Property tax revaluation raises question of whether property taxes should fund schools
3/14/2013 | Real Estate Blog
An interesting angle has arisen in regard to the recent increase in Property Tax Assessments this year. That angle involves public school teachers and planned cuts to teacher contacts in the City of Philadelphia. Under the plan, the district would cut pay up to 13 percent, require longer work days and put no limit on class sizes. In addition, the district would not provide teachers with copy machines, desks or even enough instructional materials and textbooks. Why is the district proposing the plan now? Because of a budget crisis that could get worse with forced spending cuts. Like most states
Like most states, Pennsylvania uses property taxes for school funding. As our readers know, this approach is controversial as it means that less affluent areas have to stretch further to meet costs and because markets are sensitive to trends, and to that extent unreliable. This, in fact, was the reason behind the recent change in how property taxes are assessed in Philadelphia.
Philadelphia’s recent reassessment of property tax valuations was intended to address problems with the old system, which resulted in variations in assessed values during the city’s resurgence in real estate health. This made efforts to collect sufficient revenues impossible.
The new valuation system, it is estimated, has resulted in increased valuations for between 60 and 75 percent of property owners. The City, going forward, intends to conduct annual assessment to determine if changes in the market or other factors require additional changes.
As a recent Forbes article pointed out, the revaluation of property values may, in the end, make it more possible for the Philadelphia School District to meet its budget, but it does raise the question of whether property taxes should be the basis of school funding in the first place.
Source: Forbes, “Philadelphia Battle Over Property Tax Assessments Raises Questions About Funding Public Schools,” Kelly Phillips Erb, March 6, 2013