Philly won’t reassess properties this year to catch up on appeals backlog, officials say.

Philadelphia won’t reassess property values this year as it works through thousands of property owners’ challenges to valuations released last year.

That increases the likelihood that whenever the city does next reassess properties, those valuations — and their corresponding real estate tax bills — will be less accurate and equitable. Homeowners will also experience multiple years’ worth of property value increases in a single assessment, raising the chances they’ll appeal in large numbers again. And the city and school district will lose out on revenue that they’ll never make up.

Mayor Jim Kenney announced that decision Thursday as part of his final budget address. Last year, the city released its first reassessment in more than three years, drawing outcry from homeowners who saw their property values increase by 31% on average citywide — and even higher in some gentrifying neighborhoods.

The mayor blamed the delay on administrative burdens brought on by giving property owners months more than initially planned to file appeals — called first-level reviews. “There will not be a revaluation for Tax Year 2024 due to extending the first level review deadline,” his budget proposal states.

Kenney — whose administration has faced criticism and clashed with City Council over property assessments — will leave office in January, leaving the next revaluation to his successor.

“We will continue doing evaluations starting next year,” said Rob Dubow, director of finance, in a budget briefing Wednesday.

Prior to 2022, Philadelphia last released a citywide reassessment in 2019. The city’s Office of Property Assessment has said it aims to reassess property values every year, which would improve accuracy.

“It is OPA’s goal to conduct assessments annually,” a spokesperson for the Kenney administration said in November. But “given the many factors at play, we’re unable to commit to a specific frequency.”

Officials had been working toward conducting a reassessment for months. In January, Chief Assessment Officer James Aros said he was unsure he’d have the resources to complete a reassessment this year because his office was resolving appeals on a later timeline than usual. The deadline to file an appeal for review by the Office of Property Assessment was extended twice last year, from September to October, and later until December.

Industry experts say irregular and infrequent assessments make it harder to assess properties accurately and equitably. An Inquirer analysis found that property assessments are systemically inaccurate and distribute the tax burden unequally in their current form, affecting Black and low-income neighborhoods the most.

Three- to four-year gaps between assessments also mean that homeowners can experience greater sticker shock because they see several years of increase at once. After the 2023 reassessment was released last year, owners of more than 26,000 Philadelphia properties challenged the city’s values — the highest volume since 2014, when the controversial Actual Value Initiative went into effect.

The city paused reassessments during the pandemic to implement a computerized mass appraisal system with the aim of assessing properties faster and more effectively. The mayor’s proposal also outlines plans to upgrade the office’s data infrastructure.

Yearly reassessments are considered the gold standard. Few jurisdictions are able to conduct them that frequently, but Arizona, Texas, and Florida have laws mandating annual reassessments.

About half of Philadelphia’s property tax revenue funds the city’s operations and about half goes directly to the school district. School funding is typically tied to local tax bases because revenues grow as the tax base grows — but that’s contingent on regular reassessments to capture increases in property values. When Philadelphia skips a reassessment, the city and the school district both lose revenue that they’ll never get back.

Brett Mandel, a former assistant city controller who has sued the city over its assessment methodology, said the delay should come as no surprise given the city’s long-standing aversion to citywide reassessments prior to AVI. But such delays only continue to accelerate the problems of accuracy and equity.

“The whole point of the ‘re’ in ‘reassessment’ is that you do it again and again,” Mandel said. “If you do it once, you should do it every year, and if you don’t do it, you create a bigger problem.”