The Pittsburgh Public Schools board next week will vote on a property tax millage change that would decrease the millage rate by about one-third, but increases the revenue the school district will receive.
The school board is required to reduce the millage rate to reflect the increase in assessed property value as a result of the recent countywide reassessment. The district is not permitted to reap a windfall on the increased values, but it can increase revenue by up to 1.7 percent under what is known as the Act 1 index. The proposal calls for using the 1.7 percent to set up a fund for pending property assessment appeals.
At an agenda review meeting tonight, the board reviewed the proposal to reduce the property tax millage rate from 13.92 mills to 9.65 mills. This would result in $3.2 million additional revenue for the appeals. District officials have estimated that pending appeals could cost the district as much as $3.6 million.
In addition, the board is poised to increase the homestead and farmstead exemption from $19,937 in 2012 to $28,685 in 2013. This permits property owners who meet certain conditions to be exempt from property taxes for that portion of their property value.
Whether the taxes of an individual property taxpayer go up or down depends on the final result of the property reassessment. Overall, property values in the city went up 48 percent. If the value of a particular property went up more than that, taxes will increase. Taxes will decrease if the value went up less than that.
One mill amounts to $1 of tax for each $1,000 of taxable property value.
District officials have been concerned about the impact of appeals because the district already is anticipating a deficit in 2013.
If a homeowner's house had an assessed value of $100,000 after any applicable homestead exemption, he or she would have paid $1,392 in property taxes. If the property value was unchanged in the reassessment, the taxpayer would pay $965 under the new rate.
At the proposed rate, the property tax would generate $194.1 million for the district. Last month, the board passed a $521 million budget for 2013.
Most school districts budget on a school year, but Pittsburgh uses a calendar year.
Education writer Eleanor Chute: email@example.com or 412-263-1955.