Pittsburgh Public Schools is weighing whether to bring Allegheny County to court in an attempt to compel a countywide property reassessment.
The move comes as a number of Downtown office buildings have sought, and won, lower tax assessments in the wake of the coronavirus pandemic and court-mandated changes to how properties are valued. The district has been forced to hand back more than $10 million in real estate revenue over the past several months, according to district solicitor Ira Weiss.
With a backlog of other assessment appeals at the county, Weiss said the district is facing an “assessment crisis,” adding that it wouldn’t be long before that number increases to $20 million.
The deadline to file assessment appeals for the 2024 tax year is March 31.
“It's just bleeding money and it's also diminishing the tax base for the future,” Weiss told WESA. “Into the future, there will be a lower tax base with diminished revenue. I mean, the water is circling the drain.”
Whether the school board will authorize Weiss to commence an action is unclear, though Weiss said he has recommended they do so “in as unequivocal a way that I can.”
Weiss' grievance with the county lies in its use of the Common Level Ratio, a state measure used to reconcile current market values with those calculated in the last assessment. In 2022, a Common Pleas Court ruling ordered that the county's ratio be reduced from 81.1% to 63.53%, meaning that its value for tax purposes would be set at 63.53% of its present value.
That number dropped to 54.6% at the start of this year, a change Weiss says will erode the tax base further. According to the resolution presented to the school board Wednesday, that has allowed high-value properties to receive artificially low assessments through the litigation process.
“Major property owners downtown are exploiting the system here to file an appeal and get a reduction,” Weiss alleged.
Office buildings have been hurt by work-from-home policies that have left empty space since the coronavirus struck. In January, three large downtown property owners — the Tower at PNC Plaza, the U.S. Steel Tower and Three Gateway Center — each won their assessment appeals, representing a combined $200 million in reduced tax revenues across all tax bodies.
The resolution would, if passed, authorize the solicitor to “commence an action” in the Allegheny County Court of Common Pleas, and “provide notice to all taxing bodies in the County to seek their intervention in the action.”
If voted forward, the district would base its lawsuit on the state constitution’s uniformity clause, which the Pew Charitable Trusts states requires “all local and state taxes be flat, with the same percentage applied to all taxpayers or properties."
A 2011 Pennsylvania Supreme Court ruling deemed Allegheny County’s real estate tax system unconstitutional given that it produced non-uniform tax burdens for owners of similar properties. That led to the county’s 2012 reassessment, though one has not been conducted since then.
Weiss said that by failing to reassess properties, the county has created a landscape that overburdens low-income taxpayers by failing to increase taxes for higher-value properties.
“And the irony of all this is that even though the residential properties are the ones that sort of drive the ratio, because there are so many sales, as you're seeing now, these property owners in the core of downtown, they are benefiting from that,” Weiss said.
If the measure passes, Weiss suggested that the board reach out to County Executive Sara Innamorato first about a voluntary reassessment. It’s a move favored by school board president Gene Walker.
“If and when this passes, I think it's an important step to make sure that, you know, we have open lines of communication,” Walker told the board Wednesday. “And if we can get something done sooner rather than later and save some time on legal expenses and courtroom — you know, that kind of stuff — the better.”
The county executive’s office declined to immediately comment.
Innamorato initially campaigned last year on a pledge to undertake a countywide reassessment, a move she said would address inequities in the current system.
Later in the election cycle, however, she stepped back from the pledge, saying that she would consider a reassessment if a broader look at tax policy said doing so was necessary.
