2011 Primaries - Allegheny County Executive Edition

Just like death and taxes, elections are an inevitable life event. In Pittsburgh, primaries will be held on May 17. As a registered Democrat, I will attempt to share my opinions and some facts about the Democratic candidates for office.

This is a special year for the county. Why? After his drubbing in the state governor's race, Dan Onorato, our beloved County Executive, has decided against running for the esteemed office.

As an especially informed voter this year, I had the pleasure of listening to the canned speeches of 2 of Dan's potential successors. Unfortunately, they both seem about the same to me - going on and on about their grand plan to subvert the court's fair decision to re-assess property in Allegheny County and praising themselves and the county for avoiding property tax increases over the past 10 years while back-handedly calling our unfair tax paying residents suckers under their breath.

Both of the candidates seem to be riding the coattails of Dan Onorato's successful avoidance of property tax reassessments, their untarnished names, and pretty much nothing else, but they both showed up to my neighborhood association to campaign and give their spiel, so I have to give them credit where credit is due.

Mark Patrick Flaherty - Allegheny County Controller. Lives in Mt Lebanon with his wife and 1 daughter. Wants to study Marcellus Shale drilling further and then profit from it. Will go along with the court's wishes (against his wishes) to reassess property and attempt to insure it is done in a transparent easy-to-appeal manner. Wants light rail to the airport and all suburbs, doesn't think that the drink tax was the right solution for funding Port Authority, but says: "we have to go back to the drawing board and find a solution, because the town cannot function without public transit."

Rich Fitzgerald - Allegheny County Council President. Lives in Squirrel Hill with his wife and 8 children. Wants responsible taxed Marcellus Shale Drilling. He "opposes any effort to implement the court ordered tax reassessments." No mention of Port Authority on his election issues page.

Of these 2 candidates, I'm leaning toward Mr Flaherty. His highlighting of Port Authority on his campaign website and his willingness to follow the court's orders endear him to me.

On the Republican side, Raja, the Mt Lebanon commissioner, appears to be the favorite, which should shape up for a competitive election come the fall. Raja's running against the scoundrel we all love to hate, County Councilor Chuck McCullough.

Onorato's Last Stand On Property Tax

Dan Onorato is in his final year of office as Allegheny County Executive. He has stated that 1 of his top 3 goals in this final year is to stop court-ordered property tax reassessment. Gas drilling on airport land and increasing flight traffic round out the list. Securing funding for Port Authority didn't make the cut.

Allegheny County Council President is also begging the state to hold off on property tax reassessment.

Mr. Fitzgerald, D-Squirrel Hill, proposed a resolution that urges the Legislature to adopt a statewide moratorium on court-ordered reassessments and calls on new Gov. Tom Corbett, a Shaler homeowner, to support it.

So what are their arguments against reassessing?

1. Other counties don't have to reassess regularly, so why should Allegheny County? The State Supreme Court has come down in favor of regular reassessments as being the only fair method to calculate property tax. It's only a matter of time until fairness becomes the standard across the state. Why fight a losing battle? Why aren't our Legislators standing up and insisting that instead of a moratorium, the state forces regular reassessments for ALL counties? Then we wouldn't have to worry about unscrupulous folks fleeing the county for lower taxes, and we would be complying with the law.

2. Property re-assessments simply generate a windfall for local governments as property values overall tend to increase over time. Another bullshit argument. County Council member/scofflaw Chuck McCullough has introduced legislation to "soften the blow" of Property Tax reassessments by generating a "bill of rights" for property owners which would prevent egregious assessment appeals and phase in any tax increases. I say take it a step further and force municipalities to lower their millage rates to keep the total revenue stream consistent over time. It's very simple math.

3. And the most ridiculous?

As Mr. Onorato did last week, Mr. Fitzgerald said he doubted that a reassessment would bring tax relief to homeowners in struggling communities. If property values go down in a neighborhood, he said, a school district may have to raise millage to compensate.

Perhaps it's true that some struggling communities like Wilkinsburg and McKeesport wouldn't significantly benefit from a reassessment. But they also wouldn't be harmed! And more often you have struggling neighborhoods or corridors within a municipality, especially the city of Pittsburgh where the poorer neighborhoods of Homewood and Allentown (amongst many others) would clearly benefit over those more affluent neighborhoods such as the South Side and Squirrel Hill.

Why all this anger about property reassessments?

Because people who live in expensive houses in this county are being systematically under-taxed. Find me one house in Allegheny County that costs more than $200,000 and is being assessed for anywhere near its value, and I will be shocked. Yet every single house on the City of Pittsburgh chopping block is being sold at significantly less than its assessed value (often about 10% of its assessed value). All of these houses are in "struggling" neighborhoods. As a matter of disclosure, I am in the former group; though my house cost significantly less than $200,000, it has a street value of significantly more than my assessed value.

So why do I care?

Because the success of the city relies on the success of all its neighborhoods. As long as the status quo remains, then our poorer neighborhoods will continue their everlasting decline and the schism between the haves and the have-nots will only increase in the city creating more and more friction and violence. Let's put a halt to widening the schism based on unfair practices. Let's vote for people who stand up for equal rights even when their pocketbooks are on the line.

Ridgemont Rejects New Residents

I'm going to preface this post by saying I know nothing about this City Vista development other than today's news snippet in the Post-Gazette.

"The project initially involved nearly 500 residential units and 26 acres -- 10 of those in the City of Pittsburgh. After complaints from the city's Ridgemont residents, the plans were revamped to include only Green Tree at this time. Developers may revisit plans to expand City Vista into Pittsburgh"

But let me get this straight. A developer wanted to build a cross-city-border development in 10 acres of the city and one neighborhood turned it down. How about we raise taxes on Ridgemont residents since they clearly don't want an influx of property taxes and new resident wage taxes into the city coffers. Maybe they're not being taxed enough?

Let's look at the census assessment of Ridgemont:

Its population as of the 2000 census was 530 people. Down from 590 in 1990 and 884 in 1940. Of its 223 housing units, only 2 units were vacant which is an impressive statistic. Of those units a mere 26 (or 11%) are renters. Sounds to me like Ridgemont is fine with the status quo. They don't want any renters invading their peaceful neighborhood.

I understand that not every development is worthwhile, but when your neighborhood is losing population and your city is struggling, it is the time to welcome new housing stock. Let's hope when the developer comes back and wants to expand again, Ridgemont has the common sense to work with the developer.

Weird Pittsburgh News

3 Weird Pittsburgh News Bits that caught my eye this Friday

1) A church bought by a controversial billboard company may become a national immigration museum. Perhaps Lamar wants to clean up their bad name around these parts? Perhaps they'll move the unfinished electronic billboard to the vicinity of the church and finally clean up the mess that is the lighting of the Grant Street Transportation Center?

2) Both Russell Crowe and Jake Gyllenhall are self-proclaimed fans of Pittsburgh. Jake Gyllenhall went so far as to show off his (presumably fake) Pittsburgh Steelers tattoo. After the Sienna Miller fiasco, it's a shock to hear celebrities speak well of the city. I guess they left their hotel rooms.

3) The county and Judge Wettick appear to have agreed on a timeline to *gasp* reassess property values. This is my favorite unexpected news of the day. County Executive Onorato has been on a high horse about refusing to perform anything even tangentially related to a property reassessment, even if it's requisite to taxing county residents fairly (and is required to follow the state constitution). This about face makes me breathe a sigh of relief. But the following caveat makes me wary: "[P]roperty owners would have to pay taxes before appealing [property assessments]."

2 State Bills You Should Be Paying Attention To

The Pennsylvania State House may not be able to pass a budget, but they can sure screw over the residents of Allegheny County. Yesterday, 2 very important bills passed some of their final tests.

1.) The Property Re-Assessment Bill. The State Supreme Court ordered a re-assessment of Allegheny County. Dan Onorato with the support of lots of other sniveling counties in the state, have pushed the state house and senate to put this court-ordered re-assessment on hold for 18 months. The Senate could have their final vote on this one as early as tomorrow. Then it's in the hands of Rendell.

Sen. Jim Ferlo, D-Highland Park, said he had serious doubts about the bill, which has already passed the House, but voted for it yesterday "to keep the process moving.'' He said it may be unconstitutional for the Legislature to tell counties to ignore court orders on reassessment.

Yes, we are moving forward by not moving anywhere for the next 18 months. Is that enough time for Mr Onorato to get elected governor and think of a smarmy way out of this sticky mess?

2.) The Pension Bill - which also determines Pittsburgh's parking taxes. Here the state wants to take over the city's pension funding as well as any other city or municipality facing less than 50% funded. Pittsburgh's pensions are funded at an abysmal 28%. In theory, it sounds like a great idea to out-source this responsibility because clearly Pittsburgh has been failing at it in an unprecedented manner. But at the same time, is the State really any more responsible with their money? And why the micro-managing? Why does this bill include over-arching wording about the parking tax? It should be either a pension bill or a parking tax bill. Luckily, after the Senate votes on this one, it will be lobbed back to the House.

The Squeaky Wheel Gets Lower Taxes

What is it with this state and unfair taxes? Pennsylvania, at the state and county level, continuously finds way to tax its poor unjustly in spite of State Supreme Court rulings to the contrary.

1) The state income tax is not progressive. Everybody (unless you make less than a measly $6,500) gets charged the same 3.07% or if Governor Rendell has his way 3.57%. How about we increase the income tax to 3.57% only if you are making more than $100,000 per year? $200,000? Can't we take a page out of Obama's playbook? Of course, no legislature wants to bite the hand that feeds them donations.

2) To avoid raising property taxes (where you theoretically pay more if you have a more expensive house), the state is attempting to allow counties to raise their sales tax, which is a patently regressive tax, affecting the poor more than the wealthy.

3) Where they have to rely on property taxes, they do so in a patently unjust manner, freezing property values and punishing those who live in depressed neighborhoods.

And why do we put up with it? Because the people who have the time to complain are not the people working minimum wage jobs trying to put food on the table. Some people might say charging progressive taxes is against the state Constitution which says: "All taxes shall be uniform upon the same class of subjects ...," But I say, what's one more bent rule?

Unconstitutional Dan

I have to follow in the footsteps of the PGH Comet and Nullspace in gloating today.

Property tax re-assessments are a boring subject, yet they speak to the division of class in Pittsburgh and Allegheny County. Regular re-assessments are critical in a county like Pittsburgh's where especially in the last 10 years you have had some areas skyrocket in value (i.e. South Side) while others have been sinking like an anchor (i.e. Braddock).

Some people think that you shouldn't be "penalized" for the increased the value of your home by being forced to pay more taxes on it. However, I think that's akin to saying that if you get a raise at work for good performance, you shouldn't owe more in income taxes. On the flip side, that's like saying if your salary decreases, you are still required to pay the same taxes. That's just not the way our society works, and it's brutally unfair.

For far too long, we've had people (including myself) benefiting at the expense of the poorer neighborhoods in this city, county and throughout the state. Thanks to the State Supreme Court, at least in Allegheny County, this unconstitutional practice may be coming to an end.

From Chief Justice Castille:

"[T]he Allegheny County scheme, which permits a single base-year assessment to be used indefinitely, has resulted in significant disparities in the ratio of assessed value to current actual value in Allegheny County."

"The disparity is most often to the disadvantage of owners of properties in lower-value neighborhoods where property values often appreciate at a lower rate than in higher-value neighborhoods, if they appreciate at all," the court said.

But what does Dan Onorato have to say? According to the Post-Gazette:

"... Mr. Onorato vowed to end property reassessments in Allegheny County as well since taking office six years ago. He repeated his vow yesterday."

Why?

"It would be unfair for me to just roll over and do something that will raise the property taxes of the 1.3 million people in this county," Mr. Onorato said.

My response (again)?

"Let's get something straight. Housing prices (in a normal society) increase. It's perfectly natural and expected that prices will increase. In fact, if housing prices didn't increase we'd be in trouble. HOWEVER, the increased value of an assessed house SHOULD NOT mean increased property tax. When values go up, the county or the city or whomever, SHOULD adjust the mill rate DOWN so that the net result for them is about the same. Is there a law against that in Harrisburg???"

Yes, I just quoted my previous blog entry, but I admit I'm getting tired of spouting the same old argument. Isn't this getting a little old, Dan? Can you please stop wasting county money on defenseless ever-appealed court cases?

Parking Garages Versus Port Authority

Brian O'Neill makes a very important point about parking garages in his latest editorial:

"Suburban commuters, the people most affected by any uptick in parking rates, have no vote in the mayoral election."

He makes that note near the end of his editorial and then he drops it, but somehow I will make a whole blog post out of this one line because I think he's looking at the tip of the iceberg of this thinly-veiled city versus suburb issue. City dwellers love the idea of leasing the parking garages and dealing with the city pension problem with the profits. Why? Because city dwellers DO NOT USE the parking garages. City dwellers take the bus or walk to work. We were just rated the 10th best walking city in part because a whopping 12% of us walk to work, the most in the nation after Boston. Another 18% take public transportation.

So, how about the city sells/leases the parking garages to the county? The county can manage them for the good of the county residents and then the city doesn't have to be responsible for taking care of suburban commuters at the expense of our city pensions.

Of course, the county doesn't want to buy the parking garages. Why would they? The county [read: Dan Onorato] also wants to contribute as little as is necessary for the upkeep and running of Port Authority. The county [read: Dan Onorato] also wants to keep the status quo of unjust property taxes. And the people that live in the county? They tend to think this is all a city problem, and they bemoan us city-dwellers for continuously voting in inept government that they have no control over. Well, suburban commuters, you do not have a mayoral vote, but you do have control over your government. You choose to not live in the city, you reject consolidation between city and county, and you vote for people like Onorato who undermine your cause by furthering the fractions between city and county despite boasting about the 2 municipality functions he's managed to merge.

And how did the city get in such poor shape? It seems to me that for a long time people thought it was easier to leave the city instead of help fix it. They were right. It was easier in the short-term, but now we're all paying for it - whether through higher taxes or parking rates. The big problem is that right now, the only one who's really profiting from it all is private parking garage owners.

How about the city offers to eliminate the dreaded parking garage tax, offers to keep ineptly running the parking garages (with their incumbent city pension issues and nepotism) and instead institutes a low wage tax on those suburban commuters? Is there any concession on the city's part that would make this palatable? County membership on the Parking Authority board? A citizen watchdog board made up of both city and county residents?

Let's work together to solve these issues. Let's all elect officials who will actually work together instead of giving lip service to a joke of a consolidation plan. Let's make Pittsburgh and the region stronger instead of just tearing each other apart.

Bright Lights, Big City

So the North Shore casino is looking for jumbotrons? And the city has an obnoxious legal battle with Lamar over electronic billboards?

I know I'm not the only one to think that some zoning compromise could come out of this if the right people sat down at a table together. Otherwise, the city is just asking for trouble (from Lamar) if it approves the jumbotrons on the North Shore.

Personally, it all sounds rather garish to me, but we are talking about a casino - a casino which stands to save taxpayers loads of money on property taxes if we're to believe Rendell and the Meadows hype.

According to the Rivers Casino website:

"Whether you prefer the exciting atmosphere of our gaming floor or the tranquil surroundings along our riverfront esplanade, our facility will be a premier destination for residents and visitors alike."

Their rendering of the casino is clearly of the tranquil side. They forgot to mention the light and noise pollution of traffic arriving at all hours and flashing electronic billboards. Who is that designed to appeal to? The greedy business owners who can't get enough?

On Property Tax

For those of you who may have missed it, Onorato attempted to address my property tax question during his cyber town hall meeting. I was pleasantly surprised to see my question addressed and not tossed aside. I was also pleased to hear him attempt to tackle other tough questions, and I was pleased to see him reaching out to the community, especially involving high school students, in such a down-to-earth accessible manner.

However, I have to say I wasn't completely satisfied with his answer.

He made many points (which I've paraphrased below.)
1) The 2001 and 2002 assessments were performed very poorly.

I have no idea why there were back-to-back re-assessments in this county. That was before my time. Clearly, there is absolutely no need to waste tax-payers money re-assessing every single year. I'd be perfectly happy with a planned 3-4 year cycle of re-assessments.

2) The city spent a lot of money and time on appeals relating to the 2001-2 re-assessments.

If those re-assessments were performed so poorly, then the team should be fired, and a new re-assessment team should be hired. If 180,000 people filed appeals, that's a broken re-assessment system.

3) He canceled the 2006 re-assessment (which he is proud of.)

Let me share a story. While I was living in Connecticut, the state found that the emissions testers were corrupt. They temporarily canceled all emissions testing in the state while they attempted to create a new clean system. Then a few years later, they re-started emissions testing with the new system in place.

If Dan Onorato were in charge of emissions testing in Connecticut, his analogous response would have been to cancel emissions testing forever because the particular system wasn't working. He would defend this stance for the rest of his term by pointing to how corrupt the old system was.

4) He said that 85% of property values increased when properties were re-assessed.

Let's get something straight. Housing prices (in a normal society) increase. It's perfectly natural and expected that prices will increase. In fact, if housing prices didn't increase we'd be in trouble. HOWEVER, the increased value of an assessed house SHOULD NOT mean increased property tax. When values go up, the county or the city or whomever, SHOULD adjust the mill rate DOWN so that the net result for them is about the same. Is there a law against that in Harrisburg???

He said: "County school districts and the municipalities all base their property taxes off the assessed values". If these school districts and municipalities refuse to lower their mill rate, then they are ripping off their citizens. That is where the offense should be - not the ridiculous stance of pretending property values haven't changed in 40 years.

5) Other counties around us follow the base-year assessment strategy.

In summation, Dan says all the other counties are refusing to fix the system, so why should he?
If all the other counties can break the law and propagate inequity, why can't he?

Dan, stop whining and do something about this unfair setup. That's how you'll prove you're capable of being governor.

More Money For Dan to Justify Spending on Roads

Allegheny County has been awarded $5.5 million from the Housing & Economic Recovery Act of 2008. Pittsburgh has gotten $2 million - the minimum permitted under law because the city and area have barely been hit by this national crisis.

It's ironic to me that Allegheny County is whining about needing to increase property taxes when the rest of the nation is severely suffering with foreclosed homes and abandoned properties. Shouldn't we be doing relatively well? Why is the county having a hard time balancing its budget? Does it have to do with a new sports facility?

Well, Allegheny County, here's some extra money for your budget. Under the act, the money is intended for "states and localities to buy foreclosed homes standing empty, rehabilitate foreclosed properties and stabilize the housing market." I'm sure that Onorato can find some way to justify spending this money on roads and bridges. Houses are adjacent to roads after all, and you can't have a stable housing market without nice roads.

I will end this post with a (lengthy) plea to County Council:

I don't care if you raise property taxes, but pretty-please-with-a-cherry-on-top, re-assess property values. I'm echoing the Pittsburgh Comet here and I whole-heartedly agree with him.

Heck, you may find out that you don't need to raise the millage rate if your collecting money on housing values that actually reflect the cost of housing in this area. Pittsburgh and Allegheny County did not as a whole experience the housing boom of areas like Boston and San Francisco. However, certain neighborhoods have, like the South Side, and certain neighborhoods have had plumetting housing values over the past 6 years. It's ridiculous to double-penalize folks who live in houses whose values have dropped significantly, while double-rewarding folks like me whose property values have increased. Make me pay my fair share. Because I guarantee that I'm not about to make a donation in good faith to the county.

Rigging the Lottery

I'm not big on lots of quotes in my posts, but I couldn't pass up all the juicy whining tidbits I've included below.

The only justification when the drink tax was instituted was to give the County a way to pay for their share of transit system expenses. Period.

Roads may be "transit-related" but they are not "transit systems." The drink tax was not instituted to pay for road repairs.

County Solicitor Mike Wojcik argued that if the Legislature meant the Port Authority specifically, it would have said so, and bridges and roads can be defined as transit-related.

Laws in this state stay on the books for decades longer than they should (Johnstown Flood Tax for example) and if Harrisburg could envision a time when this Pennsylvania county might have more than one "transit system", or god-forbid change the name of their "transit system", then god bless them.

The drink tax was not instituted to add money to the county's fund balance, unlike what Amy Griser wishes.

County budget director Amy Griser testified that a $21 million hole in the budget would wipe out the county's fund balance and make it more difficult and costly for it to borrow money.

The drink tax was not instituted so that the county would never again have to raise property taxes, unlike what Rich Fitzgerald is dreaming of.

Council President Rich Fitzgerald, a Democrat, said that if Mr. McCullough and his allies win the suit, it would amount to a "straitjacket" on county spending and force a property tax hike to fund crucial infrastructure improvements.

Poor planning is no excuse to break the law and take advantage of taxpayers. Please, Judge Judy, don't let the whiners in the county rig the lottery. I want smart cards.

It's About Time

Pending paperwork, the "controversial" drink tax will be lowered from 10 percent to 7 percent for 2009.

The controversial drink tax, which took effect in January, is to be dropped from 10 percent to 7 percent, but that could force the county to raise property taxes as soon as next year, said Councilman William Robinson, chairman of the Budget and Finance Committee.

I understand that the economy is sinking nationally and there may be some concern that a tax based on consumption is not reliable in a poor economy. However, one thing I'm willing to bet on is that when people are down in the dumps, they buy more liquor. My gut says that we'll see an increase in liquor spending in 2009. Of course, we may not be going out as much so the County may want to consider an extra tax on store-bought beer and wine in order to capitalize on the recession.

Finally, Mr Robinson, I have to ask you a question. You made an extra unexpected $8 million this year from the drink tax!!! If you were so concerned about the county having enough money next year, why not save some of that money instead of voting to spend it anyway Dan the Tax Man chose?? Also, why shouldn't property taxes increase as expenses increase?? Why the insistence that bar drinkers in this county should pay for any and all cost increases in this county???

EDIT: Make that an extra $12 million and counting...

50% Property Tax?

This is the clearest indictment I can find for base-year tax assessments.

The city is trying to sell properties for under $10,000, some in the vicinity of $3,000 that need total rehabilitation, yet the property taxes are upwards of $2,000 per year. Clearly, it would be best for the city, if investors buy and rehabilitate these properties, but within 2 years they would double their purchase price.

We're talking about a potential 50% property tax rate here.

Why?

Because these homes are valued using an antiquated system of base-year tax assessment. 10 years ago, they might have been in fine shape and now, they're symptoms of neighborhood rot that the city should be giving away. Yet the county insists this is a perfectly valid means of valuing homes. I want some of that happy-go-lucky pot they're smoking, too.

Thanks again Dan for your excellent executive prowess!

Signs of Reason?

Mr Onorato in recommending lowering the drink tax to 7% has finally caved to partial reason proving he hasn't yet gone completely insane.

"Because of that [over-abundance of revenue], Mr. Onorato, who said he will use this year's excess drink tax revenues for infrastructure development and debt service, plans to trim the levy to 7 percent in his 2009 budget proposal, which he will present to County Council on Oct. 7."

3 Issues Remain:

1) How come Port Authority still hasn't seen ANY of this money and is at risk of going bankrupt?

2) Why does Dan feel that he can spend the extra money on "infrastructure development and debt service"? If the county needs more money, raise and/or re-assess the property tax in this danned county! Why not set aside a special loan fund for helping out beleaguered restaurants and bars? Or how about more money for ailing Port Authority since that's what the drink tax was collected for? Or how about a simple rebate for these bar and restaurant owners? Ever heard of fostering good will, Dan?

3) What impact does the car rental tax have on all this? Every article always ignores the rental car tax revenue. Is it just generating such a negligible income that it should be removed? Is it hurting our tourist economy in any way? Is it hurting our many low-income residents who rely on renting a car to get out of the city because of our abysmal inter-city public transportation options?

(reference: http://www.post-gazette.com/pg/08269/914883-46.stm)