Saturday, November 11, 2006

Mt. Lebanon Holds Line On Taxes

For the first time in recent history, Mt. Lebanon's municipal manager has submitted to commissioners a budget that does not call for any increase in services, and as proposed, no tax increase for residents.

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Anonymous Anonymous said...

This is great for the residents. Let's hope the Schools can do the same thing, however, that is doubtful. It will probably be business as usual.

As for the assessments. It clearly says on the Allegheny County website that we are using a 2002 base year system instead of the usual reassessing every 3 years.

That means if somebody buys a house now, it should be assessed at the year 2002 price (instead of a double-whammy of taxing them at the 2006 price) What is the 2002 price? Shouldn't be too hard to find out.

November 13, 2006 8:05 AM  
Blogger joe wertheim said...

If "somebody buys a house now" it should be assessed at the sale price. The buyer has made an offer based on his determination of the VALUE of the home. This is far more accurate than some subjective determination that is 4 years old!! If you don't like the amount of the taxes, or can't afford them, then don't make the offer. My taxes should not be used to subsidize those who have bought houses, and paid far more than the assessed value, during the past four years.

November 13, 2006 5:00 PM  
Anonymous Anonymous said...

OK Joe, so Allegheny County changes to a base year system, and you think Lebo should opt out? It sounds like that is what you are saying. Opting out means constant growth of Government without oversight. Taxes are raised based on the 2002 price. They are raised for everybody.

Sales price is market price (or as you put it the VALUE of a home). It is no longer considered the assessed price to Allegheny County. If they start assessing at sales price again (along with raising taxes against the 2002 assessed price), housing prices will drop considerably.

A Base year system is very fair. Look around Mt. Lebanon. You see $500K homes being assessed at $180K, while $250K homes are being assessed at $250K. You are subsidizing the $500K home (unless you are the one living there)

You talk about not wanting to subsidize new home owners, but you want new home owners to subsidize you because you lived in your home for 20 years.

The base year system works in lots of places. Taxes are based on that year. It is as fair as you can get. When they raise taxes, they raise for all.

Also, those homes in your neighborhood that may have sold for $300K this year, wouldn't have without this base year system.

November 14, 2006 8:18 AM  
Anonymous Anonymous said...

Mr. Wertheim:

Would you be willing to sell your house today for your assessed value? If your answer is "yes", then you are fairly assessed. If your answer is "no", then like 90% of Mt. Lebanon residents, your home is under-assessed.

Only those homes purchased between 2002-2005 are assessed at market value. They are actually over-assessed because interest rates were much lower during that four year period and Mt. Lebanon prices were extremely high and have already dropped. One Mt. Lebanon family that purchased a home in 2002 saw their taxes jump 105%. They decided they could not afford to live in Mt. Lebanon and put their house on the market in 2004. The house took two years to sell and the family took a $65,000 loss just to sell their house and get out of Mt. Lebanon.

Beginning in 2002, the Mt. Lebanon Commissioners voted to appeal any home in Mt. Lebanon where the purchase price exceeded the assessed value by 15% or more. They appealed about 1000 homes and won increases on nearly all of them. Homeowners didn't stand a chance because assessed value equaled market value. It was hard to argue that your house wasn't worth what you paid for it because you had just purchased it.

One problem was that Mt. Lebanon did not appeal every home that fit the 15% criteria. Some new homeowners were missed while other homeowners received huge tax increases. (The Commissioners called this a "computer glitch".) New homeowners saw their tax bill jump from $5,000 to $10,000 or $10,000 to $20,000 overnight. The new homeowners were also back-taxed from the minute they purchased their property.

Another problem was that the Mt. Lebanon Commissioners appealed homes because they said they were trying to make things "FAIR". They thought market value was a fair way to assess property and that Mt. Lebanon would be more fairly taxed by reassessing new homeowners. If that was the rationale, then new homeowners who purchased homes that were over-assessed should have been appealed in the name of FAIRNESS. One new homeowner purchased a home for $200,000 and the assessed value was $250,000. Mt. Lebanon continued to collect taxes based on the $250,000 value. That was not fair. One Municipal employee said it would not make sense to appeal over-assessed homes because Mt. Lebanon would have lost money. It might not have made sense, but it would have been FAIR.

The greatest problem with the appeal process was that Mt. Lebanon has never appealed homes with renovations or additions. They simply pass on the builing permit to Allegheny County and years later the County catches up with the homes that had additions. There are literally new homeowners in Mt. Lebanon living in 1500 square foot homes paying more in taxes than those in 4500 square foot homes. The 4500 square foot home had a huge addition built two years ago and still has not been re-assessed by the county.

Mt. Lebanon School District and Municipality took in a WINDFALL of over $3 million from the new homeowners. Suprisingly the millage never decreased! The new homeowners literally paid for the Margery Sable buyout more at least 4 times.

The Mt. Lebanon Commissioners started this discrimination, but apparently the Mt. Lebanon School Board continues to believe new homeowners should pay twice as much as everyone else. Even though the Commissioners voted last March not to challenge 2006 appeals by new homeowners, the Mt. Lebanon School Board decided to challenge the new homeowners on their own in late September, 2006.

They also decided to challenge the remaining appeals even though at least 25% of the appeals were heard without a challenge in August and September. Many of the appeals that were unchallenged were in Virginia Manor, Mission Hills and the Markham neighborhood. Those families will most likely receive full refunds for 2006 while the rest of the new homeowners will not. All new homeowners are entitled to full refunds for 2006, but only those lucky enough to have their 2006 appeals scheduled in August and early September will receive them.

The new homeowners cannot get refunded for the taxes over-paid in 2002, 2003, 2004, or 2005. They can only be refunded for taxes over-paid in 2006. Mt. Lebanon forced the new homeowners to over-pay taxes and now they have no recourse!

GREED is the only reason the School Board is now challenging the remaining appeals.

The sad truth is that the appeal process has forced families out of Mt. Lebanon. Those families that have stayed have had to take out loans and take on second jobs in order to pay their taxes.

Mt. Lebanon has lost tons of families and people are now afraid to move to our town. Property values will continue to drop because of this.

One interesting point: All Mt. Lebanon School Directors and Commissioners are assessed at a 2002 level. No wonder they don't care. How sad for the future of Mt. Lebanon.

Thanks for the forum to express concerns about Mt. Lebanon.

*Mary Niederberger and Laura Pace have written very good articles in the Pittsburgh Post-Gazette detailing the flaws of the Mt. Lebanon appeal process.

November 19, 2006 10:43 AM  
Anonymous Anonymous said...

I agree with anonymous (all 3!)

I just moved here and looked at homes. For the most part, I bypassed any homes that were purchased since 2002. All of their taxes were obsurdly high. These houses ended up going for a lot less than they should have if they were assessed properly. (or they are still for sale)

I would look at the house, see the $8K-$12K in taxes, and say, "next."

I think most Allegheny County residents are against the 2002 assessments because they are "locked in" to the earlier assessments. Little do they know that their assessments would have gone up 20% by Allegheny County if the 2002 base year law didn't pass. (20% based on Post Gazette articles).

Also, many residents see assessing at sales price is fair because that is what happened to them when they bought the house.

Either way, residents should realize that if they started assessing at sales price, everybody's house will go down in value.

November 20, 2006 9:18 AM  

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