City Council’s recently passed AVI legislation includes a “Gentrification Protection” provision.
(We’ll explain other aspects of AVI in future emails.)
WHO DOES IT PROTECT?
Long-term homeowners (details below).
WHAT DOES IT ACTUALLY DO?
Instead of taxing your property based on your full new AVI assessment, it taxes your property based on an assessment that’s three times your old, pre-AVI assessment. Based on current tax rates, this effectively limits the tax-bill increase to 29% for those who qualify.
HOW LONG DOES IT LAST?
Ten years: tax years 2014-2023.
HOW CAN I TELL IF I QUALIFY?
You qualify if you can answer Yes to these two questions:
(1) Have you owned & lived in your house since July 1, ’03?
(2) Is your annual household income below the following?
Household of 1 person: $83,160
Household of 2: $95,040
Household of 3: $106,920
Household of 4: $118,800
Household of 5: $128,300
Household of 6: $137,810
HOW DO I SIGN UP?
The City will create a form and a process soon. Because it is income-based, you’ll have to re-apply each year.
CAN YOU GIVE ME AN EXAMPLE OF THE TAX SAVINGS?
A not-uncommon Northern Liberties scenario: A house has had a pre-AVI “market value” of $50,000. Under AVI, the assessed market value has gone way up, to $400,000.
– The 2013, pre-AVI tax bill for that house, based on the $50k assessment: $1,565.
– The 2014 AVI tax bill, WITHOUT gentrification protection: $4,958 – an increase of 217% from 2013.
– The 2014 AVI tax bill WITH Gentrification Protection: $2,010 – an increase of 29% from 2013.
It’s so much less because Gentrification Protection limits the taxable assessment to 3X the old assessment ($50,000 x 3 = $150k), rather than the full new AVI assessment ($400k).