Lawsuit alleges Pa. property assessments discriminate against low-income owners

Mon Valley Unemployed Committee Inc. is suing the commonwealth, Gov. Josh Shapiro and Attorney General David Sunday.

By PAULA REED WARD
TribLive

A lawsuit filed in Pennsylvania’s Commonwealth Court alleges that the state’s property tax assessment scheme is unconstitutional, harming low income homeowners who are typically overassessed.

Filed by Mon Valley Unemployed Committee Inc., the complaint names as defendants the commonwealth, Gov. Josh Shapiro and Attorney General David Sunday.

“The General Assembly’s failure to enact basic principles governing how counties must assess Pennsylvania properties has resulted in a haphazard, grossly nonuniform, and arbitrary property assessment system across the commonwealth,” the lawsuit said.

It seeks to have the statutes declared unconstitutional, as well as an injunction requiring Pennsylvania’s counties to assess their properties in accordance with the law.

The attorney general’s office hasn’t been served with the complaint but the civil litigation division of the office will defend the office from the claims in the suit, according to a spokesperson.

Several lawsuits challenging Allegheny County’s property assessment scheme have been filed in recent years. One initiated by Pittsburgh Public Schools last year was thrown out after a judge said the district did not have standing.

Others have been filed by individual homeowners and are working their way through the court system.

According to the lawsuit, the plaintiff is a nonprofit organization that assists unemployed workers, including by helping them maintain their housing.

The Mon Valley Unemployed Committee, which is being represented in the lawsuit by the Community Justice Project, has about 450 members, including homeowners in Allegheny and Westmoreland counties.

Among its members are those whose homes are systematically overassessed because of the use of the frozen base-year assessment scheme. The lawsuit cites as an example a member from Westmoreland County whose home is assessed at roughly double the amount it should be based on its current market value.

Under the current system, the lawsuit said, lower-value properties are overassessed, while higher-value properties are underassessed, leading to disparity among property owners.

The current system of delegating the assessment process to individual counties — without funding or oversight or standards — violates state law, the complaint said.

“Equally important, the Pennsylvania Assessment Laws contain no meaningful standards guiding or restraining how counties should implement the base year scheme, leaving it to each individual county to decide whether, how often, and how to conduct property reassessments to update the base year,” the lawsuit said.

In most cases, the complaint said, frozen base year assessments are used for decades — and in 50 counties in Pennsylvania, the base year is 15 years or older. Some, the lawsuit said, date back to the 1960s and 1970s. According to the Pennsylvania Supreme Court, 22 states require annual reassessments, while 26 permit assessments to be conducted at intervals over one year.

“‘Pennsylvania is the only state where legislation allows the use of a base year indefinitely,’” the lawsuit said. “Freezing property assessments at base year values necessarily exempts from taxation all appreciation in property values that occurs after the base year.”

Further, once a municipality has reached the statutory cap on raising millage rates, they are forced to cut back on services — harming the community.

“This leaves municipalities and school districts in a bind, because they do not control when the county decides to conduct a reassessment,” the lawsuit said. “The General Assembly’s delegation of legislative authority to the counties thus arbitrarily limits the basic governmental services that many taxing authorities may offer and that their residents may, in turn, receive.”