The case for reassessment
County executive must act boldly for the good of Allegheny County
Allegheny County’s system of property assessment and taxation is broken. A countywide reassessment won’t fix that system — but is an essential prerequisite to fixing it.
The process to get to and then through the reassessment will not be easy, but this week brought the first step: The Pittsburgh Public School Board authorized its solicitor, Ira Weiss, to file a lawsuit challenging the county’s taxation system on the grounds that it violates the Pennsylvania constitution’s “uniformity” requirement in taxation. The claim will succeed in the courts, because it is obviously correct.
Howlong it takes to get to the actual reassessment will largely depend on the choices of County Executive Sara Innamorato. In a sense, it is unfair that she should have to shoulder this burden only three months into her term in office. On the the other hand, she knew this was coming from the very beginning of her campaign, when she advocated for a reassessment.
Ms. Innamorato tempered her early enthusiasm, but it’s time to return to form. The sooner the reassessment happens, the better it will be for the people of Allegheny County.
An unfair system
To understand how dysfunctional the current system is, let’s consider two real townhouses across the street from one another in Lawrenceville. To avoid drawing attention to anyone’s home, we’ll just call them Even and Odd.
The Even house was sold in late 2021 for $717,000. According to the real estate website Zillow, it has four bedrooms and four bathrooms in about 2,500 square feet of livable space. The Allegheny County property search portal reports the house is assessed at $556,700.
The Odd house was sold in the summer of 2023 for $700,000. It has four bedrooms and three bathrooms with over 3,000 square feet of space. It is assessed at $166,600.
That means the owner of the Even house, despite comparable profiles and sales prices, is currently paying over triple the property taxes as the owner of the Odd house. How is this possible?
Because the last countywide reassessment took place over a decade ago, all property values are pegged to that 2012 “base year” assessed value — unless either an owner or a taxing body (county, municipality or school district) appeals that value. The Even house was appealed, likely by PPS, after the 2021 sale set a new market value. The Odd house has yet to be appealed, or may never be appealed if PPS or the city doesn’t get around to it, so it’s valued as if it’s still 2012.
Every year that passes from the base year, the housing market strays further from the assessed values. In places like Lawrenceville, homes have appreciated at record rates, homeowners whose properties haven’t been challenged are paying far less in taxes than their market values would indicate. That means the tax burden has been shifted onto residents in areas where prices have stagnated or declined — Carrick, McKeesport, Stowe and so on.
Time’s wasting
When a reassessment sets a new base year foundation, usually about one-third of homeowners will see their taxes go up; one-third will see their taxes go down; and one-third won’t be affected much either way.
But there’s a catch this time that will make the reassessment politically more painful, even as it also makes it more urgent: The collapse in the value of Downtown real estate is shifting the tax burden from commercial to residential property.
“Anti-windfall” provisions ensure the taxing bodies can’t score new revenues from a reassessment, which means revenue levels are “locked in” when a reassessment is initiated. The longer it takes to get there, the more commercial real estate assessed values will have declined — barring an unlikely resurgence in office leases and construction over the next 24 to 36 months.
And the lower commercial values have fallen, the lower the “locked in” revenues will be, making tax increases at all the taxing bodies more likely.
Hard choices
Navigating the county’s government and residents through this process will take hard decisions and a steadyhand. That will begin with how tohandle the PPS lawsuit.
The choices for Ms. Innamorato are as follows: First, head off the lawsuit by calling a countywide reassessment herself; second, contest the lawsuit at the Court of Common Pleas so the judiciary can order the reassessment for her, then immediately fold to get the ball rolling; third, contest the lawsuit deeper into the state court system while making a big show of opposing adverse decisions, until she finally acquiesces under legal duress.
These options get progressively worse for the citizens of Allegheny County, but may seem to be progressively better for the county executive politically. Ms. Innamorato should place politics aside and do what’s right: getting the reassessment started as soon as the county is ready toperform it.
Unfortunately, Ms. Innamorato’s first statement about the PPS lawsuit lacked the clarity county residents and businesses need from their executive. Her promise “to gather all of the relevant data” and to “engage stakeholders at the state and municipal level to create a more thoughtful and consistent approach” lacked substance, and looks like stalling to devise a strategy for a problem she should have been thinking about for the last year.
The county does need a “consistent approach” to assessments — regular valuations, mandated by the state for every county — but it also needs a reassessment right
now. Waiting for state action on assessment reforms is waiting for Godot.
As the Editorial Board has said before: Reassessments are earthquakes, but like real tremors they get worse the longer the tension builds. For fairness; for stability; for the future: It’s time to reassess.