Survey Says: Pennsylvania Property Tax Certification Clearance Process Needs Changing, Private Company Agrees

News provided by

Nov 06, 2013, 09:00 ET

TRENTON, N.J., Nov. 6, 2013 /PRNewswire/ -- Private, public record research company Signature Information Solutions LLC ("Signature") supports findings of a Pennsylvania Land Title Association ("PLTA") recent industry study indicating professionals involved in real estate transactions in Pennsylvania want a change to the current property tax clearance process. Determining the payment status of property tax payments -- typically referred to as a "Tax Certification" -- is needed on a timely basis for real estate transactions to determine outstanding amounts and to satisfy or prorate them at the closing table.

The PLTA is a state-wide advocacy group representing title insurance agents and underwriters, real estate attorneys, and other real estate professionals serving Pennsylvania. ORC International, a leading global market research firm, conducted the survey on behalf of the PLTA.

The study reports that, "The results show the majority of respondents would not recommend the current process be adopted by other states and would change the process if they could."

The report continues, "These sentiments are even stronger from the group of respondents who personally deal with the elected Tax Collectors and who manage the highest number of real estate transactions per month."

The report also cited that 4 out of 5 of those who manage high order volumes and/or obtain such information daily would change the process with more than half showing strong feelings because they would definitely change it.

"The results of the survey do not surprise us at all," said Patrick T. Roe, General Manager at Signature. "We have been in this business since 1996, and have dealt with the many inconsistencies with turnaround time and fees. The elected tax collector who actually owns the data has no legislative or statutory responsibility to provide it for the real estate closing. This has adverse consequences for the Pennsylvania consumer."

Signature recently produced a white paper on "How to Fix the Pennsylvania Tax Certification Process" which draws from the PLTA study and outlines challenges with the current government system. You can read the white paper at https://www.signatureinfo.com/notice_files/How to Fix the PA Tax Certification Process-2013.pdf. Some of the points made in the paper include:

Governmental inconsistencies, which include both fees and turnaround time;
"Zip code discrimination" – with "home" zip codes receiving more favorable service than those outside the fulfilling tax collector's area;
And recent legislation that seeks to protect the status quo and favors the financial interests of the locally elected tax collector over the interests of the Pennsylvania consumer.

The paper acknowledges that there are some elected Tax Collectors who do an outstanding job and provide a fair price and quality turn time. However, the paper further states,"…there are others who may allow up to two months to pass before issuing the Tax Certification and charges can total upward of $195 to provide this vital public record information."

The paper also focuses on favoritism by elected tax collectors that it refers to as "zip code discrimination." The survey results state, 'While 65% say they have generally positive experiences when obtaining the information from their local tax collector, only 49% say this is the case when obtaining the information from tax collectors outside of their area.' More than half of the respondents who deal with procuring this information have negative experiences trying to obtain it from elected collectors in other regions of the state. This is problematic as it is giving one business a competitive advantage over another based simply on their zip code, and results in Pennsylvania consumers receiving disparate treatment."

It also discusses pending legislation that may further cement the current process. Pennsylvania Senate Bill 444 ("SB 444") seeks to amend the current "Right to Know Law" and exempt property tax information while requiring elected Tax Collectors to establish "a process to provide a clearance certificate." The paper states, "The current version of Senate Bill 444 appears to favor the financial interests of the elected tax collector over the interests of the public citizen who needs timely and reliable access to the information maintained by the collector. By exempting property tax information and asking for a process to be established that has no deadline for implementation, no maximum fulfillment time frame, and does nothing to rein in fees that are sometimes exorbitant, the legislation effectively creates a government monopoly with consistently poor service that does not benefit the citizens of the Commonwealth of Pennsylvania."

"Protecting the status quo is not in the best interest of Pennsylvania consumers," Roe said. "In neighboring New Jersey, these records are openly public and allow private industry to relieve government of their labor burden and provide higher service levels. We believe that SB 444 should either declare the tax payment records as public records or tighten the parameters of the proposed process to establish clear service level standards with reasonable fees. As currently drafted, it will perpetuate the existing problem that the majority of the respondents to the survey indicated they wanted changed."

About Signature:
Signature Information Solutions LLC is a regional public record information firm that provides due diligence products to the title insurance, lending and legal markets in NJ and PA. The company traces its roots back to 1911 and its tax searching history to 1985 with the first privately produced NJ Tax Search. The Company seeks to provide the same high quality product in Pennsylvania as it does in New Jersey, where most searches are processed in less than one business day. This allows title insurance and settlement professionals to expedite closings, helping to keep consumers' real estate closings on time without unnecessary disruptions.

About the PLTA survey:
Interviews were conducted September 5-19, 2013 by ORC International, which is based in Princeton, New Jersey. Margin of error: +/- 4.6%. Ninety-four percent of the respondents indicated that that they both live and work in Pennsylvania. The results are based on 456 responses to online interviews with five groups: