Tax break may be coming for Wilkinsburg home buyers/owners (Pittsburgh: homes, property tax)

[BrianTH]

Here is the story:

Wilkinsburg Home buyers may get tax break

By way of background, Wilkinsburg is basically following the recommendations of a 2007 CMU study. The CMU study found that although Wilkinsburg's property tax rate was the highest in Allegheny County, its property taxes collected were only average, thanks to the low tax base. So, the study concluded that Wilkinsburg was in a "tax trap", because lowering tax rates would require cuts in municipal services that would make Wilkinsburg less desirable, thereby cancelling out the benefits of a lower tax rate. Accordingly, the study recommended increasing the tax base before cutting tax rates, and among other things it recommended a tax abatement program for people making improvements in their properties.

Wilkinsburg had done this earlier for commercial properties, but is now set to do it for residential properties as well. As I understand it, if you improve a property (including a newly-bought property), you will get a ten-year abatement in your assessment for the improvements, which will work by adding in 10% a year until you reach the full 100% at the conclusion of the program. The idea is that this will encourage people to invest in Wilkinsburg properties now, with the plan to be to lower the property tax rate on the increased base by the time the abatements would be phased out.

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[BrianTH]

By the way, the Pittsburgh History & Landmarks Foundation has apparently secured another $2 million in funding for Phase II of its Hamnett Place home project. They apparently plan to prepare 17 "shell homes", which means taking homes with historical significance and stabilizing the structure, roof, floors, plumbing, and so on, then selling them at market rates to buyers for custom finishing (they plan to provide ongoing support during the finishing process through a Housing Resource Center).

So if the proposed residential tax abatement goes through, obviously it would enhance the value of these "shell homes" for potential buyers, since whatever investments they made in finishing the homes would only show up gradually in their assessments.