(Philadelphia, Pa. June 22, 2022) – Councilmember Kenyatta Johnson (2nd District) and community groups are pushing for final passage of all seven points of the “Save Our Homes” property tax relief plan at Philadelphia City Council’s June 23 meeting, the final meeting before Council’s summer recess.
The goal of the Save Our Homes plan is to reduce displacement, making property taxes fairer and more transparent. It is also revenue neutral. The Save Our Homes plan will simply take new revenue that is expected from increased property assessments and give it back to Philadelphians.
“The City’s Office of Property Assessment (OPA) announced in May that property assessments for Tax Year 2023 are going up by an average of 31% citywide,” Johnson said. “In some neighborhoods, assessments have doubled. Increases are highest in low-income Black and Brown neighborhoods. Massive displacement is a real threat. But it doesn’t have to be that way. With the support and collaboration of my Council colleagues, the Save Our Homes property tax relief plan is a package of solutions that will benefit homeowners and renters throughout Philadelphia. I’m proud to have at least 12 Councilmembers as co-sponsors of all four of the bills in this package.”
In addition to supermajority support in Council, the Save Our Homes property tax relief plan has support from Community Legal Services (CLS), which assists clients when they face the threat of losing their homes, incomes, health care, and even their families.
“If we don’t expand relief programs, higher property tax bills will hit homeowners hard at a time when people are still reeling from the economic crisis of the pandemic,” said Jonathan Sgro, CLS Supervising Attorney/Homeownership and Consumer Rights Unit. “With families and seniors already struggling to pay their mortgages, many homeowners are at risk of losing their homes. We are so grateful to Councilmember Kenyatta Johnson and the City Council members who are supporting this legislation to prevent homelessness and preserve intergenerational wealth. Expanding access to these programs is a huge step forward in ensuring Philadelphia homeowners get the help they need.”
Councilmember Johnson, who represents parts of South and Southwest Philadelphia and Center City, introduced the Save Our Homes plan on May 26.
He originally announced his intention to amend his Bill No. 200012 (introduced in 2020, before the COVID-19 Pandemic struck) to double the city’s Homestead Exclusion from the current $45,000 up to $90,000. Mayor Jim Kenney’s Administration had introduced legislation to Council to increase the Homestead Exclusion to $65,000.
After hearing concerns from the School District of Philadelphia about a loss of tax revenue with the Homestead Exclusion going up to $90,000, the Kenney Administration and Councilmembers agreed to an $80,000 Homestead Exclusion Bill No. 200012 is scheduled for a final vote on June 23.
If Bill No. 200012 is approved by Council and signed into law by Mayor Kenney, this will mean $80,000 of a property’s assessed value would be exempted from property taxes. According to OPA’s 2023 data, $189,800 is the median market value for Philadelphia owner-occupied homes.
For a Philadelphia homeowner, the increase in the Homestead Exemption to $80,000 means an annual savings of $1,119 on next year’s property taxes, much higher than the average savings of $629 a year today.
Once the City of Philadelphia accepts a Homestead application, that person never has to reapply for the exemption. The person receives property tax savings every year, as long as the person continues to own and live in the property.
Councilmember Johnson is also the prime sponsor of three additional bills that are part of the Save Our Homes Tax Property Tax Relief plan. The bills would expand the City’s Senior Tax Freeze program (Bill No. 220499) and Longtime Owner Occupants Program (Bill No. 220497), and also increase the OPA’s transparency obligations.
The Senior Citizen Property Tax Freeze program low-income senior citizens, age 65 or older, to permanently freeze their property assessments. To be eligible at this time, a person’s income must be $33,500 per year or less for a single person or $41,500 per year or less for a married couple.
Under Johnson’s Save Our Homes property tax relief plan, eligible seniors would have the chance to retroactively enroll in Senior Tax Freeze. Accordingly, those seniors will only pay taxes on their assessment from the year they first became eligible, going as far back as 2018. Bill No. 220499 comes up for final passage on June 23.
The Longtime Owner Occupants Program (LOOP) is a City program for longtime low- and mid-income homeowners whose property assessments increase by 50% or more in just one year.
Under the Save Our Homes plan, eligibility for LOOP would be expanded significantly. First, the bill would fix the current regressive formula for calculating assessment increases. Second, it would allow an alternative path into LOOP for homeowners who don’t meet the 50% threshold, but have large, sustained assessment increases over a five-year period.
The LOOP budget was $25 million this year. Mayor Kenney proposed in his original budget to increase it to $30 million. After negotiations between Council and administration, the LOOP budget will be increased to $35 million in Fiscal Year 2023. Bill No. 220497 will receive a final vote on June 23.
The final bill (Bill No. 220498) that is part of Councilmember Johnson’s Save Our Homes property tax relief plan would require OPA to provide prompt disclosure of re-assessment data to City Council. The OPA disclosure bill will get a hearing in the Committee on Law and Government when Council returns to session in September.
The Save Our Homes plan also includes amendments to the proposed Fiscal Year 2023 operating budget introduced by Mayor Kenney on March 31. After negotiations between Council and the Kenney Administration, the operating budget that is up for final passage on June 23 would include the following:
Expand Rental Assistance:
• Allocate $15 million for the City’s rental assistance program.
Councilmember Johnson knows that rising property taxes will inevitably get passed on to renters as rent increases. Moreover, Philadelphia’s highly successful rental assistance program, which was funded by federal pandemic relief, has run out of money.
Expand Community Outreach:
• Allocate $2.5 million in Council’s operating budget for taxpayer awareness and assistance programs, such as advertising, mailers, community events, and other efforts. Councilmember Johnson asked for $2.5 million
Anti-displacement Legal Services
• Allocate $1 million for legal counsel to low-income Philadelphians in cases involving landlord-tenant disputes and other housing matters exacerbated by increased assessments.
Councilmember Johnson is the prime sponsor of the Save Our Homes property tax relief plan, but his legislation also has the support of 12 or more additional members of Council.
The 12 members are: Councilmembers Mark Squilla (1st District), Jamie R. Gauthier (3rd District), Curtis Jones, Jr.(4th District), Maria Quiñones Sánchez (7th District), Cindy Bass (8th District), Cherelle L. Parker (9th District), and At-Large Councilmembers Kendra Brooks, Derek Green, Helen Gym, Katherine Gilmore Richardson and Isaiah Thomas.
The Fiscal Year 2023 operating budget must be approved by Council and signed into law by Mayor Kenney by June 30. Fiscal Year 2023 starts July 1.