Listen To This Article:
The state Supreme Court today declined to hear Beaver County’s appeal of a lower court ruling requiring it to reassess every taxable property in the county.
Because of county officials’ appeal machinations, the initial ruling to have all properties reassessed by June 2020 with new tax payments taking affect in 2021, will be pushed back possibly by a year. The county court will have to set new deadlines.
The county now must bid out a contract to an independent firm for the work, and along with expected increased assessment office costs, the total price tag will be in the millions of dollars.
Local predictions and statewide comparisons range from $5 million to $10 million, a cost the county alone assumes.
The county has approximately 91,000 total parcels, of which about 88,000 are taxable.
State officials say reassessments typically result in about a third of property owners seeing their taxes increase; a third seeing their taxes decrease; and a third unchanged.
Current county property taxes are based on 1982 assessments, and the reassessment prior to that had been done in the 1950s.
The current situation and the 1982 reassessment have a few key similarities: Both were spurred by lawsuits, have roots along the same stretch of Aliquippa riverfront, and both involve Camp family members.
A J&L Steel Corp. assessment lawsuit filed in 1979 preceded the last overhaul. Now, a 2015 lawsuit filed by prominent county businessman C.J. Betters, who owns Aliquippa property once occupied by the steelmaker, is forcing another.
In 1982, Commissioner James G. Camp helmed the board of commissioners. Currently, his distant cousin Dan Camp holds the same seat.
The year following the last reassessment, voters overturned the entire board of commissioners for the only time in at least the last 60 years.
“A HUGE EDUCATIONAL EFFORT”
In Pennsylvania, whether to reassess taxable property is under each county’s purview, unless forced by litigation.
But because taxpayers often vote with their wallets, it’s a very unpopular tack for politicians. Countywide reassessment is also difficult to easily explain.
For those reasons and more – including assessment-related litigation in recent years – the Local Government Commission (LGC) of the Pennsylvania General Assembly created a task force to help counties do it right.
“It’s a huge educational effort,” said LGC research associate Danette Magee. Officials need to explain each step; public relations are crucial.
Unlike some states, Pennsylvania doesn’t have an oversight agency. The county chief assessor and his or her office supervises valuations and provides technical expertise to the county governing body and board of appeals, if applicable.
Each county chooses on its own whether to value property on current market value or on a base year, which is 1982 in Beaver County’s case.
There is no rule on when or how often it must reassess. The decision to reassess is an entirely local decision, unless ordered by court.
Each county also selects the percentage of market value at which a property will be assessed. It could be from 1 to 100 percent of actual value. Beaver County had assessed at 30 percent, and changed it to 50 percent with the 1982 reassessment.
It would be likely the county would choose to set a future reassessment at 100 percent market value, Chief County Assessor Kevin McIlvain said.
All property in the county must be assessed the same way.
“One thing that people misunderstand is the provision that requires the taxing district to equalize their millage the next year (following the reassessment,)” Magee said.
For example, if your home is assessed at $50,000 and taxed at 20 mills, then reassessed at $100,000, the taxing body must reduce its millage rate and keep it “revenue neutral” for the overall taxing district.
Taxing bodies currently do have the ability to raise taxes up to 10 percent in the first year after a reassessment, but a second vote must be taken, Magee said.
After that first year, there is no cap.
Following is a BeaverCountian.com Q&A with Magee:
Q: What does a reassessment typically cost a county of our size. Can you provide an example of another recently reassessed county?
A: (Here’s a) response from an individual employed by a revaluation company:
Typical reassessment (not including software) is around $50-$55/parcel. The more parcels and the more dense the parcels, the lower the price usually. Obviously things like large commercial and industrial areas can also skew the pricing upward.
But the $50-$55/parcel is a good rule of thumb for a traditional reassessment.
Monroe County was $5,000,000 for 105,000 parcels. (Monroe County is the same class county as Beaver, and is currently completing a countywide reassessment. The county last reassessed in 1989.) Delaware County was only $6,000,000 for approximately 200,000 parcels. Delaware County is unique in that 40% of their parcels are high density and have little or no chance of major changes to their footprint. (Delaware was court-ordered to reassess. The county is in the beginning phases of a reassessment; it is much larger than Beaver County.)
(Here’s a) response from a county chief assessor who has a great deal of experience with countywide reassessments and is certified as an instructor for the Assessors’ Association of PA:
◆ Indiana – last reassessment 2016. $51.77 per parcel+ 600k. 49k parcels (previous reassessment 1960’s, 6th class county; smaller than Beaver)
◆ Washington – last reassessment 2017. $72 per parcel. 120k parcels (previous reassessment 1981, 4th class county; same as Beaver.)
◆ Blair – last reassessment 2017. $53.77 per parcel. 65k parcels (previous reassessment 1958, 5th class county; smaller than Beaver.)
◆ Delaware – $30+ per parcel. 200k parcels (previous reassessment 2000, 2A class county; much larger than Beaver.)
Q: Is there any state assistance with the cost, or is it entirely borne by the county?
A: No. In the late 1980s, the LGC introduced legislation to create a grant and loan program to assist counties in conducting reassessments and upgrading assessment technology. Other legislation similar to the LGC’s was introduced in the 1990s.
Q: I’ve read that about a third of taxpayers experience a tax increase, a third a tax decrease, and a third are unchanged (following a reassessment.) Is this an accurate typical reflection? Is there a breakout between residential and commercial properties?
A: (Here’s a) response from an individual employed by a revaluation company:
The 1/3, 1/3, 1/3 is something that is only sometimes accurate. I stayed away from using it for years, but realized that taxpayers were having a hard time understanding the impact of a reassessment.
So there’s no real harm in explaining it that way because it helps people.
When used it is talking about commercial and residential. However, like I said, it’s not always true. Think about it this way: you’re coming up with all new assessments. Let’s say all the new values were perfect! You still can’t really generalize the impact because that impact depends on the old assessment as well as the new. The reality is there is little or no chance that someone could analyze a county prior to a reassessment and accurately predict the impact.
So the 1/3 way of explaining, while we don’t know how accurate the statement may be, it definitely helps the public wrap their head around the results.
Q: Finally, has there been any discussion in the Legislature on requiring counties to reassess at certain time periods? Or to take any other annual measures to keep assessments up to date?
A: Yes, for decades!
As you can imagine, this is a volatile topic. A Pennsylvania Senator has indicated via a co-sponsorship memorandum his intent to introduce legislation this session that will mandate cyclical reassessments.
The bill has not been introduced as of this date. The LGC’s Assessment Reform Task Force discussed mandating that each county conduct a ratio study every X amount of years to evaluate the uniformity of property assessments in the county.
Ultimately the Task Force concluded that it was best to allow the county assessment office personnel to work with their commissioners to determine when to conduct these studies.
What happened the last time there was a countywide reassessment? Read the fascinating history as compiled by BeaverCountian.com in the following in-depth report: