City Council is backing a new property tax relief package to soften the impact of rising assessments for homeowners.

The "Save Our Homes" plan unveiled Thursday by Councilmember Kenyatta Johnson would increase the homestead exemption to $90,000, its maximum level under state law; expand the Senior Citizen Real Estate Tax Freeze program; add $12 million in funding for the rental assistance program; and make other investments to ensure property owners are aware of and can appeal their new assessments.

A veto-proof majority of Council has already signed on to the proposal, making it the body's most unified and substantial response to the news that residential valuations were rising 31% in the citywide reassessment Mayor Jim Kenney's administration released earlier this month.

Many of the sharpest increases were in working-class neighborhoods, sparking fear among lawmakers that skyrocketing property tax bills could force residents out of their homes.

The relief package is essentially a more aggressive version of the one Kenney proposed when the administration announced the results of the reassessment.

Kenney proposed increasing the homestead exemption - which reduces the assessment of owner-occupied homes when calculating tax bills - from the current $45,000 to $65,000; boosting funding for the Longtime Owner Occupant Program from $25 million to $30 million; and allocating an additional $40 million to a variety of programs that help people stay in their homes, including rental assistance and the senior tax freeze program.

Kenney also proposed using some of the new revenue generated by increased assessments to more aggressively cut the wage tax for city residents, from 3.8398% to 3.7% over two years. Council has yet to weigh in on that proposal.

Philadelphia's 1.3998% property tax rate - of which 55% is dedicated to the school district, and 45% to the city's general fund - is lower than most local governments, with the city relying instead on its unusually high wage tax. This year, the city projects it will take in $719 million in property tax revenue and $1.5 billion from the wage tax.

Johnson's proposal comes as Kenney and lawmakers dig in for budget negotiations. Kenney has proposed a $5.6 billion budget that includes a 5.5% increase in spending spread out across city government, stretches out the city's $1.4 billion in federal pandemic relief aid over several years, and leaves the property tax rate unchanged.

With tax revenue rebounding after declines caused by the pandemic, the stability of the current $5.4 billion budget continues to improve throughout the year. The city's latest financial report projects a year-end fund balance of $389.9 million, which is $155 million higher than the previous projection.

That gives lawmakers more wiggle room as they seek ways to blunt the impact of the reassessment, the first in three years following delays caused by the coronavirus pandemic and difficulties the Office of Property Assessment faced while implementing its new Computer-Assisted Mass Appraisal system.

Councilmember Jamie Gauthier has suggested lowering the property tax rate. Councilmember Isaiah Thomas has proposed changing the city's tax structure by quickening the pace of wage tax cuts while allowing property tax revenue to rise. And Councilmember Mark Squilla has floated the possibility of delaying the implementation of the reassessment.

But the momentum appears to be with Johnson's proposal. Three bills introduced by Johnson on Thursday already have the backing of 13 of Council's 16 members. Only Council President Darrell L. Clarke and Councilmembers Allan Domb and Brian J. O'Neill have not signed as cosponsors, but it's possible they may still support the plan.

The package also includes a measure aimed at increasing the transparency of the Office of Property Assessment, which is yet to publish citywide data from the reassessment despite posting the new valuations to a city website weeks ago.

swalsh@inquirer.com

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Staff writer Anna Orso contributed to this article.