PHILADELPHIA — Responding to large increases in property reassessments for homeowners, a City Council committee today gave preliminary approval to a fiscal 2023 city budget that will mitigate those reassessments, while continuing to make investments in public safety to help prevent gun violence in Philadelphia.
The $5.6 billion budget received approval in Council’s Committee of the Whole this evening, by a vote of 17-0. It is scheduled to receive first reading by the full Council in its Meeting on June 16. Final passage of the budget is scheduled for June 23.
The budget deal agreed to by Council and the Kenney administration takes important actions to ease the burden on property owners, who are facing average assessment increases of 31 percent, following the first citywide reassessment of real estate since before the COVID-19 pandemic. Council voted to approve an increase in the city’s Homestead Exemption to $80,000. This means $80,000 of a property’s assessed value would be exempted from property taxes. The current Homestead Exemption in Philadelphia is $45,000, so Council’s action nearly doubles the exemption. Every property owner is eligible. For an average Philadelphia homeowner, the increase in the Homestead Exemption to $80,000 means an annual savings of $1,119 on next year’s property taxes.
Council also voted to increase funding for the LOOP program, the Longtime Owner-Occupant Program, which assists longtime property owners facing the impact of rising property values and taxes from gentrification. The LOOP budget was $25 million this year. Mayor Kenney proposed increasing it to $30 million. Council increased it further – to $35.2 million.
In another tax mitigation effort, Council voted preliminarily to reduce the city’s wage tax on residents and commuters, as well as reducing city business taxes. The wage tax on residents would decline from 3.83 percent to 3.79 percent, while the wage tax on commuters would decline slightly, from 3.448 percent to 3.44 percent.
The net income portion of the city’s Business Income and Receipts Tax (BIRT) would decline from its current 6.2 percent to 5.99 percent, under the budget approved tonight.
At a time when gun violence remains at or near a record pace this year, City Council remains focused on public safety and gun violence prevention strategies. Along with $184 million in violence prevention programs proposed in the budget by the Kenney administration, Council took additional actions tonight to further address public safety in neighborhoods.
- Keeping Recreation Centers with Gyms Open on Weekends. $2.5 Million
- Community Life Improvement Program Expansion. $5 Million
- Street Lighting Improvements. $1 Million
- Licenses & Inspections Clean & Seal, Demolitions. $1 Million
- Abandoned Vehicle Removal. $2 Million
- Short Dumping – Cleaning, Investigations. $2 Million
- Crime Forensics Lab. $5 Million
- Security Cameras Near Schools. $1.8 Million
- Further Camera Enhancements. $2.5 Million
- Staffing for Security Cameras. $950,000
- Phila. Police Recruitment. $250,000
- Office of Victim Advocate. $500,000
- Domestic Violence Hotline. $100,000
- Defender Association. $5.8 Million
“When the property reassessments were announced, City Council said it would do everything within its power to mitigate the impact of those assessment increases on homeowners,” said Council President Darrell L. Clarke (5th District). “With the increase in the Homestead Exemption, and the additional LOOP funding, Council is taking real steps to help homeowners.”
Clarke also noted that Council approved an amendment to the city Capital Budget to add funding for security cameras outside schools where gun violence has occurred. “We need every child to be safe when they go to school,” Clarke said. “These cameras are a good start, and they’ll lend “eyes” to law enforcement officials working to keep our kids safe from harm.”
“This was not an easy budget,” said Council’s Majority Leader, Cherelle L. Parker (9th District). “Led by Council President Clarke, my Council colleagues and I rolled up our sleeves to negotiate improvements to the budget. We are approving property tax relief measures to mitigate the effects of the reassessments. We’re approving reductions in wage and business taxes – to provide badly-needed relief to small neighborhood businesses. At the same time, we fought for increased investments in my Philadelphia Neighborhood Safety and Community Policing Plan – including more funding for police recruitment, and to address quality-of-life issues like abandoned cars, street lighting, and illegal dumping. This budget Is a direct response to these critical needs.”
Council’s focus in hearings and in this deal on quality-of-life improvements wasn’t lost on Council leaders. “Let there be LIGHTS!,” said Council’s Whip, Curtis Jones, Jr. (4th District). “Street lights and alley lights are not always a front-page story — until they don’t work. Increasing driveway lighting and alley lights are a part of an overall public safety agenda.”
Another leader emphasized the reduction in the Business Income and Receipts Tax. “The negotiations and collaborations of the Administration and my Council colleagues have resulted in a budget that provides safeguards for our residents, while reducing the tax burdens on our business community,” said Council’s Deputy Whip, Mark Squilla (1st District).
Under the budget agreed to tonight, the city’s Wage tax will decline slightly.
“At this critical time this budget must invest in neighborhoods and show that the city is open for business,” said Appropriations and Education Chair Maria Quiñones Sánchez (7th District). “As Appropriations Chair, I have worked through this budget process to make sure that above all we are investing in people.”
“We need to help homeowners with relief from the mayor’s assessment increases, as well as assist small business owners – in particular, Black and Brown entrepreneurs – that were decimated by the COVID-19 pandemic,” said Councilmember Derek Green (At Large), who chairs Council’s Finance Committee. “As we address these issues, we must also continue prioritizing gun violence and public safety issues.”
“I’m proud of the progress we’ve made to prioritize tax relief for our local businesses and residents at a time when Philadelphians and businesses are feeling financially squeezed from rising prices at every turn,” said Councilmember Allan Domb (At Large), chair of Council’s Fiscal Stability and Intergovernmental Cooperation Committee.
“The 2023 Budget agreement made by Council members represents investments in Philadelphia to move our city forward,” said City Councilmember Kenyatta Johnson (2nd District), chairman of Council’s Special Committee on Gun Violence Prevention. “This budget continues to increase the amount of money that is being invested with boots-on-the-ground organizations to reduce violence in our communities. Council also approved major portions of my ‘Save Our Homes’ 2022 Property Tax relief plan that will help reduce the property tax burden for homeowners.”
Council took other actions in the budget that received preliminary approval tonight, including adding $15 Million for rental assistance – a critical issue during the pandemic, and just over $1 Million for eviction protection and right to counsel. The city’s Cultural Fund will receive an additional $1 Million, and the Free Library will receive $2.6 Million in funds above the mayor’s proposed budget. Asbestos inspections at School District buildings will receive an extra $2 Million, and the City Commissioners will receive $6 Million more.
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