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Audit finds flaws in OPA’s methods for conducting property assessments

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Council members are calling for an OPA reform

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City Council is calling for several changes to the Office of Property Assessments (OPA) after an independent audit this week revealed issues with how OPA conducts assessments.

The audit was completed by J.F. Ryan Associates, an independent consulting firm, whom council members hired last year to look into OPA’s methods for conducting assessments. The decision came following a shocking round of property assessments OPA released in April, showing an average property increase around the city of 10.5 percent, according to an analysis by Philly.com.

In their months of research, the consulting firm found several failings in OPA’s method: The assessments weren’t uniform; assessments did not meet industry standards for homes from one to four families, commercial, and industrial properties; and plots under $100,000 were overassessed, according to a statement from council and the audit.

“Just as many members of Council and the constituents we represent feared, too many property assessments on which City property taxes are based are unacceptably inaccurate and inconsistent,” Council president Darrell Clarke said in a statement last week.

Mayor Jim Kenney’s office also responded to the news, saying they welcome the audit but noting several concerns, which Mike Dunn, spokesperson for Kenney’s office detailed in an email this week. He said the firm relied on preliminary, not fully validated data; the audit didn’t make any specific suggestions for reforming the system; and they inaccurately claimed OPA hasn’t implemented many recommendations made from an earlier, 2012 audit.

“By using faulty data, and by offering no recommendations for reform, the value of the audit toward improving the work of OPA is extremely limited.”

Regardless, Dunn said the office is taking the “spirit of the auditor’s concerns seriously,” and that OPA has hired another outside consulting firm to examine their methods and provide recommendations on ways to improve.

But Clarke and City Council listed some of their own recommendations last week, saying OPA needs to hire a new chief assessment officer and four new deputy assessors, and they need to contract with outside appraisal firms to increase their accuracy, among other suggestions.

“The failure to ensure property data are accurate isn’t just about fairness -- it’s about ensuring stability in our neighborhoods and earning the trust of residents and business owners,” Clarke said in the statement, adding that council members have been “sounding the alarm” about OPA’s accuracy for years.

The mayor’s office took issue with council’s claims about OPA’s leadership, saying the office has made “tremendous strides” in improving their accuracy.

“It would be inappropriate, and frankly unfair, for the OPA team to become political scapegoats in light of the progress they have made,” Dunn wrote in the statement. He added, as a reminder, that Michael Piper, who currently serves as the head of OPA, was approved by council in 2014.

The property assessments in April created a ripple of concern, as the increase in property values would likely mean an increase in property taxes. Council addressed the concerns in several meetings last spring, when they first called for the audit, and later, considered a bill that would give council the final say on OPA’s assessments.

This is not the first time that the question of how the city assesses property values has come up. In 2014, the city implemented Actual Value Initiative (AVI), which ensured that each property would get assessed at its current market value.

“The purpose of AVI has been to make sure that all values are assessed fairly and in compliance with state laws, statutes, and industry standards. It ensures that properties of equal value get the same assessments,” OPA’s website states. In assessing properties, OPA looks at the size and age of a property, its location, and its use.

AVI was meant, in part, to increase the frequency with which the city assessed property values. A 2012 report from PEW wrote that before AVI, some properties hadn’t been assessed in 10 years, and others, not since the 1980’s.

Among the findings of the audit:

  • Property assessments are not uniform
  • Assessments don’t meet industry standards for homes from one to four families, commercial, and industrial spaces
  • OPA has failed to fully explain how the individual assessments are conducted on the OPA website, and have failed to meet 11 out of 18 of its responsibilities.
  • Properties under $100,000 are overassessed

Among City Council’s suggestions for improvement:

  • Recruit new leadership for OPA
  • The new Chief Assessment Officer should have three or more years of experience in the position; management experience in at least two cities; experience with a mass appraisal computer system; and at least five years as a member of International Association of Assessing Officers
  • Contract with a mass appraisal firm to improve accuracy
  • Contract with a broad appraisal firm to obtain mass appraisal services and monitor successful bidders
  • Identify and correct assessment outliers by the end of March

  • Philly home values spike in new property assessment [Curbed Philly]
  • Philly’s new property assessments are out [Philly.com]
  • Bill introduced to give council the final say on property assessments [Curbed Philly]