New PA Supreme Court Assessment Ruling

This Pittsburgh Tribune-Review article discusses the recent state Supreme Court ruling that Allegheny County must reassess because it is taxing homes based on their 2002 worth, which is no longer accurate. With over 500,000 homes in the county, which includes Pittsburgh, the cost of reassessment is estimated to exceed $40 million.

The ruling is causing a lot of concern in the western counties near Pittsburgh. But should we care in Susquehanna County? Maybe.

According to the article, Supreme Court Justice Max Baer's concurring opinion to the court's order suggested setting a statewide standard of how accurate assessments need to be. That could take the heat off local officials. Under Baer's proposal, Allegheny, Westmoreland and 57 other counties ( including Susquehanna) would need to reassess, according to state data.

I'll discuss possible "standards" in a bit, but first some good tidings. Chief Justice Ronald D. Castille wrote in the majority opinion that regulation is best left to the Legislature. And it seems the Legislature is not inclined to force reassessments on almost all counties in the current economic climate. So, we may be saved by political inertia; unless the courts decide to extend the reassessment ruling to all counties.

What statewide standard might be used to judge the accuracy ( or fairness) of assessments? The proposal seems to be to require the county Coefficient of Dispersion (COD) to be less than 20 or preferably less than 15. That standard makes most counties in need of reassessment.

The COD is a measure of the degree of nonuniformity in the ratio of assessed value to market value of properties within a jurisdiction. It is calculated as the average deviation of a group of numbers from the median expressed as a percentage of the median. The smaller the COD, the closer all assessment ratios are to the median value and the "fairer" the assessment process.

At least, that would be the case if market value could be determined accurately for properties. In fact, it is much harder to determine market value in rural areas with lots of high acreage parcels and low turnover than in cities with more uniform properties and high sales turnover.

At any rate, regardless of the accuracy, the state has a data table of each counties COD, at this website :http://www.steb.state.pa.us/Assessmain.asp?OptionCounty=ALLOptionChoice=Disp.

The table lists Huntingdon County at the highest COD of 51.8; and Cumberland County at the lowest COD of 13.1. The mid-point in this range, and also the median, is 32.5 - by definition, half the counties have CODs higher than the median and half have lower CODs. Susquehanna County is right at the median with a COD of 32.5. The five northern tier counties average COD is 31.3.

Allegheny County has a COD of 30.3 and the state Supreme court ruled that it must reassess - but remember that it is a relatively high density county with relatively uniform properties and high sales turnover. That is a very different case from the rural counties and the court's reasoning, being specific to Allegheny County, may not apply more broadly.

As to a statewide COD standard, that seems to be only a judicial suggestion without much legislative interest. Let's hope it stays that way.