10-Year Tax Abatement Continues Amidst Aggressive Tax Collection from Longtime Residents

Today 23,000 Philadelphia residents and business ownerswill receive notices informing them of the city' attempt to collect on delinquent taxes as part of what Mayor Street dubbed "the city' most aggressive" tax collection initiative so far.

Street tried to keep the focus of last Friday's press conference off of tax collection and on the need of city schools, which the mayor claims will receive more than half of themoney collected from this initiative. However, ending the 10-year tax abatement program, enjoyed mostly byhigh-end developers and residents, was not considered as part of the Mayor's plan to rescue city the school district.

With arrival of the notices, taxpayers must pay 25% of the delinquent taxes up front and the remaining balance over the course of the year. Those who wait until a foreclosure notice arrives will be forced to pay 50% of the back taxes up front with one year to pay the rest or lose their properties.

Foreclosure filings will begin "as early as November. Court hearings could begin by January. Sheriff sales could be held by next May." said City Solicitor Romulo Diaz to a reporter who was concerned that the sheriff sale process normally moves to slowly.

Of the $235 million that the city is seeking to collect, the Mayor plans to set aside $1.5 million to fund what he calls a "safety net" for those who can not afford to pay. None of this money will be used to assist taxpayers with their payments, but will instead be used to fund support services for counseling agencies and to create loans for those trying to pay their taxes. There will be no tax forgiveness for Philadelphians as part of this initiative.

The highest concentration of properties that the city is targeting are in North Philadelphia west of Broad Street and Southwest Philadelphia.

When asked if his office would consider ending the 10-year tax abatement program, Street told reporters that tax abatement had nothing to do with this initiative and did not seem to know what kind of revenue the city could see with the end of tax abatement. Thetax abatementprogram allows new construction projects (including total rehab) to evade paying property taxes for ten years. If the property is sold, the tax abatement will be passed on to the next owner for what remains of the ten years.

Though the Mayor is not interested in collecting property taxes from developers and new condo owners in the city, he did insists that "the number of people and businesses who do not pay their delinquent business and property taxes is unacceptable... Everyone must pay their taxes."

People receiving notices are advised by the Mayor' office to call a taxpayer assistant at 215-790-1117. Walk-in appointments will be taken at the city' tax collection agency, Linebarger Goggan Blair & Sampson between the hours of 8:30am to 5:00 pm Monday through Friday at 4 Penn Center or 1600 JFK Boulevard.

Philadelphia Inquirer Article at:

http://www.philly.com/inquirer/local/philadelphia/20070907_City_plans_to_go_aggressively_after_back_taxes.html