Is­sues with prop­erty as­sess­ment ap­peals by tax­ing bod­ies are merely a symp­tom of the state’s bro­ken as­sess­ment laws. Penn­syl­va­nia’s prop­erty as­sess­ment sys­tem needs com­pre­hen­sive re­form,” wrote PSBA. “Be­cause coun­ties through­out Penn­syl­va­nia are not re­quired to per­form a reg­u­lar re­assess­ment, it could be decades be­fore tax­ing bod­ies have any op­por­tu­nity to re­al­ize ad­di­tional rev­enues from on­go­ing re­de­vel­op­ment ef­forts and/or growth.”

PSBA con­cluded that “the proper ap­proach is to fix the cur­rent sys­tem that makes these ap­peals nec­es­sary in the first place.”

But Kampf said that is a much more dif­fi­cult bill to pass.

“We should not a de­sire for the per­fect stand in the way of the good,” said Kampf. Not­ing that Penn­syl­va­nia is “one of only two states that I know of that doesn’t re­quire reg­u­lar re­assess­ments,” the fact that it hasn’t hap­pened yet is no rea­son not to pass his bill.

Kampf’s bill ac­knowl­edges the pref­er­ence of county-wide re-as­sess­ments.

In fact pro­vi­sions in Kampf’s bill in its cur­rent form, pre­vent an as­sess­ment ap­peal by a school dis­trict or mu­nic­i­pal­ity based on a re­cent pur­chase, re-fi­nanc­ing or safety im­prove­ments. How­ever, an as­sess­ment ap­peal could be mounted af­ter a county-wide as­sess­ment, ac­cord­ing to the bill’s text.

Kampf said there is a com­pan­ion bill to his in the state Se­nate, and that he be­lieves there is a rea­son­ably good chance the bill could pass this year.

State Rep. Tom Quigley, R-146th Dist., state Rep. Marcy Toe­pel, R-147th Dist. and state Rep. Tim Hen­nessey, R-26th Dist. did not re­turn email re­quests ask­ing for their po­si­tion on Kampf’s bill.

“This re­stric­tion in the abil­ity to gen­er­ate fu­ture lo­cal rev­enues will harm schools that are al­ready grap­pling with over­all de­clin­ing state aid and un­fairly shift the prop­erty tax bur­den to home­own­ers.” Penn­syl­va­nia School Boards As­so­ci­a­tion “Wild fluc­tu­a­tions in prop­erty taxes can and do drive peo­ple out of their homes.” State Rep. War­ren Kampf, R-157th Dist.

ALL PHO­TOS DIG­I­TAL FIRST ME­DIA FILE PHOTO

The 50-per­cent re­duc­tion in the prop­erty as­sess­ment of 2190 E. High St. in Sanatoga, home to the Lan­dis Su­per­mar­ket, will cost the Potts­grove School Dis­trict $45,500 a year.

Potts­grove School Dis­trict Su­per­in­ten­dent Wil­liam Shirk

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