§ 19-1305. Authorization for Installment Payment Agreements and Tax Foreclosure Prevention Programs, Waiving Additions to Tax and Abating Interest and Penalties Otherwise Due Pursuant to Section 19-1303, and Requiring Commencement of Enforcement Action.

(.1) The "Improvement of Deteriorating Real Property or Areas Tax Exemption Act", 1977, August 5, P.L. 167, No. 42, 72 P.S. §§ 4711-101 et seq., (hereinafter referred to as the "Act"), authorized local taxing authorities to exempt from real estate taxes the construction of certain new residential buildings in deteriorating areas under certain terms and conditions.

(.2) In accordance with the standards established by the Act, 72 P.S. § 4711-301, and based upon recommendations made in these standards and standards set forth in the act of May 24, 1945, P.L. 991, No. 385, 35 P.S. §§ 1701 et seq., known as the "Urban Redevelopment Law", for the determination of "blighted areas", and the Act of November 29, 1967, P.L. 636, No. 292, 62 P.S. §§ 2081 et seq., for the determination of "impoverished areas", as required by the Act, Council determines that the following areas of the City are "deteriorating areas" within the meaning of the Act:

(.a) The Council determines that all the wards of the City contain "Deteriorating Areas" as defined in Public Law 167, No. 42, enacted by the State Legislature in 1977, and codified as 72 P.S. §§ 4711-301 through 305, and are eligible for tax exemption under the Act.

(.3) The Act of May 22, 1933, P.L. 853, No. 155, as amended (hereinafter the "Temporary Tax Exemption Act"), has been amended to further provide for the temporary tax exemption for residential construction for a period not to exceed thirty (30) months from the first day of the month after which a building permit is issued or until occupied or conveyed to a bona fide purchaser.

(2) Definitions.

(a) Dwelling unit means a room or group of rooms located within a dwelling and forming a single habitable unit with facilities which are used or intended to be used for living, sleeping, cooking and eating.

(b) Residential construction means the building or erection of dwelling units, as defined above, upon vacant land or land specifically prepared to receive such structures.

(c) Eligible dwelling unit means a dwelling unit located in a single house, double house, duplex, townhouse, row house, apartment building, condominium unit or cooperative unit.

(d) Reporting period shall mean, for the first report submitted pursuant to subsection 19-1303.4(8), the period from February 1, 1983 to December 31, 1984, and for subsequent such reports, the calendar year immediately following the period covered by the most recent report.

(e) Applicant means any person who applies for a building permit or tax exemption pursuant to this Section, and, when the application and implementation of this Section so indicates, a builder, developer, taxpayer or other appropriate interested party.

(f) Delinquent City and School District of Philadelphia taxes, charges, fees, rents or claims. All City and School District of Philadelphia taxes, charges, fees, rents or claims not paid when due (including the failure of any employer to pay over to the City any wage taxes that were collected, or that should have been collected but for misclassification of workers) whether or not liens for such have been filed in the office of the prothonotary of the county, and shall include all penalties, additions, interest, and costs due on such delinquent taxes, charges, fees, rents or claims.

(3) Authorization of Exemptions.

(a) Persons undertaking residential construction of new dwelling units within the definition contained in this Section within any of the foregoing eligible areas, may apply for, and the Board of Revision of Taxes may grant, a real estate tax exemption upon such new residential construction in the amount and in the manner hereinafter provided on the condition that any exemption granted by the Board of Revision of Taxes shall be contingent upon the payment of delinquent taxes, charges, fees, rents or claims or compliance with any agreement to pay that he may have entered into pursuant hereto.

(b) The Board of Revision of Taxes shall extend to ten (10) years the term of any three (3) year real estate tax exemption issued pursuant to this Section 19-1303.4 upon any new residential construction for which a certificate of occupancy was issued after October 27, 1999.

(4) Exemption Amount.

(a) The exemption from real estate taxes shall be limited to that portion of the assessment valuation attributable to the cost of construction of the new eligible dwelling unit.

(b) The exemption from real estate taxes shall be limited to that construction for which an exemption has been requested in the manner set forth below, and for which a separate assessment has been made by the Board of Revision of Taxes.

(5) Exemption Schedule.

(a) With respect to applications for exemption initially applied for on or before December 31, 2021, one hundred percent (100%) of the assessable amount of the construction costs shall be exempted from real estate taxes for a period of ten years immediately following the date on which settlement is made, and a required certificate of use and occupancy is issued on an eligible dwelling unit. After the tenth year, the exemption shall terminate.

(b) With respect to applications for exemption initially applied for after December 31, 2021, the assessable amount of the construction costs shall be exempted from real estate taxes for a period of ten years immediately following the date on which settlement is made, and a required certificate of use and occupancy is issued on an eligible dwelling unit, as follows: one hundred percent (100%) of the assessable amount of the construction costs shall be exempted in the first year; ninety percent (90%) in the second year; eighty percent (80%) in the third year; seventy percent (70%) in the fourth year; sixty percent (60%) in the fifth year; fifty percent (50%) in the sixth year; forty percent (40%) in the seventh year; thirty percent (30%) in the eighth year; twenty percent (20%) in the ninth year; and ten percent (10%) in the tenth year. After the tenth year, the exemption shall terminate.

(c) The exemption from taxes granted under this ordinance shall be upon the property and shall not terminate upon the sale or exchange of the property, so long as the dwelling units retain their eligibility.

(d) If an eligible dwelling unit is granted tax exemption pursuant to this ordinance, the value of the improvement shall not, during the exemption period, be considered as a factor in assessing the value of other properties in the same area.

(6) Procedure for Obtaining Exemption.

(a) At the time a building permit for residential construction is applied for, the Department of Licenses and Inspections shall notify the applicant by a printed notice of the possibility of a tax exemption under this ordinance. Within sixty (60) days of the date that the building permit is issued, or within 365 days of the date that the certificate of occupancy of the property is issued provided that the certificate of occupancy is issued after March 1, 2000 and prior to June 30, 2002, the applicant shall apply to the Board of Revision of Taxes for an exemption. The application shall be upon forms prescribed by the Board of Revision of Taxes and must be filed within the specified time period.

(b) The Board of Revision of Taxes shall determine whether the exemption shall be granted. The Board of Revision of Taxes shall forward a copy of the approved request for exemption to the applicant. At the same time, the Board of Revision of Taxes shall notify the applicant that the grant of exemption is contingent upon the payment of delinquent taxes, charges, fees, rents or claims.

(c) The Board of Revision of Taxes in determining whether the exemption shall be granted shall inquire of the Department of Revenue of the City of Philadelphia whether the taxpayer is indebted to the City of Philadelphia or School District of Philadelphia for or on account of any delinquent taxes, charges, fees, rents or claims. The taxpayer shall provide to the Department such documentation as the Department shall require in order to determine whether there is any delinquency, including whether the taxpayer has paid over to the City all required wage taxes. The Board of Revision of Taxes shall withhold approval of the application until the taxpayer pays or enters into an agreement with the City of Philadelphia to pay the tax, charge, fee, rent or claim. The Board of Revision of Taxes shall withdraw approval where the taxpayer fails to pay delinquent taxes, charges, fees, rents or claims during the exemption period for failure to comply with his agreement to pay as provided herein. Any withholding or withdrawal of the exemption by the Board of Revision of Taxes pursuant to this subsection shall not be construed to stay the tolling of the exemption period for which a taxpayer would otherwise qualify.

(d) Upon completion of the construction, the applicant shall notify the Board of Revision of Taxes, so that the Board may assess the construction for the purpose of calculating the amount of assessment eligible for exemption. In order to determine the assessment valuation attributable to the cost of construction of the new eligible dwelling unit, the Board of Revision of Taxes shall assess separately the dwelling unit and the land upon which the new residential construction stands.

(e) The Board of Revision of Taxes shall notify the applicant of the amount of assessment eligible for exemption.

(f) In no event shall an exemption be granted for an eligible dwelling unit which has obtained and used, in whole or in part, another exemption under this Chapter.

(g) Appeals from the reassessment and the determination of the amount eligible for exemption may be taken by the City or by the applicant as provided by law.

(7) Reserved.

(8) Information Reports. The Board of Revision of Taxes shall report to the Council and the Mayor no later than March 1 of each year commencing in 1986:

(a) The number of tax exemption requests submitted and granted under this Section during the reporting period;

(b) The total assessed value of all land, and construction thereon, regarding which exemption under this Section has been granted in the reporting period, and the amount of such value which is exempted;

(c) The total assessed value of all land, and construction thereon, regarding which exemption under this Section is in effect at the end of the reporting period and the amount of such value which is exempt at the end of such period;

(d) For each property for which exemption is in effect during the reporting period:

(.1) the address, ward and census tract where the property is located;

(.2) the previous address of the exempt property owner;

(.3) the assessed value of the land and construction thereon for each year that the exemption has been in effect;

(.4) the amount of assessed valuation for which exemption has been granted;

(.5) the sales price for each sale of the property or any exempt dwelling unit thereon, for each sale of the property, during the period in which the exemption has been in effect.

The Board may require of parties exempt under this Section such annual reports as may be necessary for the Board to fulfill its duties under this subsection. The Board shall have the authority to terminate a tax exemption on the failure of an exempt party to submit such report as required.

(9) Reserved.

(10) Severability. If any sentence, clause, section or part of this ordinance is for any reason found to be unconstitutional, illegal or invalid, such unconstitutionality, illegality or invalidity shall not affect or impair any of the remaining provisions, sentences, clauses, sections or parts of this ordinance. It is hereby declared as the intent of the City Council that this ordinance would have been adopted had such unconstitutional, illegal or invalid sentence, clause, section or part thereof been included herein.

(11) Periodic Evaluation Requirement. At least once every three years, beginning with the year 2024, the Council shall, by separate ordinance, select an independent expert to evaluate the specific impact on the real estate market of the modification made by subsection 19-1303.4(5)(b) to the exemption authorized by Section 19-1303.4. The expert shall also comprehensively evaluate the overall impact of the exemptions for commercial and residential construction authorized by Sections 19-1303.2, 19-1303.3 and 19-1303.4, including the extent to which taxpayers who are delinquent in any City taxes are nonetheless receiving exemptions, and shall submit recommendations for any modifications to those exemptions. The expert engaged for this purpose shall be selected pursuant to the procedure set forth in Chapter 17-1400 for the awarding of non-competitively bid contracts. Final copies of the report shall be provided to the Mayor, each member of Council, and to the Clerk of Council, who shall see to it that a copy is posted on the City's official internet site.

Notes

215	Added, 1983 Ordinances, p. 49; amended and new subsections added, 1985 Ordinances, p. 9. Enrolled bill numbered this as Section 19-1303(4); renumbered by Code editor.
216	Amended, Bill No. 000064 (approved October 31, 2000). Section 2 of Bill No. 000064 reads as follows: "Effective Date; Application. This Ordinance shall take effect immediately, and shall apply only to exemptions for which application is made to the Board of Revision of Taxes on or after such effective date."
217	Added, 1987 Ordinances, p. 302; amended, 1987 Ordinances, p. 1227. Enrolled Bill Nos. 1202 and 1368 (1987 Ordinances, pp. 302 and 1227) both read "(5)"; renumbered by Code editor. Amended, Bill No. 200573 (approved January 20, 2021).
218	Amended, 1987 Ordinances, pp. 302 and 1227; amended, Bill No. 000064 (approved October 31, 2000). Section 2 of Bill No. 000064 reads as follows: "Effective Date; Application. This Ordinance shall take effect immediately, and shall apply only to exemptions for which application is made to the Board of Revision of Taxes on or after such effective date."
219	Added, Bill No. 020647 (became law April 10, 2003).
220	Amended, 1990 Ordinances, p. 742 (effective July 1, 1990).
221	Amended, 1987 Ordinances, p. 1491; amended, Bill No. 970214 (approved December 9, 1999); amended, Bill No. 000226 (approved September 12, 2000), effective upon state authorization from Act of October 18, 2000, P.L. 613, No. 83, effective in 60 days; amended, Bill No. 190944-A (approved December 30, 2019). Enrolled bill added a subsection but failed to renumber subsequent subsections; renumbered by Code editor. Amended, Bill No. 200366 (approved December 15, 2020).
222	Amended, Bill No. 010508 (approved November 14, 2001).
223	Amended, 1987 Ordinances, pp. 302 and 1227; amended, Bill No. 000064 (approved October 31, 2000). Section 2 of Bill No. 000064 reads as follows: "Effective Date; Application. This Ordinance shall take effect immediately, and shall apply only to exemptions for which application is made to the Board of Revision of Taxes on or after such effective date."
224	Added, 1987 Ordinances, p. 302; amended, 1987 Ordinances, p. 1227; amended, Bill No. 200573 (approved January 20, 2021).
225	Renumbered, 1987 Ordinances, p. 302.
226	Renumbered, 1987 Ordinances, p. 302.
227	Renumbered, 1987 Ordinances, p. 302.
228	Renumbered, 1987 Ordinances, p. 302.
229	Amended, 1987 Ordinances, pp. 302 and 1227; amended, Bill No. 000064 (approved October 31, 2000). Section 2 of Bill No. 000064 reads as follows: "Effective Date; Application. This Ordinance shall take effect immediately, and shall apply only to exemptions for which application is made to the Board of Revision of Taxes on or after such effective date."
230	Amended, 1990 Ordinances, p. 742; deleted, Bill No. 190944-A (approved December 30, 2019).
231	Added, Bill No. 190944-A (approved December 30, 2019); amended, Bill No. 200573 (approved January 20, 2021).

§ 19-1303.5. Authorization to Offer Exemptions from Real Estate Taxes on Improvements to Convert Deteriorated Industrial, Commercial or Other Business Property to Commercial Residential Use.

(1) Legislative Findings.

(a) The Council finds that Pennsylvania Act 1977-76, as amended, (the "Act") authorizes local taxing authorities to exempt from real estate taxes improvements to certain deteriorated industrial, commercial and other business property.

(b) A public hearing, as required by the Act, regarding the boundaries of the areas containing deteriorated industrial, commercial and other business properties has been held and it has been determined that all wards of the City contain deteriorated industrial, commercial and other business property; therefore it has been determined that the boundaries of the deteriorated areas of the City containing such properties include all wards within the City.

(.1) There exists a high and longstanding vacancy rate in a large number of commercial, industrial and other business buildings, located throughout the City, resulting in deterioration of these buildings and in the areas surrounding these buildings and a reduction in real estate taxes collected by the City. This is a socially and economically undesirable condition and use of these properties.

(.2) It would be beneficial to the improvement of the social conditions in the areas containing these properties and to the improvement of the economic base of the City to encourage, through tax exemption, (i) the improvement of these properties for commercial residential use, (ii) the increase in the number of City residents, and (iii) the enhancement of neighborhood communities able to support a broad range of retail and cultural uses.

(2) Eligible Areas.

(a) The Council determines that all the wards of the City contain "deteriorated areas" and "deteriorated commercial, industrial and other business property" as defined in the Act, and are entitled to real estate tax exemption under this Section 19-1303.5.

(b) Any person making qualified improvements to eligible property, as such terms are defined in this Section, which is located in any of the eligible areas, may apply for, and the Board of Revision of Taxes may grant, a real estate tax exemption upon such improvements in the amount and in the manner hereinafter provided.

(3) Definitions. The following words and phrases when used in this Section shall have the meanings given to them in this subsection unless the context clearly indicates otherwise:

(a) Board. The Board of Revision of Taxes.

(b) Commercial residential use. Space is used for a commercial residential use if it is suitable for and is generally to be used by the occupants for personal residence purposes of six months or more. Commercial residential use does not include residential property occupied by the owner or hotels.

(c) Conversion area. The entire floor area of an eligible property above the ground level and below the roof and any area of the eligible property to be used for parking by residents or guests only and not by the public.

(d) Deteriorated property. Any industrial, commercial or other business property which is an eligible property and is located in an eligible area.

(e) Eligible property. Any industrial, commercial or other business property if:

(.1) such property has not been used for Commercial Residential Use within the last ten years at the time of the first application for a building permit for the qualified improvement;

(.2) sixty-six and two-thirds percent (66-2/3%) or more of the conversion area is vacant prior to the first application for a building permit for qualified improvements; and

(.3) either:

(.a) the vacancy described in subsection (3)(e)(.2) above has existed for at least two (2) consecutive calendar years prior to the first application for a building permit for the qualified improvements; or

(.b) the property was first occupied more than fifty (50) years prior to the first application for a building permit for the qualified improvement.

(f) Other business property. Other business property shall include institutional property such places of worship, hospitals, schools, fire stations, police stations and post offices.

(g) Qualified improvement. Any repair, construction or reconstruction, including alterations and additions, having the effect of converting all or a portion of the conversion area of the deteriorated property from non-residential use to commercial residential use, so that it becomes habitable, provided that at least fifty percent (50%) of the conversion area, measured by floor area, is so converted (the "50% test"). Ordinary upkeep and maintenance shall not be deemed a qualified improvement.

(h) Special Service District. Any authority created pursuant to the Municipality Authorities Act of 1945 (53 P.S. §§ 301 et seq.) for the purpose of making business improvements or providing administrative services within a particular district.

(i) Tax delinquency. All City of Philadelphia, School District of Philadelphia and Special Services District taxes, charges, fees, rents or claims that the owner of the deteriorated property has not paid when due, whether or not liens for such have been filed in the Office of the Prothonotary of Philadelphia County, and shall include all penalties, additions, interest, attorneys' fees and costs due on such delinquent taxes, charges, fees, rents or claims. The Tax Delinquency shall also include all taxes, charges, fees, rents or claims that the owner of the deteriorated property has not paid at the time of the application for the abatement, and that accrue during the application process and during the abatement period.

(4) Exemption.

(a) Exemption amount.

(.1) The Board shall exempt from real estate taxes that portion of the assessment of the eligible property attributable to the actual cost of the qualified improvement. This amount shall be referred to as the assessable amount of qualified improvement.

(.2) The exemption from real estate taxes shall be limited to the qualified improvement for which an owner has applied for an exemption in the manner set forth in subsection (4)(c) below.

(b) Exemption schedule.

(.1) The Board shall exempt from real estate taxes the entire amount of the assessable amount of qualified improvement for a period of ten years, subject to the other requirements of this Section. After year ten, the abatement shall terminate. The exemption shall commence for the tax year immediately following the year in which City issues the final Certificate of Occupancy for commercial residential use of the property.

(.2) The exemption from real estate taxes granted under this Section shall be upon the property or portion thereof and shall not terminate upon the sale or exchange of the property or any portion of the property, except upon the sale of the property or a portion of the property to an owner who does not use the property for commercial residential use.

(.1) At the time the record owner or its agent applies for the first building permit for the construction of the qualified improvement, the Department of Licenses and Inspection shall notify the building permit applicant of the possibility of a real estate tax exemption pursuant to this Section. Within sixty (60) days of the date on which the City issues the first building permit for the qualified improvement, the record owner of the deteriorated property shall apply to the Board for this real estate tax exemption. The application shall be in writing upon forms prescribed by the Board and must be filed within the specified time period.

(.2) The Board shall determine whether the abatement shall be granted. The Board shall forward a copy of the approved request for exemption, or any document showing that the Board has approved the application, to the owner.

(.3) The Board, in determining whether the abatement shall be granted, shall inquire of the Department of Revenue of the City of Philadelphia and Special Service District, if applicable, whether the owner is indebted for or on account of any tax delinquency. The Board shall withhold approval of the application until the owner pays or enters into an agreement with the City of Philadelphia, School District of Philadelphia, or the Special Services District to pay the tax delinquency. The Board shall revoke the abatement where the owner fails to pay as provided herein or becomes indebted for or on account of any tax delinquency.

(.4) In the event the original owner sells the property, or a portion of the property, for which the Board has granted an exemption and not revoked it, to a new owner, the new owner shall file with the Board an application for the continuation of the exemption within sixty (60) days of the date of the transfer of the property or portion of property. The Board shall continue the exemption so long as the new owner is not indebted for or on account of any tax delinquency and the new owner continues to use the property for commercial residential use. The Board shall revoke the exemption if the new owner, during the abatement term, became indebted for or on account of any tax delinquency or fails to use the property for commercial residential use.

(.5) Any revocation of the exemption shall not extend the ten year abatement period for which the owner would otherwise qualify.

(.6) The Board shall separately value the qualified improvement annually. After the City of Philadelphia has issued the final Certificate of Occupancy, the Board shall determine the portions of the improvement qualifying for exemption in accordance with the exemption schedule in subsection (4)(b) above.

(.7) The Board shall notify the record owner of the deteriorated property of the amount of the assessment approved for exemption and the valuation of the assessment. Within thirty (30) days of the notification of the valuation of the assessment and amount of assessment approved for exemption, the record owner may request a hearing before the Board to challenge the determination. The City and the record owner may appeal the final determination of the Board to the Court of Common Pleas as provided by law.

(d) Continuation of tax exemption; termination of tax exemption.

(.1) Once granted by the Board, the tax exemption shall continue in accordance with this Section for any portion of a residential improvement that continues to be used for commercial residential use provided that the owner annually files a certificate of continuing use so stating. The certificate shall be filed with the Board on such forms and contain such information as shall be prescribed by the Board.

(.2) The Board shall have authority to terminate a real estate tax exemption to the extent that the improvement ceases to be used for commercial residential use, on the failure of the owner to file an annual certificate of continuing use, or on the failure of the owner to pay any tax delinquency or comply with his agreement to pay.

(e) Other exemptions. This Section shall not preclude an exemption under any other Section of this Code for a portion of property not exempt under this Section.

(5) Regulations. The Board shall promulgate regulations establishing a procedure for evidencing that a property is an eligible property and for such other matters as may be consistent with this Section.

(6) Severability. If any sentence, clause, subsection or part of this Section is for any reason found to be unconstitutional, illegal or invalid, such unconstitutionality, illegality or invalidity shall not affect or impair any of the remaining provisions, sentences, clauses, sections or parts of this Ordinance. It is hereby declared as the intent of the Council that this Section would have been adopted had such unconstitutional, illegal or invalid sentence, clause, Section or part thereof been included herein.

(7) Effective Date. The provisions of this Section shall apply to applications for exemptions initially applied for on or after the date of enactment.

(8) Termination Date. The provisions of this Section shall terminate as of June 30, 2002. Any application for exemption received after June 30, 2002 shall be ineffective.

Notes

232	Added, Bill No. 970274 (approved July 1, 1997). Enrolled bill numbered this as Section 19-1303(5); renumbered by Code editor.
233	"Local Economic Revitalization Tax Assistance Act", 1977, December 1, P.L. 237, No. 76, 72 P.S. §§ 4722 et seq.

§ 19-1304. Duties of the Board of Revision of Taxes.

(1) Definitions.

(a) Condominium. As defined in the Uniform Condominium Act, Act of July 2, 1980, P.L. 286, No. 82, 68 Pa. C.S. § 3103.

(b) Unit. As defined in the Uniform Condominium Act, Act of July 2, 1980, P.L. 286, No. 82, 68 Pa. C.S. § 3103.

(2) Numbering of Houses.

(a) The Board of Revision of Taxes shall number all buildings, houses, condominiums, or other structures located within the City in accordance with the following numbering system:

(.1) the initial or starting point shall be at Market Street and the Delaware River respectively, allowing 100 numbers to each square of 350 or more feet in length, and commencing with an even 100 at the commencement of each such square;

(.2) on streets running in opposite directions, but not extending to the aforesaid initial points, the same system of numbering shall be employed as though such streets did actually extend to such initial points;

(.3) individual numbers shall be assigned to each unit of a condominium;

(.4) in any part of the City where the Board finds that it is impractical to follow the numbering system herein set forth, it may depart from such system but shall arrange the numbering in such areas as nearly in accordance with said system as may be possible.

(b) The Board shall furnish the owner or occupant of all buildings, houses, structures, or condominium units located within the City a written notice of the correct number of the building, house, structure, or condominium unit owned or occupied by him as assigned according to subsection 19-1304(2)(a) and after service of such notice such building, house, structure, or condominium unit shall be designated and identified by such number in all pertinent City records.

Notes

234	Source: 1856 Ordinances, p. 219; 1880 Ordinances, p. 144.
235	Added, 1987 Ordinances, p. 78.
236	Renumbered, amended and subsection added, 1987 Ordinances, p. 78.

(1) Definitions. As used in this Section:

(a) Income means all regular and periodic income from whatever source derived, including but not limited to salaries, wages, income from self-employment, alimony, support money, cash public assistance and relief, the net amount of any pensions or annuities including railroad retirement benefits, all benefits received under the Federal Social Security Act (except Medicare benefits), all benefits received under State employment insurance laws and veterans' disability payments, all interest received from the Federal or any State government, or any instrumentality or political subdivision thereof, net income from rentals, workmen's compensation, interest and dividends, and any regular and periodic monetary contributions from a non-household member. Income shall not include overtime; back pay; severance pay; bonuses; tuition reimbursements; loan disbursals; federal or state income tax refunds; lump sum payments of benefits such as loss of time insurance benefits, death benefits, life insurance benefits and other insurance proceeds; Supplemental Nutrition Access Program ("SNAP") benefits or any other form of surplus food or other relief in kind supplied by a governmental agency; or property tax rebate.

(b) Total Household Income means all income received by the taxpayer and members of his or her household while residing in the homestead.

(c) Homestead means a dwelling used as a home, occupied by a taxpayer. A homestead shall also include mobile homes which are assessed as realty for local property tax purposes and the land upon which the mobile home is situated and other similar living accommodations, as well as a part of a multi-dwelling or multi-purpose building and a part of the land upon which it is built to the extent that the eligible taxpayer is chargeable by the City for property taxes. It shall also include premises occupied by an eligible taxpayer if he is required "by law" to pay a property tax by reason of his ownership or rental (including a possessory interest) in the dwelling, the land, or both; provided that the term "by law" shall not be deemed to include a contractual obligation between the eligible taxpayer and a person who would otherwise be responsible to the City for the payment of the tax.

(d) Department shall mean the Philadelphia Department of Revenue, its officers, agents and employees. The term shall also include co-counsel or other entities hired or retained by the City of Philadelphia to collect property taxes owed to the City of Philadelphia. The term shall also include the Law Department or any other department or office of the City of Philadelphia, its officers, agents and employees to the extent that it is engaged or involved in the collection of property taxes covered by this Act.

(e) Owner shall mean both (a) an owner of record, as recorded with the Department of Records, and (b) an equitable owner, defined as a person who can demonstrate an ownership interest in a property as provided by law. An equitable owner includes, but is not limited to: a person who has inherited an interest in a property; a person who has entered into a contract to purchase a property; and a person who was the owner of record before a fraudulent conveyance of the property. The term "owner" shall also include a person who is a trust beneficiary and a person holding a partial ownership interest in a property such as tenancy by the entireties, joint tenancy, tenancy in common, and life estate.

(f) Tax liabilities shall mean both property taxes which are delinquent and property taxes which are currently due but not yet delinquent, including but not limited to associated attorneys' fees, eligible expenses, interest and penalties as allowed by law.

(g) Senior citizen means a taxpayer who is sixty-five years of age or over, or whose spouse, if a member of the household, is sixty-five years of age or over, during a calendar year in which real property taxes are due and payable.

(2) Authorization for Installment Payments and Tax Foreclosure Prevention Programs; Waiver of Additions to Tax; Abatement of Interest and Penalties and Requiring Commencement of Enforcement Action.

(a) Universal Applicability. This Chapter, and all regulations and policies adopted pursuant to it, shall apply equally to the Department of Revenue, the Law Department of the City of Philadelphia, the Philadelphia Tax Review Board, any other department, agency, office or employee of the City seeking to enforce or collect property taxes, and all co-counsel or other businesses or parties hired or retained by the City to collect property taxes.

(b) Warning of Risk of Tax Foreclosure Action.

(.1) First Notice. Should a taxpayer not remit payment for current year real estate tax liabilities or enter into a payment agreement by March 31st of such tax year, within sixty (60) days the Department shall send the taxpayer a Warning of Risk of Tax Foreclosure Action containing the following information:

(.a) a brief description of any possible legal action and its consequences, including a clear and conspicuous statement that the taxpayer will become in danger of losing his or her home or property if he or she does not act; as to homestead properties, a statement of the right of the taxpayer to enter into an income-based payment agreement for all real estate tax liabilities on the taxpayer's homestead property, the availability of the free assistance of a housing counselor, and the right to apply for tax payment deferral for financial hardships as provided in this Section 19-1305 and in Section 19-1307; as to non-homestead properties, a statement of the right of the taxpayer to request consideration for a payment agreement for all real estate tax liabilities on the taxpayer's non- homestead property; a brief description of the available payment agreements, the steps the taxpayer must take to enter into such an agreement, and the deadline for doing so; and a brief description of any non-principal additions, charges, fees, penalties, or interest that may be imposed if the real estate tax liabilities remain outstanding;

(.b) the amount of current year real estate tax liability;

(.c) the amount of any prior year real estate tax liability, specifically indicating the amounts of such prior year liability that are principal, interest, penalty, and attorney's fees as well as any other amounts or fees;

(.d) the total amount required to pay off the tax liability in full, the date by which it must be paid, the addresses where payments can be made, and accepted forms of payment;

(.e) a statement explaining the types of other City-related debt that may be capable of being liened against a property including, without limitation, water and sewer rent, nuisance and demolition fees and fines, and a brief explanation of how the taxpayer may request confirmation as to the existence and amounts of any such debt;

(.f) brief, accurate information about available assistance programs including homestead exclusions, tax rebates, tax relief, and tax deferrals for homestead properties; and

(.g) lists of the free housing counseling agencies and the legal services agencies that have been trained in assisting with delinquent real estate tax matters related to homesteads and may be available to assist the taxpayer, including addresses and phone numbers.

(.2) Second Notice. Should a taxpayer not respond to such Notice of Risk of Foreclosure Action within ninety (90) days of the date of the notice, the Department shall send a second notice containing the same information required under subsection (.1) and any updates thereto, and a warning that the City may commence foreclosure proceedings against the taxpayer should he or she not pay the outstanding real estate tax liabilities or enter into a payment agreement or tax payment deferral program by December 31 of such year.

(.1) The City acting by or through the Office of Property Assessment, the Department of Revenue, the Law Department or any other department, shall advertise twice per month each month of the year, in at least three (3) community papers, the availability of income-based payment agreements and tax relief programs including, the Homestead exclusion, pursuant to subsection 19-1301.2(4)(a)(.3); Deferral, pursuant to Section 19-1307; Longtime Owner-Occupant Exemption pursuant to subsection 19-3905(3)(a); and Senior Citizen Low Income Special Tax Provisions pursuant to subsection 19-2904(1)(a). When a taxpayer contacts the Department regarding real estate tax liabilities the Department shall ask if the property is the taxpayer's residence, and shall provide the following information:

(.a) If the taxpayer claims to reside in the property, the Department shall inform the taxpayer of the steps to apply for homestead recognition, the right to an income-based payment agreement for homestead properties and the steps to apply for such payment agreements, and the availability of free advice and assistance from housing counseling agencies and legal services agencies for taxpayers who are eligible. The Department shall also provide written information regarding the payment agreement options for homesteads, as well as a list, including addresses and phone numbers, of housing counseling agencies and legal service agencies available to assist the taxpayer.

(.b) If the taxpayer claims not to reside in the property, the Department shall inform the taxpayer of the right to request consideration for a payment agreement and the steps to apply for consideration for such payment agreements.

(.2) Information Available Online. The Department shall clearly and conspicuously post information regarding the available payment agreements, hardship deferrals, and assistance programs on its website. Such information shall summarize the program and terms of the agreements and the eligibility requirements. It shall include a question-and-answer section as well as application forms, sample agreements, and copies of all notices provided for in this Chapter. The Department's website shall also clearly and conspicuously post contact information, including addresses and phone numbers, for housing counseling agencies and legal service agencies that may be available to advise or assist eligible taxpayers.

(.3) Language Access/Non-English Speakers. Consistent with applicable law and policy, the Department shall take reasonable steps to ensure meaningful access to payment agreements for Limited English Proficient (LEP) persons. Such steps shall include providing copies of all vital documents in English and Spanish, both on-site and on-line translations of all vital documents, including notices and agreements, as well as providing translated "taglines" on all English language notices, and advising LEP persons that telephone interpreter services are available at the Department.

(.4) In-Person Meeting. A taxpayer seeking to enter into a payment agreement related to real estate tax liabilities on his or her primary residence shall, unless such taxpayer elects otherwise, be entitled to an in-person meeting with the Department within 30 days of such request for the purpose of evaluating the taxpayer's payment agreement options, and be offered the assistance of an independent housing counselor. In addition, the Department may also appoint an attorney, or interpreter to assist the taxpayer in such a meeting. The appointed housing counselor shall assist in arriving at a financially reasonable payment plan for the taxpayer.

(d) Homestead Payment Agreements. Payment agreements with taxpayers are authorized for all amounts due on real estate tax liabilities on the homesteads of taxpayers, subject to the following terms and conditions:

(.1) Eligibility. Eligibility for a payment agreement under this Section and for placement in any particular Tier under this Section, shall be understood in all cases to require showing of financial hardship or inability to pay, based on individual circumstances. Taxpayers may be required to demonstrate proof of ownership including equitable ownership, residency, and up to two months of household income in order to be found eligible for a homestead payment agreement, provided however that a taxpayer shall not be required to liquidate any assets, including other real property, in order to qualify for a homestead payment agreement. The Department shall promulgate a list of documents that shall be accepted as proof for the purposes of this Section. The Department may also request a taxpayer's most recent federal tax return if applicable and, for good cause, such additional information as may be necessary to determine eligibility.

(.a) Eligibility for Equitable Owners. Taxpayers who are equitable owners may qualify for payment agreements, provided that the Department may discontinue such agreements after three years if it determines that the taxpayer has not made a good faith effort to obtain record title to the property covered by the agreement. The Department shall notify the taxpayer in writing of this obligation to seek title at the time of the signing of the agreement.

(.b) The Department may deny a taxpayer's eligibility for a payment agreement for good cause, provided that such denial may be appealed pursuant to subsection (5)(a) of this Section. A taxpayer who is otherwise eligible for a payment agreement under this Section shall not be denied a payment agreement based on the taxpayer's default or failure to comply with a payment agreement executed prior to the effective date of this Section.

(.2) Payment agreements shall provide for payment of one hundred percent (100%) of all tax liabilities, including capitalized additions, owing through the date of the agreement or March 31 of the year of the agreement, whichever is later, less any waiver of interest or penalties as provided in subsection (.6), below.

(.a) The Department shall provide an opportunity for taxpayers entering into payment agreements to apply for the following programs: Homestead exclusion, pursuant to subsection 19-1301.2(4)(a)(.3); Deferral, pursuant to Section 19-1307; Longtime Owner-Occupant Exemption pursuant to subsection 19-3905(3)(a); and Senior Citizen Low Income Special Tax Provisions pursuant to subsection 19-2904(1)(a). The housing counselor shall assist the taxpayer in applying for the aforementioned programs. If a taxpayer is approved for any of these programs and such approval results in the reduction of the taxpayer's total tax liabilities, within thirty (30) days of such approval the Department shall adjust the total amount due under the payment agreement as well as the monthly payment amounts, and shall provide to the taxpayer prompt notice of any adjustments. In negotiating settlements with delinquent taxpayers, the Department may consider the taxpayer's eligibility for relief for which he or she failed to apply.

(.3) Monthly Payments Based on Income. Monthly payment amounts due pursuant to homestead payment agreements shall be based upon the taxpayer's monthly household income as a percentage of Area Median Income as determined annually by the United States Department of Housing and Urban Development, as follows, and shall not require initial lump sum payments or down payments unless elected by the taxpayer:

(.a) Tier 1. For taxpayers with monthly household income above seventy percent (70%) of Area Median Income, payment agreements shall be made available at the discretion of the Department, provided that the Department shall take into consideration evidence of financial hardship submitted to it by the taxpayer.

(.b) Tier 2. For taxpayers with monthly household income ranging from greater than fifty percent (50%) up to and including seventy percent (70%) of Area Median Income, payments shall equal ten percent (10%) of such monthly household income;

(.c) Tier 3. For taxpayers with monthly household income ranging from greater than thirty percent (30%) up to and including fifty percent (50%) of Area Median Income, payments shall equal eight percent (8%) of such monthly household income;

(.d) Tier 4. For taxpayers with monthly household income at or below thirty percent (30%) of Area Median Income, payments shall equal five percent (5%) of such monthly household income, provided that twenty-five dollars ($25) is the minimum monthly payment;

(.e) Individualized Consideration of Hardship and Financial Incapacity. Taxpayers may request an individual financial assessment comparing household income and expenses, and shall be considered for the following relief:

(i) Where the taxpayer meets the criteria under subsection (.b) ("Tier 2"), (.c) ("Tier 3"), or (.d) ("Tier 4"), but the minimum monthly payment would, based on the individualized financial assessment, present a hardship to the taxpayer, the Department may allow the taxpayer to elect an alternative payment amount provided that twenty-five dollars ($25) is the minimum monthly payment.

(ii) Where the Department finds that a taxpayer in any Tier, based on the individualized financial assessment, lacks the ability to make a regular monthly payment of any amount, the Department may allow the taxpayer to elect an agreement with no minimum monthly payment.

(.4) Payment Agreements for Current Real Estate Tax Liabilities. Payment agreements for current year real estate tax liabilities are specially authorized for taxpayers who are senior citizens, taxpayers with monthly income up to and including fifty percent (50%) of Area Median Income, and taxpayers who demonstrate hardship, for a term not to extend beyond December 31 of the tax year, except that a longer term may be granted at the discretion of the Department. Notwithstanding any provision of this Title to the contrary, for applications received no later than the 31st day of March of the year in which the tax is due and payable, the Department of Revenue shall waive any additions to a current tax liability due on the homestead of a taxpayer who enters an into a payment agreement pursuant to this subsection, provided that the terms of the agreement are fully complied with by the taxpayer. Notwithstanding any provision of this Title to the contrary, any interest and penalties related to current year tax liabilities which shall accrue or become due and payable by any taxpayer shall be abated upon successful completion of a payment agreement entered into pursuant to this subsection.

(.5) Senior citizens and people with disabilities age 18 and older who are eligible for the Pennsylvania Senior Citizen Real Property Tax Rebate ("the rebate") shall be permitted to voluntarily assign the rebate they are entitled to receive to the Department to be credited against their property tax liabilities. The Department shall promulgate such regulations, rules, written policies, forms and other documentation deemed necessary to enable the assignment of such rebates to the Department.

(.6) Completion of Agreements; Forgiveness.

(.a) A payment agreement shall be considered completed upon payment of all tax liabilities, as provided in subsection (.3), above, less a waiver of interest or penalties, as follows:

(i) For taxpayers in Tier 1, no waiver of interest or penalties accrued as of the date of the agreement.

(ii) For taxpayers in Tier 2, waiver of one hundred percent (100%) of penalties accrued as of the date of the agreement.

(iii) For taxpayers in Tier 3, waiver of one hundred percent (100%) of penalties and fifty percent (50%) of all interest accrued as of the date of the agreement.

(iv) For taxpayers in Tier 4, waiver of one hundred percent (100%) of penalties and one hundred percent (100%) of interest accrued as of the date of the agreement.

(v) For taxpayers who request an individual financial assessment under subsection (2)(d)(.3)(.e), the amount of waiver of interest and penalties shall be determined by the Tier in which their monthly household income falls.

(.b) Notwithstanding any provision of this Title to the contrary, within thirty (30) days of a taxpayer, who is enrolled in an income-based payment agreement, making all payments required thereunder, the Department shall:

(i) immediately waive, forgive, and abate all interest and penalties, as provided for in subsection (.a), above;

(ii) certify that the entire real estate tax liability is paid in full;

(iii) correct any records (written, computerized, or otherwise) the City maintains regarding the taxpayer's account to reflect that the account is current; and

(iv) inform the taxpayer in writing by first-class mail that his or her real estate tax account is current and that the outstanding tax liabilities are paid in full.

(e) Non-Homestead Payment Agreements. Payment agreements with taxpayers are authorized for all amounts due on real estate tax liabilities on properties other than homesteads, in the discretion of the Department.

(f) Terms of Payment Agreements.

(.1) Maintenance of Current Taxes. While enrolled in a payment agreement pursuant to this Section, a taxpayer generally is obligated to pay the current year real estate taxes that come due and owing during each subsequent year. Provided that, nothing in this subsection (2)(f)(.1) shall preclude a taxpayer enrolled in a payment agreement pursuant to this Section from entering into a deferral of taxes under Section 19-1307. And further provided that, so long as a taxpayer is eligible for a Tier 4 agreement or for an agreement based on an Individual Financial Assessment under subsection (2)(d)(.3)(.e), the Department shall add current year taxes to the payment agreement unless the taxpayer directs the Department otherwise; a taxpayer who is otherwise compliant with the agreement shall be deemed to be in full compliance. A taxpayer who is compliant with any agreement approved under subsection 19-1305(2)(d) shall be treated as paying property taxes in a timely manner and the taxpayer shall be deemed not in default on real estate tax subject to such agreement.

(.2) Tolling of Charges. While a taxpayer is making payments toward real estate tax liabilities under a homestead payment agreement, all amounts for additions, interest, penalties, fees, and other charges provided for under Section 19-1303 will be tolled and shall not continue to accrue after the date of the agreement, provided, however, that such amounts will be added to the taxpayer's total liability should he or she fail to successfully complete the payment agreement.

(.3) Application of Payments. Notwithstanding any provision of this Title to the contrary, unless otherwise provided in any applicable bond covenants, payments made pursuant to a payment agreement shall be credited to the taxpayer's delinquent account as follows:

(.a) Until such time as the total principal included in the taxpayer's payment agreement is repaid, one hundred percent (100%) of all payments made under the terms of such agreement shall be credited and accounted toward such total principal amount and any associated attorneys' fees, in the same proportion as the two liabilities bear to each other. No part of any payment made under the agreement may be used to pay or reduce other amounts demanded as due under Section 19-1303, including, but not limited to, charges for additions, interest and penalties, or other fees, until such time as the taxpayer shall have made payments equal to the amount of the total principal due; provided that the Department may, by regulation, provide that payments may be allocated to reimbursable expenses prior to, or after, any allocation to principal and associated fees.

(.b) Notwithstanding subsection (2)(f)(.3)(.a), where a taxpayer (i) is not required to pay current taxes in addition to their monthly payments under an agreement pursuant to subsection (2)(f)(.1), and (ii) is either a senior citizen or person with a disability age 18 and older, and eligible for the Pennsylvania Senior Citizen Real Property Tax Rebate ("the Rebate"), one hundred percent (100%) of all payments made under the terms of such agreement, up to the amount due thereunder for the current year, shall be applied to current taxes, so as to be eligible for the Rebate.

(.4) Payment Agreements in Writing. All payment agreements shall be in writing and a copy provided to the taxpayer. All agreements shall include but are not limited to the following terms:

(.a) the monthly payment amount;

(.b) the payment due date;

(.c) the specific address to which payment should be mailed as well as a location where payments may be made in person;

(.d) the length or period of the agreement including the number of payments;

(.e) the total amount agreed as due under the agreement;

(.f) a statement of the delinquent tax years covered by the agreement as well as an itemization of the amounts due for each year specifying amounts due for principal, interest, penalties, attorney's fees and other costs or charges;

(.g) the requirement of maintenance of current property tax payments during the length of the agreement as well as an explanation of how current payments should be tendered to the Department in order to avoid misapplication of payments to delinquent tax years.

(.h) a brief explanation regarding how payments will be applied to the delinquency;

(.i) a brief explanation of the consequences of breach and default on agreement including possible legal action;

(.j) a brief explanation of the taxpayer's right to cure payments missed under the agreement as well as the specific address to which cure payments should be sent;

(.k) a brief explanation of conditional forgiveness, if applicable, and the effect of completion of the agreement; and

(.l) a brief explanation of any additional terms or requirements, including recertification of eligibility if applicable.

(.5) Prohibition against Stipulated or Consent Judgments Relating to Homesteads. No payment agreement under this Section for tax liabilities due on a homestead shall contain a term requiring the taxpayer to stipulate or consent to judgment being entered against him or her in any legal action filed to collect delinquent property taxes or any other liens pertaining to his or her homestead.

(.6) No Waiver of Defenses. No payment agreement under this Section for tax liabilities due on a homestead shall contain a term requiring the taxpayer to waive or release all defenses or claims which the taxpayer may have in any legal action filed to collect delinquent property taxes or any other liens pertaining to his or her homestead, provided that the Department may require the taxpayer to stipulate to the total amount of tax liabilities owed.

(.7) The Department shall promulgate standards governing stay, postponement, and holds of pending enforcement actions to allow taxpayers time to apply for and enter into payment agreements, and to seek legal representation or assistance from housing counselors. The Department shall also promulgate standards regarding circumstances under which pending enforcement actions shall be discontinued after a taxpayer enters into a payment agreement.

(.8) Modification of Agreements. Upon written request of the Department no more frequently than once per year, a taxpayer must re-certify to the Department his or her income and eligibility, and the payment agreement shall be modified accordingly. A taxpayer may request a modification of his or her payment agreement due to a change in income or other exigent circumstances, and such a request timely received shall not constitute a breach of that agreement.

(3) Rules and Regulations.

(a) The Revenue Commissioner shall promulgate such rules, regulations, written policy, forms, and other documentation as are deemed necessary to effectuate the purpose of this Section, including a schedule of documentation that shall be accepted as proof of equitable ownership.

(b) The Revenue Commissioner shall promulgate such rules, regulations, written policy, forms, and other documentation as are deemed necessary to effectuate the purpose of the provisions added or amended by the bill adding this subsection (b) within 90 days of the date on which such bill becomes law.

(4) Prohibited Conduct.

(a) False Statements. No person shall intentionally make any false statement when applying to enter into an installment payment agreement. If it is determined that a taxpayer entered into an installment payment agreement on the basis of an intentionally false statement, the agreement shall be null and void.

(b) Material Breach. A taxpayer may be declared in material breach of a payment agreement if the taxpayer fails to make a required payment, provided material breach may not be declared earlier than the sixty-fifth (65th) day from the agreed-upon payment due date and the forty-fifth (45th) day from the mailing of a notice of risk of material breach, and subject to the following terms and conditions:

(.1) Notice of Risk of Material Breach. If a taxpayer fails to make a required payment within twenty (20) days of an agreed-upon payment due date, the Department shall send a notice including a clear statement that the taxpayer is at risk of material breach, the entire amount required to cure the missed payment(s) as well as any payments currently due, the location where this amount may be tendered and the form(s) of payment accepted, and the process to seek a modification of the agreement based on a change in income or other exigent circumstances and any applicable deadlines to seek such a modification. The risk of material breach notice shall also state the date on which the agreement will be considered in material breach, and a brief description of the consequences of material breach of a payment agreement. If a taxpayer has two prior material breaches of a payment agreement, the notice shall additionally include a clear statement that a third material breach will put the taxpayer at risk of default and a brief description of the consequences of default.

(.2) Notice of Material Breach. If a taxpayer is declared in material breach of a payment agreement, the Department shall send a notice including a clear statement that the taxpayer has been declared in material breach, the date on which the material breach was declared, the entire amount required to cure the missed payment(s) as well as any payments currently due and lump sum payments that may be required, the location where this amount may be tendered and the form(s) of payment accepted, and the process to seek a modification of the agreement based on a change in income or other exigent circumstances and any applicable deadlines to seek such a modification. The material breach notice shall also include a brief description of the consequences of material breach of a payment agreement. If a taxpayer has two prior breaches of a payment agreement, the notice shall additionally include a clear statement that a third breach will put the taxpayer at risk of default and a brief description of the consequences of default.

(.3) Reinstatement Following Material Breach. To reinstate a payment agreement that has been materially breached, a taxpayer may be required to make a lump sum payment equal to as much as twice the regular monthly payment due.

(c) Default. Following the effective date of this Section, a taxpayer may be declared in default by written notice sent to the taxpayer after either having failed to cure a material breach within forty-five (45) days of the date the taxpayer is declared in material breach or after having materially breached a payment agreement a third (3rd) time following two (2) cured material breaches within a thirty-six (36) month period. If a taxpayer is declared in default of a payment agreement such agreement shall be null and void. A taxpayer who has defaulted pursuant to this Section will not be entitled to additional agreements under this Section, provided that the Department may at its discretion approve additional agreements on terms which it deems suitable. The Department's refusal to approve additional agreements following default shall not be subject to administrative review or appeal.

(d) Effect of Cure. If payment or action sufficient to cure is received by the Department before a taxpayer is declared in material breach and/or default, the Department shall not declare the taxpayer in material breach and/or default and the payment agreement shall remain in effect, except that a payment received after a third declaration of material breach shall not preclude or cure a declaration of default.

(e) Commencement of Enforcement Action. In the case of taxpayers who do not enter into a payment agreement or otherwise satisfy outstanding liabilities by December 31 of the first year in which the tax is registered as delinquent, and in the case of taxpayers who default on payment agreements, the Department shall timely take all steps as provided for in the Act of 1923, May 16, P.L. 207, No. 153, § 39.4, as amended, 53 P.S. §§ 7147 and 7193.4, or elsewhere. Pursuant to 53 Pa. C.S. § 7147, the Department shall be authorized to assign or transfer to third-parties, real estate tax claims filed or to be filed, for an amount to be determined by the Department. When proceeding under 53 Pa. C.S. § 7147 (related to assignments and transfers) the Department shall:

(.1) Not transfer or assign claims valued at less than one thousand dollars ($1,000);

(.2) Before assigning or transferring real estate tax claims to other third-parties, grant a right-of-first- refusal to any existing third-party assignee of a real estate tax claim related to the property;

(.3) Require that any attorney or other professional services fees be capped at a rate not to exceed two hundred dollars ($200) per hour; and

(.4) Require that any expenses including, attorneys' fees, professional services fees and any other fees or charges related to the assignment, transfer, or sale of a given real estate tax claim not exceed two thousand five hundred dollars ($2,500); and

(.5) Require that interest rates charged by lien holders be capped at ten percent (10%), pursuant to 53 Pa. C.S. § 143; and that penalty rates be capped at five percent (5%), pursuant to 53 Pa. C.S. § 7203; and

(.6) In the case of Homestead Properties, pursuant to Section 19-1301, require that sheriff sale of the property cannot be initiated by a lien holder until two years have passed from the date of purchase of the lien.

(.7) Except for subsections (4)(e)(.2) and (.5) above, the restrictions in subsection (4)(e) shall not apply to the assignment or transfer of tax liens on commercial property.

From time to time the Department may by regulation adjust the fees and charges a lien holder may collect and any caps on such fees and charges.

(5) Review by Tax Review Board.

(a) The Tax Review Board is authorized to review any adverse final decision or determination of the Department relating to initial or continued eligibility for a payment agreement or to the taxpayer's performance of his or her obligations under a payment agreement with the same effect as a petition for review pursuant to Chapter 19-1700 of this Title.

(6) Access to payment history.

(a) Upon request, any taxpayer shall be provided a payment history or account history regarding his or her real estate tax payments.

(b) The Department shall make available in its offices and on its website a form for making such a payment history request; must accept such requests by mail, hand-delivery, or email; and must clearly indicate on the request form how to submit a request through each such means.

(c) Within thirty (30) days of receiving a payment history request from a taxpayer, the Department must send the taxpayer a payment history for the subject property setting forth:

(.1) the amount of current year real estate tax;

(.2) the amount of any prior year real estate tax liability, specifically indicating what amount of such prior year liability is principal, penalty, interest, and other eligible expenses including attorney's fees and costs; and

(.3) the taxpayer's real estate tax payment history, including how each such payment by the taxpayer was applied (i.e., to principal, penalty, or interest).

(d) Such payment history shall be sent to the taxpayer through the means selected by the taxpayer on the request form, which must include the option of first class mail or email.

(7) Reporting.

(a) By January 31 of each year, the Department shall submit a written report to the Mayor, with a copy to the President and Chief Clerk of Council, regarding activities undertaken pursuant to this Section during the previous calendar year.

(b) Each such report shall include the following information for the twelve-month period covered:

(.1) the total number of delinquent accounts broken down by homestead and non-homestead and an aged accounts receivable for such accounts in the aggregate, breaking out amounts due for principal, penalty, and interest;

(.2) the number of notices sent pursuant to subsection (2)(b) and how many taxpayers contacted the Department in response to such notices, broken down by homestead and non-homestead;

(.3) how many taxpayer contacts resulted in new payment agreements being made and a breakdown of such payment agreements by type, term, and amount of liability covered;

(.4) how many taxpayer contacts did not result in payment agreements being made and a breakdown of the reasons for the same (e.g., lack of title, failure of taxpayer to follow up, and so on);

(.5) the total number of taxpayers referred by the Department to housing counseling agencies or legal services agencies including a breakdown of the number of referrals to each agency;

(.6) the total number of existing payment agreements and a breakdown of such payment agreements by type, term, and amount of liability covered, which liability shall be further broken down into principal, interest, penalties, and other fees or costs; and

(.7) the total number of payment agreements on which taxpayers defaulted during the applicable period and the reason(s) for the default.

Notes

237	Added, 1982 Ordinances, p. 743; amended, 1982 Ordinances, p. 807; amended, Bill No. 120054-A (approved June 17, 2013), effective October 15, 2013; caption amended, Bill No. 170519-A (approved October 18, 2017).
238	Bill No. 120054-A misnumbered subsections (1)(d) through (1)(g); renumbered by Code editor.
239	Heading amended, Bill No. 170519-A (approved October 18, 2017).
230	Amended, Bill No. 170519-A (approved October 18, 2017).
241	Amended, Bill No. 170519-A (approved October 18, 2017).
242	Amended, Bill No. 170519-A (approved October 18, 2017).
243	Caption amended, Bill No. 230418 (became law September 14, 2023).
244	Amended, Bill No. 230418 (became law September 14, 2023).
245	Amended, Bill No. 170519-A (approved October 18, 2017).
246	Amended, Bill No. 170519-A (approved October 18, 2017).
247	Enrolled bill incorrectly cited subsection (.5); corrected by Code editor.
248	Enrolled bill read "Chapter 19-3900(3)(a)".
249	Enrolled bill read "Chapter 19-2904(1)(a)".
250	Added, Bill No. 140278 (approved August 5, 2014), effective October 1, 2014; amended, Bill No. 170519-A (approved October 18, 2017).
251	Amended, Bill No. 170519-A (approved October 18, 2017).
252	Amended, Bill No. 140278 (approved August 5, 2014), effective October 1, 2014.
253	Amended, Bill No. 170519-A (approved October 18, 2017); amended, Bill No. 180138 (approved April 18, 2018).
254	Added, Bill No. 170519-A (approved October 18, 2017).
255	Added, Bill No. 170519-A (approved October 18, 2017).
256	Amended, Bill No. 130531-A (approved November 13, 2013), effective November 15, 2013; amended, Bill No. 150265 (approved June 18, 2015).
257	Added, Bill No. 150265 (approved June 18, 2015).

§ 19-1306. Cap on Tax Increases.

(1) Notwithstanding the tax rate set forth in Section 19-1301 or any other law to the contrary, the tax levied on any real property shall not be greater than one hundred four percent (104%) of the prior year's tax levy; provided that the property is owned by the same person who owned the property at the time of the prior year's tax levy.

Notes

258	Added, Bill No. 020577 (approved December 5, 2002). Section 2 of the Ordinance provides: "This Ordinance shall be effective upon enactment of authorizing legislation by the General Assembly." No such authorization has been passed as of January 18, 2019.

§ 19-1307. Deferrals of Real Estate Tax for Taxpayers Based Upon Household Income, Household Expenses, and Available Liquid Assets.

(1) The Department of Revenue is authorized to grant deferrals, in whole or in part, of increases in real estate tax on any real property, that may be due the City of Philadelphia or the School District of Philadelphia, upon making a determination of the eligibility for deferral of an Owner, as provided herein.

(2) For purposes of this Section:

(a) Owner shall mean:

(.1) The owner of record, as recorded with the Department of Records; or

(.2) An equitable owner, defined as a person who has inherited an interest in the property from the deceased owner of record; a person who has entered into an installment land contract to purchase the property from the owner of record; a person who was the owner of record before a fraudulent conveyance of the property occurred; or a person who can demonstrate some other ownership interest in the property; or

(.3) Where the owner of record either is deceased or cannot be located, a person who has registered his or her name with the Department as the person to whom tax bills should be sent and who has been paying such bills for at least the preceding five years.

(.4) Where the Owner acquired the property from a spouse, due to death or divorce, or from a life partner, due to death or termination of the life partnership, the Owner shall be deemed to have been the Owner throughout the period of ownership of the transferring spouse or life partner.

(b) Real Estate Tax shall mean the sum of any real estate tax imposed under Chapter 19-1300 and any real estate tax imposed by the School District of Philadelphia.

(c) Household Income shall mean all income received by the taxpayer and members of his or her household while residing in the homestead.

(d) Principal Residence shall mean the dwelling place of a person, including the principal house and lot, and such lots as are used in connection therewith which contribute to its enjoyment, comfort and convenience. For purposes of this Chapter, the term may also include a building with a maximum of one commercial establishment and a maximum of three residential units of which one residential unit must be the principal residence of the longtime owner-occupant.

(3) Hardship deferral. A deferral of payment of an increase in real estate tax may be granted for any increase, or portion thereof, of real estate tax that is greater than fifteen percent (15%) in any given year, when such increase would create a financial hardship. Hardship shall be determined by consideration of the following factors:

(a) Household Income;

(.1) Real estate tax greater than the following percentages of annual household income shall be considered to support a finding of hardship:

(.a) Tier 1. For taxpayers with annual household income above seventy percent (70%) of Area Median Income for the Philadelphia metropolitan area, as determined by the United States Department of Housing and Urban Development, real estate tax greater than twenty-five percent (25%) of annual household income.

(.b) Tier 2. For taxpayers with annual household income ranging from greater than fifty percent (50%) up to and including seventy percent (70%) of Area Median Income, real estate tax greater than twelve percent (12%) of such annual household income;

(.c) Tier 3. For taxpayers with annual household income ranging from greater than thirty percent (30%) up to and including fifty percent (50%) of Area Median Income, real estate tax greater than eight percent (8%) of such annual household income;

(.d) Tier 4. For taxpayers with annual household income at or below thirty percent (30%) of Area Median Income, real estate tax greater than five percent (5%) of such annual household income;

(.2) Taxpayers with real estate tax that is equal to or less than their percentage of annual household income as outlined in subsection (.1) may be found eligible for hardship deferral based on consideration of the totality of factors.

(b) Reasonable Household Expenses including, but not limited to, housing, food, utilities, transportation, education, health care, debt service payments, and overall tax burden; and

(d) An increase in real estate taxes to two and a half (2.5) times the amount of real estate tax on the property in the immediately preceding tax year shall be considered to support a finding of hardship without regard to the factors set forth in subsections (3)(a) through (3)(c).

(4) For purposes of determining whether a property has experienced an increase of greater than fifteen percent (15%) for purposes of subsection (3), above ("Hardship deferral"), any abatements for the prior tax year, pursuant to Sections 19-1303.2, 19-1303.3, 19-1303.4 or 19-1303.5 or otherwise, shall be disregarded.

(5) No later than forty-five days after the enactment of this Section, the Department shall promulgate such regulations, schedules or procedures as it deems necessary to implement the provisions of this Section, including but not limited to, guidelines for determining eligibility for the hardship deferral authorized by this Section. The Department shall submit any such proposed regulations to the Mayor, the President of City Council, and the Chief Clerk of City Council no later than the date the Department submits the proposed regulations to the Department of Records under subsection 8-407(a) of the Home Rule Charter.

(6) Except as otherwise provided in this subsection, an Owner requesting deferral pursuant to this Section shall apply in form satisfactory to the Department no later than January 31 of the tax year, certifying that the Owner:

(a) Uses the property as the Owner's principal residence; and

(b) Would suffer substantial hardship in the absence of the requested deferral. The Department may require the Owner to submit such materials as the Department deems necessary to evaluate the Owner's assertion of hardship.

(c) The Department is authorized to grant exceptions to the deadline provided at the beginning of this subsection (6) upon provision by an owner of real property of evidence of hardship or evidence of other good cause, at its discretion, provided that no exception to the deadline shall be granted with respect to any application received at the time of or after the certification by the Department that total deferrals equal the maximum permitted under subsection (13). The Department shall promulgate such regulations and forms as are deemed necessary to effectuate the purpose of this subsection. The Tax Review Board is authorized to review any adverse final determination by the Department relating to an individual's application for an exception, in like manner and with the same effect as a petition for review, as provided in Chapter 19-1700.

(7) The Department shall determine the deferral amount for which the Owner is eligible, if any, and shall advise the Owner of its decision no later than thirty (30) days after receiving a completed application. The Owner may elect to defer an amount less than the eligible amount. Subject to continuing eligibility and the conditions set forth in subsection (9), such deferral amount shall also be deferred from Real Estate Tax owing on the property in future years, so long as the Real Estate Tax on the property is at least equal to one hundred fifteen percent (115%) of the Real Estate Tax in the year immediately preceding commencement of deferral.

(8) The Tax Review Board is authorized to review any adverse final determination by the Department relating to an individual's initial or continued eligibility for a deferral pursuant to this Section, in like manner and with the same effect as a petition for review, as provided in Chapter 19-1700.

(9) Deferrals under this Section shall be subject to the following conditions:

(a) The deferred payments shall carry simple interest at an annual interest rate no greater than two (2) percentage points above the interest rate in effect on one year United States Treasury bills on the first day of each year for which interest is assessed.

(b) Deferred payments shall be exempt from additions and interest under Section 19-1303.

(d) The deferral shall terminate upon transfer of the property.

(e) All real estate taxes on the property are current or subject to a payment agreement that is not in default, except in the following circumstances:

(.1) A taxpayer shall not be found ineligible pursuant to subsection (e) while the taxpayer has an application for a payment agreement pending determination by the Department.

(f) An Owner may satisfy the debt, consisting of the deferred amount and the accumulated interest, at any time prior to the sale of the property.

(10) Any deferred payment shall remain deferred, subject to the conditions set forth in subsection (9).

(11) At its discretion, no more than once every twelve (12) months, the Department may request that a taxpayer recertify eligibility for deferral, including by providing necessary documentation. In the event a taxpayer is determined no longer to be eligible for deferral, no further deferrals shall be granted, but any previously granted deferrals shall remain in effect, subject to the conditions set forth in subsection (9).

(12) The Department shall include a notice clearly describing the deferral program authorized by this Section, the steps a taxpayer must take to enter into the program, and the deadline for doing so, with the annual property tax bill sent to each taxpayer. The Department and the Office of Property Assessment shall post a downloadable version of the form on their respective websites.

(13) If, for any tax year, the total City and School District taxes deferred pursuant to the foregoing on all properties in the City, as certified by the Department no later than forty-five (45) days after the deadline for applications under this Section, are in excess of three million dollars ($3,000,000) then, notwithstanding the initial determination of the deferral amount for which a taxpayer is eligible under subsections (3) and (6), deferrals shall be allocated among all eligible taxpayers on a pro rata basis so that the total taxes deferred do not exceed three million dollars ($3,000,000) or such other amount greater than three million dollars ($3,000,000) as the Mayor may authorize.

Notes

259	Added, Bill No. 020579 (approved December 5, 2002). Enrolled bill numbered this as Section 19-1306; renumbered by Code editor. Amended, Bill No. 130417-A (approved June 25, 2013).
260	Amended, Bill No. 140278 (approved August 5, 2014), effective October 1, 2014.
261	Added, Bill No. 140278 (approved August 5, 2014), effective October 1, 2014.

§ 19-1308. Assessment Ratio.

(1) For assessments returned by the Office of Property Assessment in the year 2012 other than as required pursuant to subsections 19-1301(1)(b) and 19-1801(2)(b), the Established Predetermined Ratio to be used by the Office of Property Assessment in determining the assessed value of real property shall be one-tenth of one percent (0.1%). For assessments returned by the Office of Property Assessment in the year 2013 and thereafter, the Established Predetermined Ratio, to be used by the Office of Property Assessment in determining the assessed value of real property, shall be one hundred percent (100%).

Notes

262	Added, Bill No. 040022 (became law June 10, 2004); Caption and Section amended, Bill No. 120175-AA (approved June 30, 2012).

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