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Philly tax delinquents cost city, neighbors

| Monday, March 11, 2013, 12:24 p.m.

PHILADELPHIA — Tax-delinquent properties in the city of Philadelphia have crippled the tax base, eroded the equity of thousands of homeowners and starved city government and school district of badly needed funds, a Philadelphia newspaper said.

A yearlong Inquirer/PlanPhilly investigation of the tax enforcement system found that delinquency depresses the overall property tax base by at least $9.5 billion, almost 10 percent of Philadelphia's $98.5 billion in taxable real estate, the newspaper said.

The delinquent properties lower the worth of neighboring homes by an average of 22.8 percent, and few neighborhoods are untouched.

Eliminating such delinquencies could increase the tax base by almost $300 million a year, the paper said.

While some of the properties are owned by low-income homeowners unable to pay their bills, at least 59 percent of all delinquent real estate in Philadelphia is owned by landlords, speculators and investors who don't live on-site, the paper said.

Other large U.S. cities, on average, collect 95 percent of what they are owed in property taxes in the same year they are due, and the average collection rate climbs to 99 percent in later years with enforcement measures that can include auctioning properties, the paper said.

Philadelphia' collection rate has come in well below those rates, averaging 85.6 percent annually since Mayor Michael Nutter took office, 10 points below the average rate of the 20 largest cities over the same period.

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