Brace yourself home owners, it’s time for reassessment
It might be the single scariest word in the English language if you happen to be a home owner. Reassessment. Brace yourself, Delaware County. It’s been awhile, but every property owner in the county is about to have the value of their little chunk of this good earth re-evaluated.
For many people, buying a home is the largest purchase of their lives. They scrounge for years to save enough to make a down payment, then struggle to meet the mortgage each month. But of course there is another element they don’t usually talk about in all those colorful brochures and sales pitches. Taxes. Every property owner pays taxes to their local school district as well as the county Those payments are based on a property’s assessed valuation, a value assigned to it by the county. Now those numbers are about to be reconfigured, redone, or – cover your ears if you can’t bear the sound of the word – reassessed.
This week Delaware County Common Please Court Judge Charles Burr ordered the first complete reassessment of every property in the county in more than a decade.
No one especially likes the notion of having their property reassessed, for the most part under the belief that the increased value of the property will lead to a higher tax bill.
That’s exactly what has happened in Delaware County, and exactly why Burr made the right call.
The judge noted the fact that a county-wide reassessment has not been done since 2000, in effect creating an unfair playing field, with newer construction being smacked with a higher appraised property value than older, established properties. Burr ruled that lack of uniformity violates the state Constitution.
The judge ruled on a complaint filed by two county home owners who appealed the assessments on their new homes, one in Rose Valley and one in Haverford.
The two-story, three-bedroom townhouse in Rose Valley was purchased for $721,000 in December 2013. It was assessed by the county at $702,860, a 97 percent valuation. They appealed and saw their assessment reduced by the Delaware County Board of Assessment Appeals to $488,838.
In the Haverford complaint, a condo was purchased in August 2014 for $731,082 and initially assessed at $649,050, 88 percent of the sale price. The owners appealed and had the assessment lowered to $541,000.
The court case stemmed from the home owners’ belief that those assessments were still too high based on the common county practice of a 67.8 percent “common level ratio” for assessing properties, in other words the assessed value being 67.8 percent of current market value.
Burr agreed that the county’s methodology was unfair and ordered the county-wide reassessment.
As you might expect, this unlevel playing field was hitting hardest on new construction in the county.
“The primary argument was that there was a widespread lack of uniformity in the assessments used in Delaware County, which primarily affected new homebuyers,” said attorney John J. Murphy III, who represented the two home owners in this case. “The belief was that there was a pervasive lack of uniformity in property tax assessments, not only in (the petitioners) communities but throughout the county.”
Murphy zeroed in on the seeming inequities between the values assessed to existing homes as opposed to new construction, which he claimed were too high, thus violating the “uniformity clause of the Pennsylvania Constitution, which provides that all taxes shall be uniform, upon the same class of subjects, with the territorial limits of the taxing authority.”
In short, Murphy argued the county was violating that clause by the wildly differing assessments slapped on new construction as opposed to older homes.
“Comparable sales that the county was using bore no resemblance to the properties that were newly constructed,” Murphy said.
The result? Every property in the county will be reassessed.
Delaware County officials said the process will begin this year and continue over the next four years. The new assessment values are expected to go into effect in January 2021.
The county is moving to reassure property owners that they have taken steps to avoid some of the confusion and angst that accompanied the county’s last trip down this road in the late 1990s.
“The last reassessment was the first ever conducted by the county and at that time, assessors were required to visit and inspect every single property,” said Marianne Grace, county executive director. She vowed this will be a much different procedure. Not every home will necessitate a visit.
She also looked to reassure home owners who fear they could wind up with a hefty spike in their tax bills.
Both Murphy and Grace looked to ease home owners’ fears of a tax hike, pointing out that the changes to property values and resulting taxes must be revenue neutral.
“In other words, the county can’t use the reassessment to increase the tax burden overall on taxpayers,” Murphy said.
Grace concurred on the county’s side.
“It is important for all property owners to realize that reassessment does not necessarily equate to a property tax increase,” Grace said.
Since the move must be revenue neutral, the county could be in the position of seeing more revenue due to increased assessments. In that case, the county would be expected to lower their millage rate by whatever the increase was, thus making the bottom line neutral.
But that does not change the fact that some home owners will be paying more and some less once the reassessment is completed.
Delaware County is hardly alone in allowing this assessment gap. Neighboring counties are using ancient assessments, with Montgomery County’s based on 1996 numbers and Bucks County actually dating to 1972.
That’s not fair, and neither were the numbers in use in Delaware County.
You might not like it, but Judge Burr made the right call.
No one especially likes the notion of having their property reassessed, for the most part under the belief that the increased value of the property will lead to a higher tax bill.