“Winners and losers” — It’s a phrase heard often on the floor of Philadelphia’s City Council, especially popular when it comes to taxes. The phrase peppered the debate over the city’s move to the Actual Value Initiative last summer, as Council grappled with questions over who stood to gain most or be hurt by the citywide reassessment.

And the phrase has come ’round again, as Council prepares to figure out the last pieces of AVI, including the so-called homestead exemption, which forgives taxes up to a certain limit for resident homeowners. Council already set that rate at $30,000 — but Council can still raise it, lower it, or throw out the exemption altogether. There will, of course, be “winners and losers” — and the point at which they separate, the so-called “Tipping Point,” depends on Council’s decisions.

On its face, the homestead exemption would appear to make for a lot more “winners” than “losers.” Estimates vary, but the city administration guesses something like 320,000 of the city’s roughly 469,000 residential properties (and 579,000 properties citywide) would qualify. Officials expect that about 90% of eligible residents will apply.

But getting the exemption doesn’t necessarily make a homeowner a “winner.” The homestead exemption, after all, comes with the price tag of a hike in the overall tax rate, which current estimates have moving from around 1.25% to around 1.4%. The exemption, meanwhile, becomes less valuable the higher a property’s value is until, at some point, the higher tax rate costs more than the homestead exemption saves.

Right now, the Tipping Point is estimated to be between $280,000 and $300,000, depending on various factors. Residents whose houses are worth less than that will save money from the homestead exemption; those whose homes are worth more will pay more in taxes.

Roll over the graph to see how the property tax changes for a property under a plan with 1.25% tax rate and no exemption, and a plan with a 1.4% tax rate and a $30,000 homestead exemption. -- Casey Thomas

As the politics around the proposed exemption are shaping up, two main schools of thought have emerged. The first, espoused lately by At-Large Councilman Wilson Goode Jr., holds that the exemption is good policy because it benefits the most homeowners. “The way [AVI] gets the most buy-in,” Goode said on Wednesday, “is to have as many people benefit from the transition as possible.”

On the other side is At-Large Councilman Bill Green, who contends that the exemption represents “a teeny benefit that has a great effect on businesses and everybody above the tipping point … I don’t think it’s reasonable to say people shouldn’t pay their fair share for the same services.”

The debate is less about mathematics than philosophy.

Goode is right that the number of homeowners who save taxes with the exemption far surpasses the number of residents who pay more (though by little more than $100 or $200 in most cases).

According to an analysis by AxisPhilly, using data from the Office of Property Assessment, only 10 percent of properties citywide would see any increase in their bill if the homestead exemption were enacted. Of that 10 percent, the six whose houses are worth $350,000 or less would pay no more than $105 in additional taxes. An additional three percent with properties worth up to $500,000 would pay a maximum $330 in additional tax.

Green, on the other hand, is right that the homestead exemption has a large impact on the owners of commercial properties — a broad category encompassing everything from bodegas to skyscrapers. Because many of the most expensive commercial property (much of it in Center City) hasn’t been undervalued, commercial properties collectively stand to see tax savings of as much as $60M under a 1.25% tax rate — making them the winners so far over all.

But the same properties would see the largest impact from a homestead exemption. Our analysis shows that commercial properties would collectively still get a tax break with a $30,000 homestead exemption in place, but for about half as much — around $30 million. What’s more, the least-valuable 50 percent of commercial properties, already facing potentially large increases in their “use and occupancy” taxes, might, unlike their wealthier counterparts, actually see a property tax increase with a $30,000 homestead, just shy of half a million dollars.

It’s the opposite effect the homestead exemption would have for residential homeowners: when it comes to commercial property, the “poor” businesses get poorer.

Still, taking a slice of tens of millions in tax breaks for wealthy companies doesn’t strike everyone as a bad thing — especially when that money would effectively be put right into the hands of lower-value residential homeowners.

And “one of the only ways to shift some of the burden back to commercial,” asserts Goode Jr. “is through the homestead.”

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See what areas of the city have the highest level of owner-occupied properties (only homeowners living in their residence qualify for a homestead exemption).