An analysis by Allegheny County Controller Chelsa Wagner has shown the county could be on track to overcharge the average household by $50 in property taxes in 2013.
“There is a strong possibility, from the data we have analyzed, that the county is on track to gain a windfall of as much as $38 million," Wagner said in a statement issued Thursday.
“I am calling on the administration to publicize every detail of their millage calculation to assure all taxpayers that no windfall will occur. No resident of Allegheny County should be overcharged one cent or $1, let alone $50 or more for the county’s failure to act.”
She also expressed concern over the lack of transparency and available information surrounding the county’s current, adopted 2013 millage rate. Wagner urged immediate action by County Executive Rich Fitzgerald and Allegheny County Council to protect taxpayers and avoid breaking state law.
In December 2012, county council lowered the tax rate for county property owners to 4.73 mills. That rate, which Wagner referred to as “arbitrary or preliminary at best,” was adopted prior to the county’s receipt of certified assessed values of all county properties, which were completed in late December.
While the pre-reassessment value was $59 billion, Wagner said these values revealed a total taxable property value of $80 billion. She questioned why the county did not adjust its millage after the release of the final values, like other taxing bodies.
The City of Pittsburgh decreased its millage rate by 29 percent and the Pittsburgh Public Schools lowered its rate by 31 percent to avoid windfalls.
State law prevents municipalities from receiving monetary gains or “windfall” from a reassessment.
Wagner said she believes the county millage rate should be adjusted down by as much as 0.5 mills to a rate of 4.23 mills to comply with the law. A rate of 4.23 mills would represent an overall county reduction of 26 percent.
Using the current assessed valuation of $79.6 billion, which includes adjustments from appeals already conducted, and the current millage of 4.73, Allegheny County is on target to take in $361.6 million of revenue—$38.2 million higher than revenues in 2012.
By using Wagner’s proposed rate of 4.23 mills, the county could keep revenue in line with 2012’s property tax revenue of $323 million. The additional reduction of 0.5 mills translates to $50 in county taxes returned to taxpayers for every $100,000 of assessed property value.
“Fifty dollars is a few family meals, a tank of gas or two weeks’ worth of bus fare," Wagner said. "This is a very significant amount for any taxpayer. Frankly no amount is insignificant, but an average of $50 per household is outrageous.”
Wagner said the issue boils down to fairness and transparency.
"Taxpayers are entitled to know, in no uncertain terms, that there will be no windfall in accordance with state law that is in place to protect them. Very simply, we deserve some answers.”
In the coming weeks, Wagner said she will revive a previous controller’s program called "Windfall Watch." Initiated by former Controller Dan Onorato during the last reassessment process, Wagner will track millage rates for every municipality and school district in the county to ensure all rates are adopted in accordance with all state and local laws.
Later Thursday, Fitzgerald held a news conference to address Wagner's concern. He said he remains confident in his proposed millage rate that was approved overwhelmingly by Allegheny County Council.
The nature of the process requires assumptions and estimates to set the millage rate, but the numbers used are based on historic data and previous numbers, he said.
The chief executive said the process used was open and transparent. At county council’s November budget and finance committee meeting, county Manager William D. McKain and Budget Director Warren Finkel presented the calculations and final recommendation in full detail, Fitzgerald said.
Wagner also attended that commitee meeting, Fitzgerald noted. McKain and Szymanski also answered all questions posed by council and met individually with council members, as requested, he said.