Councilman: Schools should have final say in tax abatement dispute

City Council Philadelphia
Councilman Wilson Goode Jr. thinks the state-run School Reform Commission should have the final say over whether the 10-year tax abatement continues for the portion of revenue that goes to Philadelphia schools.
Credit: Richard Larma/Metro

In the latest development in his ongoing attempt to reform the city’s 10-year property tax abatement, Councilman Wilson Goode Jr. will today introduce a bill leaving it up to the state-run School Reform Commission to decide whether the abatement should apply to the portion of real estate taxes that go to Philadelphia schools.

The city currently extends the property tax abatement to new construction or improvements in an attempt to spur new development.

But since revenue from those real estate taxes are split between the city and the state-run city school system, critics have argued the abatement should be modified in light of both entities’ fiscal struggles.

Goode last month withdrew a proposal that would have capped the abatement and reduced it over the final 5 years.

He instead introduced legislation that would end the abatement for the portion of tax revenue that goes to city schools.

That bill has yet to undergo a committee hearing, but its introduction drew mixed reactions from fellow councilmembers.

Under Goode’s latest legislation, the SRC and city would be treated as separate taxing authorities.

The bill would require the SRC to by June 30, 2014, either approve the continuation of the abatement of the portion of real estate taxes that go to schools, or to remove that portion of abated taxes.

“In light of the statute, which treats each taxing authority separately, and the extraordinary fiscal crisis facing the school district, the School Reform Commission should have the opportunity and responsibility to terminate – or explicitly authorize – each of the existing tax exemptions from school district real estate taxes,” Goode said in a statement.

“The SRC should address the tax abatement similarly to other tax exemptions, such as tax increment financing projects and Keystone Opportunity Zones.”



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