ipti xtracts · the change has drawn support of big real-estate groups. ... while old-timers...

IPTI Xtracts Property Tax and Assessment New From Around the World- For Information Purposes Only

IPTI Xtracts International Property Tax Institute

www.ipti.org *The items included in IPTI Xtracts have been extracted from published information; IPTI accepts no responsibility for the accuracy of the

information or any opinions expressed in the articles

USA ● What’s Inside – March 2015

THE ARIZONA lag on property-tax rates could end by 2018

INDIANA - Mysteries of property assessment

MASSACHUSETTS - Tax exemptions can cost towns

WISCONSIN - Mondelez and Walgreen lose Winnebago County property assessment challenges

To Fight Inequality, Tax Land

GEORGIA - Home Depot To Get 200 Million Dollar Property Tax Break

INDIANA - Errors in property assessments hardest on low-income homeowners

MAINE - Maine Effort to Tax Nonprofits Raises Eyebrows Across the US

MARYLAND - How accurate are state property assessments?

NEW YORK’S super-wealthy pay less on property taxes

NEW YORK - In Program to Spur Affordable Housing, $100 Million Penthouse Gets 95% Tax Cut

NEW YORK - The Quest for a Limit on Property Taxes

WASHINGTON - D.C. still studying ways to improve commercial property assessments

WISCONSIN - Town of Carlton, Dominion wrestle with nuke plant value

USA - The 10 worst states for property taxes

NEW JERSEY - Property tax appeals down in Central Jersey

_____________________________________________________________________________

THE ARIZONA LAG ON PROPERTY-TAX RATES COULD END BY 2018 Metro Phoenix homeowners saw their values climb an average 7 percent when they received their latest property valuations last week. Many may expect to be taxed on the higher worth of their house this fall. That's not going to happen, at least not this year anyway. In September, Phoenix-area homeowners will be taxed on valuations they received a year ago, when the average value of a house in the region jumped 23 percent. In Arizona, there's an 18-month lag between property valuations, and the tax bills tied to them. Confused? Arizona's property-tax system, considered one of the most convoluted in the nation, is baffling to many. But all of the state's county assessors are trying now to simplify the process with legislation to do away with the year-and-a-half span between valuations and correlating taxes. House Bill 2253 calls for property owners to be taxed on the valuation they receive in February by October starting in 2018. The change has drawn support of big real-estate groups.





"By shortening the time (between valuations and tax bills), the assessed value more closely aligns with value of the property," Arizona Association of Realtors CEO Michelle Lind told me. "In the last economic downturn, numerous homeowners were concerned and dismayed when their tax bill arrived because their assessed property value was substantially higher than the actual value of the property," she said. The 18-month lag was built into Arizona's property-tax system to allow property owners time to appeal their valuations, something that doesn't always lead to lower taxes. Robert Pizorno, communications director for the Maricopa County assessor, said property owners will still have time to appeal with the change to a one-year cycle for property valuations and taxes. The legislation calls for the appeal time to go from 60 to 45 days. Appeals dropped more than 50 percent last year, something Pizorno attributes partly to a law passed in 2012 that limits the increase on a specific valuation to no more than 5 percent a year. A quick explanation of Arizona's property-valuation system: -- The full-cash value, listed first on a valuation report, is a conservative estimate of what a house is worth and should be 10 to 20 percent less of what it can be sold for now. -- The limited-cash value is based on a complicated ratio of full-cash value and is what property owners are taxed on every year. The limited value can't be more than the full value and now can't by law increase more than 5 percent annually. Valley homeowners have until April 21 to appeal their new valuations. Two important things for homeowners to consider: A lower valuation could potentially mean a lower sales price; a higher valuation doesn't always translate to a higher tax bill. During the real-estate crash and recession, home values plummeted in metro Phoenix, but property taxes climbed as municipalities and other government entities raised their rates to cover other budget shortfalls. Cities, counties, schools, libraries, fire districts and other taxing jurisdictions decide what they need from property owners during the summer and set their rates for fall bills. Valuations can be appealed in Arizona, but property taxes aren't up for discussion, debate or dispute after the rates are set in June and July. In Arizona, property owners who want to have a say in what they pay in taxes can go to the open, public meetings held by the government entities. Homeowners surprised or angry by what they owe this fall will have missed their chance to have a say in their property-tax bill. _______________________________________________________________________________________________________

INDIANA - MYSTERIES OF PROPERTY ASSESSMENT

Our starting point is the Indiana Department of Local Government Finance’s (DLGF) Table 3 in its “Report on Property Tax

Exemptions, Deductions, and Abatements - 2014.” Here we obtain data for assessments in 2011 and 2012 used for property

tax bills payable in 2012 and 2013. If that’s confusing, welcome to the wonderfully weird world of property taxation.





Property taxes are paid on the basis of Net Assessed Value (NAV), which is GAV minus the Exemptions, Deductions and

Abatements detailed in that report. Those three witches of property taxes reduce GAV by about 30 percent. They are the

tax preferences given by Indiana’s Legislature to selected property owners, mainly Hoosier home owners. They do not

reduce property taxes collected; they only shift the amount collected from one group of taxpayers to another.

Total GAV in Indiana declined by $4.1 billion between pay 2012 and pay 2013. It sounds like a lot and it is, until we recognize

it’s only 0.9 percent. Yet, why should GAV drop at all? Wasn’t 2012 a better year than 2011? Didn’t we hear that our state’s

economy was among the growth leaders in the nation? Shouldn’t more residential, commercial and industrial investment

be reflected in our GAV?

There are many questions: How can we explain why 39 counties had increases in GAV as high as 8.3 percent in Pike while 53

counties had decreases as low as -8.4 percent in Jasper?

What was happening in Vanderburgh for that county to lose $846 million (6.9 percent) in GAV between 2011 and 2012 (pay

2012 and pay 2013)? That is greater than the sum of the gains made in GAV by Marion, Boone, Monroe and Bartholomew

counties combined.

Hamilton County is Indiana’s great population growth leader, but it lost $3 million in GAV. True, that’s only 0.2 percent down

from the previous year, but it’s not what we would expect. While other Indianapolis metro area counties grew, Hendricks

County too declined (-0.9 percent). Is it only statistical noise or a goof in the county courthouse? The answers are to be

learned in Noblesville and Danville.

We have heard about the pickup in manufacturing and that Indiana is ahead of the nation. Then why are the seven biggest

losers in GAV growth (St. Joseph, LaPorte, Elkhart, Kosciusko, Vigo, Porter and Vanderburgh) all among our state’s most

prominent manufacturing counties?

There must be answers to these many questions, but they are not to be found in the DLGF report submitted to Senator

Kenley, Chair of the State Budget Committee.

____________________________________________________________________________________ MASSACHUSETTS - TAX EXEMPTIONS CAN COST TOWNS On paper, the valuation and percentage of tax-exempt property in some Greater Boston communities could make taxpayers wonder if everyone is paying their fair share.





In Chelsea, 30 percent of the property is tax-exempt; in Foxborough, 23 percent is not subject to tax; and in Lincoln, the figure is 18 percent. From bridges to parks to Gillette Stadium in Foxborough, state law allows a patchwork of diverse interests to avoid paying property taxes. Exemptions are given on property owned by the state, federal government, cities and towns, and registered nonprofits, which range from hospitals and universities to soup kitchens and houses of worship. While some state agencies voluntarily pay host cities annual fees for the tax-exempt land and some nonprofits willingly enter into cash agreements with municipalities — known as payment in lieu of taxes — leaders of cash-strapped communities are increasingly asking tax-exempts for funds. In Chelsea, the Tobin Bridge is valued at $520 million by the city, amounting to more than half of the city’s $1 billion in tax-exempt property. MassHighway, which owns the bridge, pays Chelsea $600,000 annually as a host fee. Chelsea, Lincoln, and Lawrence are among communities in Massachusetts with the highest percentage of these properties. While old-timers complained bitterly when the bridge opened in 1950 — dividing the city’s neighborhoods — most have come to accept it. Chelsea Treasurer Bob Boulrice said that without the bridge, the city’s tax-exempt valuation ranking — sixth in the state — would probably go unnoticed. “The numbers are skewed because of the bridge,” he said. Policy decisions by some communities, such as Lincoln, have led to the town’s large cache of tax-exempt places. Lincoln, which ranks 32d in tax-exempt valuations in the state, has made a deliberate effort to purchase conservation land. The town now owns 1,522 acres of open space, complementing the nonprofit Lincoln Land Conservation Trust’s 517 acres and the federally owned Minute Man National Historic Park’s 330 acres. “This preserves the character of the town and limits development, especially in environmentally sensitive areas,” said Ellen Meadors, a member of the Board of Assessors and the Lincoln Land Conservation Trust. Meadors and other leaders of the town of about 6,300 residentsbelieve that controlling the conservation land — as opposed to allowing new housing to be built — is more cost-effective and boosts property values. In Lincoln, the average single-family home is assessed at $1.01 million. “If you develop that land, the cost of services — police, fire, and schools — would be very high compared with the cost of services for conservation land, which is very, very low,” Meadors said. The Hartwell Tavern in Lincoln is another tax-exempt property. Foxborough ranks 15th in tax-exempt property values in the state, but that number is misleading, said Randy Scollins, the town’s finance director. On the books, tax exempts account for $763.4 million, but $470 million of that is one property: the 24-acre footprint of Gillette Stadium. The town owns the land under the stadium complex — which also includes the ticket office, the Patriots Hall of Fame, the Pro Shop, and administrative offices associated with the Kraft family’s sports and entertaining holdings. Under the tax agreement with the Krafts, owners of the Patriots, for every NFL game ticket sold, the town receives $1.47. For other events — such as New England Revolution soccer games and concerts, Foxborough receives $2.55 a ticket. Last year, the town received $2.8 million from the Krafts. All of the stadium parking lots are owned by private companies and are taxed at commercial rates.





Scollins said the town has had a tax agreement with the Patriots since the team built its first stadium in 1971, and that extra cash has helped boost Foxborough’s economy. The Krafts also built Patriot Place in 2007, a shopping district adjacent to the stadium that brings in $2.5 million in commercial property tax revenuefor Foxborough. “We’re enjoying substantial tax benefits from that,” said Scollins. Some municipal leaders say the nonprofits benefit from city services, and thus should help pay for police and fire protection and snow plowing. And some mayors and town managers are trying to persuade larger nonprofits — which often are the region’s largest employers — to make annual voluntary payments. As state aid to cities and towns has dropped by double digits in recent years while executives’ salaries routinely climb over $500,000 at nonprofit hospitals, universities, and museums, some elected leaders have chosen to push for payments in lieu of tax agreements, or PILOTS. Adam Langley, a research analyst for the Lincoln Institute of Land Policy in Cambridge, believes voluntary PILOT agreements are part of a growing trend in the state. “The state is reliant on property taxes more than in other parts of the country,” said Langley, who added that 90 percent of all revenues from PILOTS in Massachusetts come from hospitals, colleges, and universities. Last month, Brockton Mayor Bill Carpenter sent out letters to 21 nonprofits seeking PILOT agreements. If all paid a share, the total would be $4.2 million, which would bolster the city’s public safety and school budgets. Brockton Hospital, which holds an estimated $70 million in nontaxed property, was at the top of the list. Brockton ranks 42nd in the state, with $1.058 million — 16.2 percent — of its properties tax exempt. To date, Carpenter has not heard back from any of the nonprofits. Brockton Hospital officials could not be reached for comment about the proposal. “We’re asking them to be good corporate citizens, and what we’re really asking them to do is help keep the city afloat,” said Carpenter. “If this trend continues, if the nonprofits continue to buy up commercial property and continue to make it all go tax-exempt, in the long run there’s no way that the city can financially survive.” Some smaller communities, such as Belmont, also have attempted to negotiate PILOT agreements, with scant results. In 2012, the town asked 38 nonprofits for cash. Some volunteered to give annual stipends to the town but none were willing to sign a formal PILOT agreement. According to the state Department of Revenue, Belmont receives $46,596 annually in PILOT agreements from tax-exempt properties, valued at nearly $703 million. Geoff Beckwith, executive director of the Massachusetts Municipal Association, believes its time for the state to create a law that mandates tax payments by nonprofits. “Having essentially a free ride at the local level, whereas other entities are paying the full amount, just isn’t fair,” he said. But Rick Jakious, chief executive officer of the Massachusetts Nonprofit Network representing about 700 nonprofits, said tax agreements can impact the ability to provide quality of life services.





“Municipalities are hurting, but we believe that trying to balance their budgets on the backs of nonprofits is shortsighted,” he said. Salem Mayor Kim Driscoll doesn’t think the state needs to enact a law requiring nonprofits to pay some form of taxes. Since taking office in 2006, she’s been persistent in trying to persuade the big ones to contribute to the city’s budget. The city’s largest employer, North Shore Medical Center, has agreed to pay $125,000 a year. Salem State University pays $100,000 a year and offers other services to the city. In all, the city receives $1.32 million a year from PILOTS. “I think it really has to do with the relationships you form with those entities in your community,” Driscoll said.

____________________________________________________________________________________ WISCONSIN - MONDELEZ AND WALGREEN LOSE WINNEBAGO COUNTY PROPERTY ASSESSMENT CHALLENGES Two prominent companies that sought reductions in their property assessments were denied Friday by the Winnebago County Board of Review. Walgreen Co. sought a $2.2 million reduction on the assessed value of six Rockford stores. Mondelez International sought a $1.35 million reduction in the assessed value for its Loves Park gum factory. Board of Review member Tom Ewing said he expects both companies to take their challenges to the state's Property Tax Appeals Board. Walgreen, which also challenged its assessment last year, submitted an appraisal that argued its six stores should be assessed at $5.9 million. The Rockford Township Assessor put the assessed value $8.1 million. The stores are at 2323 Charles St., 1145 N. Alpine Road, 1201 E. State St., 3929 N. Mulford Road, 3336 11th St. and 1602 Kishwaukee St. "Last year we didn't feel the case had been made," said Ewing, who with board member Barbara Cheney heard the Walgreen appeal. "This year I felt the same." When property assessments are challenged, appraisals are submitted by the challenger to argue for a reduction. The appraisals include values of what the challenger believes are comparable buildings. But in both the Walgreen and Mondelez cases, the board said several properties cited as comparable weren't suitable comparisons. "There seemed to be no rational basis for it," said Brad Benedict, a board member, of Mondelez's case. "It seemed a very weak argument.'

____________________________________________________________________________________ TO FIGHT INEQUALITY, TAX LAND In the lasting debate over Thomas Piketty’s book on outsized returns on capital, a significant fact has been obscured: If you exclude land and housing, capital has not risen as a share of the U.S. economy. If you're surprised, you're not the only one. Intuition suggests this capital-output ratio should be higher today than it was in the early 1900s. Yet, in the U.S., capital excluding land and housing has been roughly constant as a share of the economy since the mid-1950s, and is lower today than at the turn of the 20th century.





What has skyrocketed over the past several decades is the value of land and housing. In the New York metropolitan area -- an extreme example, to be sure -- the average price per square foot of land rose to $366 in 2006, from $47 in 1999. Rising land prices aren't limited to New York, and they remain large even after the effects of the Great Recession. From 1970 to 2010, U.S. housing capital as a share of the economy rose by more than 40 percentage points, and by much more than that in other advanced economies, as Matthew Rognlie of the Massachusetts Institute of Technology has found. That increase, furthermore, explains almost all the rise in measured capital as a share of the economy. “There has been a large long-term increase in the share of net income from housing for every country in the sample except Germany," Rognlie explains. "Meanwhile, the non-housing capital share shows no clear trend.” Perhaps it shouldn’t matter that land and housing play such a crucial role in the overall capital trend. The implications for increasing inequality remain the same, after all. Yet for our understanding of the economic processes at work -- and for fashioning appropriate policy responses to inequality -- it does make a difference. Joseph Stiglitz, the Nobel-winning economist at Columbia University, recently presented a paper arguing that Piketty has misdiagnosed the problem of wealth and income inequality, including by ignoring the crucial role of land and housing. And as a result, Piketty's policy proposals may do more harm than good. Stiglitz thus urges that policy makers distinguish between wealth, which includes land, and productive capital, which doesn't. The distinction is important because an increase in the value of land and housing -- unlike an increase in other forms of capital, such as computers and equipment -- doesn't necessarily increase our capacity to produce goods and services. It doesn't imply that we have any more land to use. Stiglitz also argues for imposing a land value tax, to directly address this source of increasing wealth inequality. Economists have long favored such a tax, because it does little or nothing to distort incentives: Since land is roughly fixed in supply, there's little one can do to escape a land tax. Indeed, from the perspective of economic efficiency, a land value tax scores higher than even a value-added tax, which is typically seen as the most efficient form of taxation. Furthermore, more than 30 countries have already implemented some form of land value tax. And the U.S. has some limited experience of its own, dating to 1913, when Pittsburgh and Scranton, Pennsylvania, imposed a higher tax on land value than on buildings. So here is a bold idea for a national candidate: Propose a national land value tax. It would highlight the fact that, except for land and housing, capital ratios have not risen here, despite Piketty's rhetoric. It would also be economically efficient and reduce wealth inequality. The revenue could be used to reduce other taxes, or to help close the actuarial deficits in our entitlement programs, or some combination thereof. Sometimes old ideas are good ideas. Henry George advocated forcefully for a land tax in his 1879 book, "Progress and Poverty." More than 135 years later, perhaps its time is ripe.

___________________________________________________________________________________ GEORGIA - HOME DEPOT TO GET 200 MILLION DOLLAR PROPERTY TAX BREAK Home Depot is getting a 200 million dollar property tax break from Cobb County. The county's development authority unanimously approved the break Tuesday. According to the "Marietta Daily Journal", Home Depot asked to borrow 200 million dollars from the authority to renovate its corporate headquarters and lease a building in Marietta. In turn, the home improvement retailer will get property tax abatements over the next 10 years.





Home Depot executives say their front offices are aging and need to be renovated to keep up with the company's growth. Vice President Michael LaFerle told the development authority that Home Depot could move out of Cobb, unless it received some kind of incentive to help pay for the renovation. _______________________________________________________________________________________________________

INDIANA - ERRORS IN PROPERTY ASSESSMENTS HARDEST ON LOW-INCOME HOMEOWNERS Indiana should review its property assessment practices because errors are causing some low-income homeowners to pay too much in property taxes while well-off homeowners pay too little, says a new study from Ball State University. “Assessment Quality: Sales Ratio Analysis of Residential Properties in Indiana,” an examination of property tax assessment by Ball State’s Center for Business and Economic Research, found that — for reasons that are unclear — low-value residential properties being over-assessed while high-value homes are under-assessed. “Accurate assessments are one of the difficult aspects of property taxation,” said Dagney Faulk, CBER’s research director who co-authored the study with CBER director Michael Hicks. “Ideally, sales price and assessed value would be close. Across the state, we find issues with the quality of assessment, on which property taxes are based. “These irregularities potentially harm low-income households since they pay higher property taxes, while high-income households pay less. In effect, those with less expensive homes may be paying a surtax that was never intended.” CBER researchers examined sales ratio of residential properties across the state by using data from the Indiana Association of Realtors and property tax rates from the Indiana Department of Local Government Finance. Sales ratio measures how close the sales price is to the assessed value. Residential properties represent less than half of the assessed value and property tax levy in the state, with commercial and agricultural property making up the balance. The study found: •Properties with sale prices of less than $100,000 tend to be over-assessed while properties with sales prices of more than $200,000 are under-assessed. •Assessment is most uniform for properties with sale prices between $100,000 and $200,000. This is also the price range with the most sales, so there are more data points to base assessments on. •Non-homestead (primarily rental) properties have much less uniform assessments – still showing the same pattern of properties with low sale prices being over-assessed and properties with high sales prices being under-assessed. Faulk points out that since 2000, there have been dramatic changes in Indiana’s property tax system — still the primary source of funding for local governments. These changes include a court-ordered reassessment, the implementation of trending to bring assessed value close to market value and the enactment of property tax caps. Efforts to improve assessment practices included a reduction in the number of government offices doing assessment and the implementation of computer software for mass appraisals in some areas, she said. Faulk said additional work is needed to better understand the cause of these discrepancies and to recommend ways to address errors. “Without further analysis, we cannot know the cause of the errors in assessment, only that they exist,” she said. “Future research will estimate property value based on the characteristics of the property and neighborhood, including socioeconomic, and compare the estimated property value with the sales price and assessed value. This will provide a far





clearer analysis of the cause and provide potential remedies to the errors in assessment we observe in Indiana’s residential properties.”

____________________________________________________________________________________ MAINE - MAINE EFFORT TO TAX NONPROFITS RAISES EYEBROWS ACROSS THE US Nonprofit organizations across the country are closely watching Maine as it considers becoming the first state to impose property taxes on hospitals, private colleges and summer camps under a plan being pushed by Gov. Paul LePage. The Republican's contentious proposal has sparked a fiery debate in Maine over what impact nonprofits have on their communities and whether they should have to shoulder the costs for municipal services they consume. It's also raising questions about whether other states will follow suit if LePage's effort is successful. "We are very much aware of it," said David Thompson, vice president of public policy for the National Council of Nonprofits. "I was talking to a group in Oklahoma about it and they looked horrified." All states exempt nonprofits from property taxes either through laws or their state constitutions, Thompson said. LePage has called nonprofits "takers, not givers" and argues they need to chip in for things like police, firefighters and snow removal. His proposal, which is part of his $6.3 billion budget plan, would require organizations to pay municipalities taxes if their properties are worth more than $500,000. They would pay taxes only on the property value over that threshold and get a 50 percent discount on the rate. Nonprofit groups contend the proposal would fundamentally change their long-standing relationship with communities, which is built on the understanding that they deserve to be tax-free because they improve the quality of life and provide services that the government would otherwise have to. In Maine, hospitals, colleges and other groups that are lobbying heavily against the proposal warn that it would force them to raise costs or slash jobs. The Good Shepherd Food Bank estimates it would owe about $24,500 annually to the city of Auburn under the governor's plan. Spokeswoman Clara Whitney said that would mean the food bank would have to provide 100,000 fewer meals every year. "If we have to redirect resources to pay property taxes it will be Mainers who are facing hunger who will be impacted," she said. Daphne Kenyon, a fellow with the Lincoln Institute of Land Policy who has studied the nonprofit property tax exemption, said the law could have a big impact in Maine, from lawsuits to nonprofits leaving the state. "It's always dangerous to go into unchartered territory," she said. Lawmakers in several states, including Maine, have examined similar proposals before, but none have been seriously considered, Thompson said. Virginia allows municipalities to decide which nonprofits should be taxed. In many states, nonprofits voluntarily agree to pay municipalities for the services they use in exchange for their tax-exempt status. While a small number of organizations already provide payments to Maine municipalities in lieu of taxes, those payments fall well short of the services those organizations receive, said Jonathan LaBonte, director of the governor's Office of Policy and Management.

http://abcnews.go.com/topics/news/maine.htm

http://abcnews.go.com/topics/news/us/gov-paul-lepage.htm

http://abcnews.go.com/topics/news/oklahoma.htm





Because the proposal is part of LePage's budget, which also includes a comprehensive tax overhaul plan, it's difficult to say whether it will survive as it makes its way through the Legislature. The governor's administration says that it's open to ideas for how to improve the proposal. "The governor put this in the budget to start the conversation," said LaBonte, who also serves as the mayor of Auburn. "If municipalities have another approach ... the governor has kept that door open."

____________________________________________________________________________________ MARYLAND - HOW ACCURATE ARE STATE PROPERTY ASSESSMENTS? Every three years, the state will reassess the value of your property. And because real estate taxes are calculated by using a combination of the tax rate and assessed property values, how your assessment changes can have a substantial impact on what you'll owe in real estate taxes. There is often a lot of discussion about how politicians might modify rates, but the equally important component of assessed values often flies under the radar. When assessed values are rising, as is currently the condition, you will frequently hear the pols crow about how they aren't increasing real estate taxes. But, all they're really talking about is the tax rate. Even if they don't increase the rate, tax revenues (and your tax bill) will still go up due to higher assessments. As a result, it's important to know how the assessed value of your home is determined and whether or not it is an accurate reflection of what your property is really worth. This year, all of the properties in Annapolis and southern Anne Arundel County were reassessed. That included our personal home in West River. The assessed value of our property from three years ago was $432,000; the new assessed value was $789,300, an increase of 83 percent. Now, we've only been real estate agents for 20 years, but we're fairly confident that the value of our house didn't increase by 83 percent in the last three years. Nor, do we believe we could sell the place today for anything near $790,000. Consequently, we decided to appeal our assessment. In preparation for our hearing, the state sent us a few pieces of paper, presumably to show how they came up with the $789,000 figure. We got something called the Property Record Card and, after a lot of digging, we were able to decipher how the record card is used in combination with AAVS Dwelling Cost Valuation Method to generate the assessed value of our home. There's no explanation of what AAVS is or how it works and even less information is provided about how they came up with the value of our land — a component of our assessment that increased by a whopping 123 percent. Nevertheless, we spent most of a snow day burning up Google in an attempt to understand how it all works. What we found was a bit disturbing. First, let's talk about the mysterious AAVS Dwelling Cost Valuation Method. Essentially, this is a computer program used by the state to estimate the value of property. In the private sector, banking, real estate and Internet firms have been diligently working to develop such programs. They're commonly referred to as AVMs, or automated valuation models. The problem is that these computerized systems are notoriously inaccurate.





The well-known real estate website Zillow is a multibillion dollar company, and they have invested heavily in AVMs. But despite all their effort, Zillow admits that the error rate for computer estimates of property values is very high. So, let's get back to the AAVS Dwelling Cost Valuation Method used by the state. AAVS stands for Assessment Administration and Valuation System. It's a computer program that cost the state about $7 million; it was launched in April 2011. In a December 2013 report by the Maryland State Office of Legislative Audits, here's what they had to say about AAVS: "AAVS had access vulnerabilities that placed critical assessment data at risk of unauthorized modification and certain historical data was not archived … Due to deficiencies in the AAVS program, system users could perform modifications to critical data via commonly used functions without detection. "As of February 27, 2013, we noted DAT (Department of Assessment and Taxation) was running a version of AAVS that was eight versions behind the currently available version. "DAT did not ensure a historical record of changes to AAVS data pertaining to assessments for the 2012-2013 tax year … As a result, the trail of assessment changes or other supporting data recorded in AAVS for that year is no longer available. "DAT did not maintain complete records of the automated real property system conversion to ensure all property details were properly transferred. "DAT did not establish procedures to ensure that certain data (such as property sales and permit information) received from local jurisdictions were properly recorded in AAVS." In short, the state just recently started using an AVM, and there are some fairly significant questions about its security and the accuracy of the information it uses. Plus, they are apparently running a vastly outdated version.

____________________________________________________________________________________ NEW YORK’S SUPER-WEALTHY PAY LESS ON PROPERTY TAXES New York City’s method of assessing property values is so out of whack that the buyer of the most expensive apartment ever sold — a $100 million duplex overlooking Central Park — pays taxes as if the place were worth just $6.5 million. With controversial tax breaks granted to the One57 condo tower, the total property-tax bill for the spectacular penthouse is just $17,268, an effective rate of 0.017 percent of its sale price. By contrast, the owner of nearby condo at 224 E. 52nd St. that recently sold for $1.02 million is paying an effective rate of 2.38 percent, or $24,279, according to data compiled for The Post by the Revaluate.com real-estate Web site. And even without the “421a” tax abatement for 157 W. 57th St., the bill would be $376,472, for an effective rate of just 0.376 percent. The figures, which Revaluate CEO Max Galka called “unbelievable,” show that the owners of the city’s 10 most expensive apartments pay effective rates that are a mere fraction of those paid on less-pricey properties. Beneficiaries of the discrepancy include casino magnate Steve Wynn, entertainment mogul David Geffen and Ekaterina Rybolovleva, the socialite daughter of Russian oligarch Dmitry Rybolovlev.





Experts blamed the situation on the city’s complicated method of assessing the “market value” of condos and co-op apartments. The off-the-mark assessment formula is primarily based on the income, per square foot, that’s generated by neighboring rental apartments. “It’s a big problem,” said George Sweeting, deputy director of the city’s Independent Budget Office. “It creates major inequities in the tax system. “The city has been asked to submit a plan to Albany since 1996 but no one ever has,” he added. The state law governing property assessments went into effect in 1981. Critics found its flaws almost immediately, and legislation passed in 1996 required that the city come up with a new method — to no avail. “The city uses an antiquated system to evaluate residential property that is completely out of date,” said Edward Mermelstein, a founding partner at the law firm Rheem Bell and Mermelstein. “New York City’s residential real estate has increased substantially in the last 15 years, and the system has not caught up.” “This is a serious problem that [Mayor] de Blasio needs to figure out,” he added. Galka said that while the city values apartments at about 20 percent of their actual worth, the top 10 are valued at between just 3 and 6.8 percent of their sales prices, generating just $935,000 in taxes this fiscal year. If those apartments were taxed at the national effective rate of 1.29 percent of sale prices, the city would pocket nearly $9 million, Galka said. In a prepared statement, de Blasio spokesman Wiley Norvell said: “These inequities have been built into the tax system over decades, and they won’t be solved easily or quickly.” “Any solution would require tax-law changes in Albany, and the impact of those changes on the lives of New Yorkers would have to be taken into account,” Norvell added.

____________________________________________________________________________________ NEW YORK - IN PROGRAM TO SPUR AFFORDABLE HOUSING, $100 MILLION PENTHOUSE GETS 95% TAX CUT The penthouse at One57, which offers panoramic views from 1,000 feet above 57th Street, recently sold for a record-setting $100.5 million. But it is not the price that has grabbed the attention of housing advocates, policy analysts, developers and city officials. Rather, it is one of peculiarities of New York real estate: a billionaire’s lair that comes with an incentive that cuts this year’s property tax bill by 95 percent, or an estimated $360,000. That has turned the six-bedroom, 11,000-square-foot duplex into a prime example for an intensifying debate over the future of a housing program known as 421-a. It offers generous property tax abatements for as long as 25 years to encourage construction, or in some cases, to generate apartments affordable to poor and moderate-income tenants. At a City Council hearing last week, critics derided the 421-a program as an expensive boondoggle, a giveaway to developers building luxury housing in a city where the poor and the middle class often find themselves priced out of the market.





“It’s time for 421-a to go away,” said Maritza Silva-Farrell of the housing coalition Real Affordability for All. “We are being forced to subsidize luxury developers who build apartments the vast majority of New York City residents cannot ever afford.” But the city’s developers contend that it is nearly impossible to build rental housing in New York today without the tax breaks, given the high costs of land and construction, as well as high property taxes. Without the incentives, they say it is easier and more profitable to build condominiums. “You’re not going to generate more housing production,” Steven Spinola, president of the Real Estate Board of New York, said, “by giving fewer tax breaks and asking for more affordable housing.” The debate about an otherwise arcane area of housing policy has taken on a sense of urgency because the 421-a program, which began 44 years ago, is up for renewal by the State Legislature in June. Mayor Bill de Blasio plans to plunge into the debate in Albany as he seeks every lever to make good on his pledge to build 80,000 units of housing affordable to low-, moderate- and middle-income tenants. In the coming weeks, the de Blasio administration will unveil its own proposals for 421-a, rent regulations and other housing programs that require legislative action. Although the administration has signaled that it will not approve anything that does not generate more affordable housing, it is trying to walk a fine line between the housing advocates, who largely support his administration, and the powerful real estate industry, which could stop building if it feels the demands are too onerous. Deputy Mayor Alicia Glen has met with developers, bankers and low-income housing advocates, but it has encouraged all parties to avoid negotiating the terms of the deal in the press, until she unveils the administration’s entire housing plan. At the hearing last week, Vicki Been, the city’s housing commissioner, did little to illuminate the city’s strategy on 421-a: “Our approach to possible reforms has been to examine the various aspects of the policy that could be tweaked or changed to better achieve our goal.” According to city records, about 150,000 apartments got the 421-a tax exemptions in the fiscal year 2013, at a cost of $1.06 billion in forgiven taxes. The tax abatement, which starts with a steep, 95 percent discount on property taxes, slowly decreases over time until the tax hits full rate. But only 12,748 of the 150,000 apartments were earmarked for low- and moderate-income tenants, making it a costly way of creating more affordable housing, according to the Association for Neighborhood and Housing Development, an advocacy group. “This program should be ended because it’s a relic that gives away billions in tax dollars and gets almost nothing in return,” said Benjamin Dulchin, executive director of the advocacy group. “But if it can’t be ended, then it must be fixed with a bottom-line level of public benefit that delivers enough housing that is truly affordable and located in the local community.” Originally intended to stimulate construction, the 421-a program was enacted in 1971, when the city was in a severe economic and fiscal slump. But as the city recovered and construction boomed in the 1980s, the program was modified several times. In its current form, it requires developers with projects in Manhattan, between 14th and 96th Streets, and in other high-demand neighborhoods around the city to set aside 20 percent of their apartments for low- and moderate-income tenants.





But in neighborhoods with lower demand, projects could qualify for the tax break without having to subsidize units. Critics today, including members of the de Blasio administration and some developers, say that the current program often stimulates luxury housing more than affordable units. Also, critics say, developers often “double-dipped,” seeking and receiving 421-a benefits, tax-free financing and other housing benefits without producing additional affordable apartments. Antonio Reynoso, a city councilman from Williamsburg, Brooklyn, said the 421-a program generated some affordable housing, but also spurred gentrification and displacement in his Brooklyn neighborhood, once a working-class area. The number of Latinos has fallen sharply in the past decade, he said. “Affordable housing is not being built fast enough to offset the losses,” Mr. Reynoso said. “There’s no need for an incentive in Williamsburg. Why give it away?” But peak land prices have soared to nearly $500 per square foot in New York, and real estate taxes on multifamily buildings now account for more than 30 percent of the buildings’ gross revenues, said Mr. Spinola of the real estate board. “We expect 421-a will be modified and put forward as part of the mayor’s overall housing plan,” Mr. Spinola said. “But you can’t build rental housing in New York without some version of 421-a.” Some developers say they are willing to include more affordable units within their projects, but they want to know: What will we get in return? The de Blasio administration wants to simplify and revise the 421-a program so that only projects that set aside affordable units will qualify for a tax exemption, according to executives who have spoken to city officials. The life of the tax exemption may be extended to 30 years, as a compromise with developers, the executives said. The administration would do away with the complicated formulas and require 20 percent of a project’s units be affordable in neighborhoods outside Manhattan, and as much as 30 percent in Manhattan and on the Queens and Brooklyn waterfront. Mr. Dulchin and the Association for Neighborhood and Housing Development offered their own set of fixes: Developers must make 20 percent of a project’s apartments affordable for families making less than $35,000 a year. In some neighborhoods, a developer would be required to subsidize more units, possibly at higher income levels. The affordable apartments should remain so forever, not the 10 or 20 years currently required. And no developer should be permitted to get multiple housing subsidies for the same affordable units, Mr. Dulchin said. _______________________________________________________________________________________________________

NEW YORK - THE QUEST FOR A LIMIT ON PROPERTY TAXES For years, many co-ops and condos and the organizations representing them have rallied around a common cry: "Taxes are unfair!" And they've had a point: for years, single-family homeowners have been the chosen ones, at least as far as the politicians go. While the assessed valuation — a key part of the financial equation that determines how much a building pays in property taxes — on co-op and condo taxes increased, those on single-family homes had a cap on how high they could go. That changed slightly over the years, when co-ops and condos with 11 units or less got their own cap: no more than 8 percent per year and no more than 30 percent over five years. It was still higher than the assessment for single-





family homeowners; that cap is no more than 6 percent per year and no more than 25 percent over five years. But it was a start. The quest for a limit on how high the city can hike property taxes for all condos and co-ops was first proposed four years ago, but now it's coming back. Some of the people leading the charge to expand the cap are cautiously optimistic that all co-ops and condos are getting closer to seeing similar relief. "The current administration is very focused on affordable housing," says Bob Friedrich, co-president of the Presidents Co-op & Condo Council, a consortium that represents 65 co-op and condo buildings. "There is no greater example of affordable housing than [what you find] among the co-ops in Queens and Brooklyn, but right now the policies of the city are hurting these communities." The DOF Speaks? Also now, for the first time, lawmakers and advocates are getting a feel for how the city coffers could be affected if the cap were extended. Because of his support on the issue, City Councilman Paul Vallone recently asked the city's Department of Finance (DOF) for projected information on the impact. According to the councilman's office, the department indicated to his office that revenues would rise in the first year after a cap, but they would fall $44 million by the fifth year. (A spokesperson for the city's DOF declined to comment on the information provided by Vallone's office, and has not taken a position on the proposal to extend property tax caps to all co-ops and condos.) Vallone says his office is awaiting a final analysis from the DOF and will consider this data and all the issues. He pointed to DOF tentative assessment roll projections for 2016, released in mid-January, that estimate a 6.6 percent hike in the total amount of assessed property value for all co-ops citywide and a 14.2 percent increase in assessed value for all condos. That boils down to an average tax hike of $448 for co-op dwellers, and an increase of $838 for condo owners. Single-family homeowners squeaked by with just a $228 hike. To enact the cap, the change must be made at the state legislature, but lawmakers in Albany will only act with the city's blessing. Bills with the cap were introduced but died in last year's session. Sponsoring lawmakers say they will reintroduce them again. Bizarre Inequities Friedrich, who besides being co-president of a lobbying group is also the president at the 2,904-unit Glen Oaks cooperative, says the assessed valuation at his co-op increased 50 percent in 2012, from the previous year. He says the city originally asked for an 86 percent increase, but lowered it after "heavy lobbying" by the co-op community. Co-ops, condos, and rental properties make up only about 24 percent of the city's property value, yet they pay 36.5 percent of the city's $21 billion in annual real estate taxes, according to the Citizens Budget Commission (CBC), a watchdog group. But the CBC is not on board with extending the cap, or even supporting existing caps, according to City Studies Director Maria Doulis. "Assessment caps lead to bizarre inequities: properties with the same value can have substantially different tax bills because the value of the properties appreciated at different rates," she says. "State leaders should be looking to eliminate the caps gradually, not extend them to additional properties." One of the thorns in the proposal is the idea that a blanket co-op/condo tax cap would benefit middle-class buildings as well as multimillion-dollar properties. Friedrich says one solution would be to create a threshold value in which very pricey co-ops and condos would not be eligible for the cap.





Braunstein acknowledges that it's a difficult problem. "It's politically difficult to change the property tax system overnight," he says. "I represent both co-ops and single-family homes and if the solution to fix this problem is to shift the burden to single-family homes, that's a very difficult political problem, too. I think that's why the system has been as it is for so long." Friedrich points out that installing a cap helps with the city's efforts toward affordable housing for renters as well as shareholders and unit-owners. When co-op and condo owners rent out their units, they have to jack up the rent to pay for higher taxes, squeezing those renters, too. "We understand that there have to be some increases, but 8 percent right now is triple that of inflation," Friedrich says. "Isn't that enough for the city's insatiable appetite for revenue?"

___________________________________________________________________________________ WASHINGTON - D.C. STILL STUDYING WAYS TO IMPROVE COMMERCIAL PROPERTY ASSESSMENTS Commercial property owners caught by surprise last year with a major change to how the District assesses office buildings and apartments saw little relief with the assessment notices they received earlier this month, but more relief could still be in the cards. The 2016 assessment notices that hit the mail by March 1 were still based on financial information that is more than a year old and likely does not reflect the true value for office buildings that may have been fully leased but are empty now. That's because the District does not require property owners to submit income and expense data for their buildings until April 15, meaning assessors are working off 2013 income and expense information. The District is still working on ways to improve the system, chiefly its accuracy and predictability, but did not have enough time following last year's appraisals and the sticker shock many felt as a result to implement more changes this year. Among the potential changes, D.C. Chief Financial Officer Jeffrey DeWitt told me in a phone interview Monday, is a timing adjustment that would let property owners submit financial data for buildings before the assessors have to put notices in the mail. That change, however, would require approval from the D.C. City Council — and may not be universally embraced by all property owners. "I don't want property owners to have to come in and appeal just because we don't have the most current information," D.C. Chief Financial Officer Jeffrey DeWitt told me in a phone interview Monday. "I've heard from both sides, and I think there's an increasing understanding that it's going to be beneficial for everybody." The District changed its assessment methodology last year to one based on pools, such as Class A office buildings, rather than individual building data such as vacancy and rental rates. As he noted when I sat down with him last November, DeWitt said the new method would more readily reflect changes in the market since it factors in what property owners are willing to pay for those buildings as a class and that, as the market improves or deteriorates, the assessments will mirror that. At the same time, commercial assessment appeals increased noticeably for the 2015 tax year. About 31.7 percent of commercial property owners filed appeals for 2015, or more than 6,700 individual appeals, up from 20.7 percent a year earlier. With the new pools, if Class A assessments were based on a vacancy rate of 10 percent, and an owner's building is closer to 50 percent vacant, the District's assessors will take that into account on appeal. About 16.4 percent of the assessments that were appealed were reduced by in-house assessors before having to go to the next level, the Real Property Tax Appeals Commission. Since last year's assessments went out, the District has automated its assessment models with new appraisal software, revised and simplified the income and expense forms property owners submit and implemented a standardized template





for filing commercial assessment appeals. It also modified the appraisal model it uses for apartments to better reflect those properties that are subsidized or rent controlled as opposed to those with market rental rates. The District is also working on a system that will let property owners appeal their assessments online and potentially to push legislation letting property owners file their income and expense forms before the District comes out with its assessments. The challenge with that, however, is that by law the District must send out its assessment notices by March 1. Making property owners submit their income and expense data before those assessments come out would only give them January and February to complete the work instead of until April 15 now. However, not everyone is likely to agree, because having more current information will likely result in higher assessments — and taxes — for some but not others. The owner of a building that has lost its anchor tenant and the rental income that comes with it might want to make sure the District knows about it and reflects that in the new assessment. And yet, the owner of a building that was vacant last year might not be as quick to what the District to know the building has been leased up now at top-of-the-market rental rates if it means higher taxes as a result. Closely related, DeWitt confirmed that this year's numbers reflected the banner year for the District's trophy building stock, which is something that I reported on earlier this month based on an interview with Altus Group U.S. Inc.'s Jeremy Chitlik. As a group, the assessed value of those top-end office buildings increases by 10.7 percent with the 2016 fiscal year, with a sum value of nearly $13.8 billion. The assessed value of Class A office buildings increased by a more modest 5.9 percent, with B and C buildings coming in at 6.6 percent and 4.4 percent, respectively.

____________________________________________________________________________________ WISCONSIN - TOWN OF CARLTON, DOMINION WRESTLE WITH NUKE PLANT VALUE What is the value of a decommissioned nuclear power plant? That is the question that the Carlton Town Board and representatives from Dominion are again wrestling with this year. Since the Kewaunee Power Station’s nuclear plant shut down after 39 years of service on May 7, 2013, its owner Dominion Resources Inc. and the surrounding communities have dealt with the impact. It will take 60 years before the decommissioning process is complete and some of the 900-acre site could be available for redevelopment, said Richard P. Repshas, licensing engineer with Dominion. “That is prime lakefront property – if it had been developed as home sites, our township would be in a totally different position right now,” said David Hardtke, Carlton town chairman. “Instead we are dealing with nuclear waste.” At the board’s March 6 board meeting, Repshas reviewed plans for fabricating the above-ground vertical concrete casks (VCCs) where the spent fuel rods will be stored. He told the board that trucks would begin delivering the cyclinder-shaped steel liners needed to fabricate the casks in May. This would be followed by trucks delivering concrete for a construction pad to fabricate the VCCs. The fuel rods will be moved into the VCCs in 2016, where they will be stored indefinitely, he said. They will be stored on the north end of the property, approximately 450 feet from Lake Michigan . He said that an outside contractor, NAC International Inc., had been hired by Dominion to oversee this part of the decommissioning process. Dismantling of the buildings won’t start until 2069 to allow the last of the radioactive material to decay over a long period, he said. The Town Board will have an opportunity to tour the site in May or June, he said. “The Town of Carlton’s decommissioning of plant agreement is still with our attorney,” Hardtke said. The board met in closed session before the meeting to discuss the proposed agreement.





The Town Board has not signed off on the agreement because it is disputing the value given to the decommissioned plant, which Dominion and the Kewaunee County Board have agreed is $10 million, Hardtke said. “The county stuck their noses in it and came to an agreement with Dominion on the value of the plant without an appraisal,” Hardtke said. Dominion says they have tried to cushion the blow of lost tax revenues to the municipalities by agreeing to ensure that the town and county’s revenue stream remains in place for the next ten years. The town of Carlton received $356,631 in shared revenue from the state in 2013. In an effort to provide the town and county with a soft landing, the number will remain at $356,631 for the town until 2018 and the county will receive $713,262. After that, annual payments from Dominion will decline by 10 percent a year for five additional years. Hardtke said the Town Board had paid approximately $65,000 for an appraisal, of which Dominion had covered $50,000. He said that the appraisal came in at about $500 million. Robert Varley, senior policy advisor, state and local affairs-Midwest for Dominion, said that the differences between the town’s and Dominion’s valuation of the property is primarily over the value of the one parcel where the generating plant is located. “In the town’s appraisal, they were using the guidance of a nuclear expert who said that the plant could be reused,” Varley said. Varley said that the plant will never generate electricity again. “The plant is not for sale because we are proceeding with the decommissioning,” he said. “We have given up our operating license and any buyer would have to go through the whole process of getting it relicensed by the NRC.” Varley said he hopes that the town board will proceed with getting another appraisal. “It may be that if they get another appraisal done it will be a better number ... a number that we can work with,” Varley said. But Hardtke said the town believes there is a buyer for the plant who would be willing to pay the appraised value. “I have a very strong board that is willing to take these issues on,” said Hardtke. He said that he was “hopeful” that the board could reach an agreement with Dominion this year.

___________________________________________________________________________________ USA - THE 10 WORST STATES FOR PROPERTY TAXES U.S. property taxes can vary dramatically by county as well as by state. Since property valuation is complex and highly changeable with the market, value is not necessarily equal to cost or price. Depending on state law, property assessments are done anywhere from once per year to every five years. Then the value assessment of a home is multiplied by the local tax rate, or millage rate, to find the property tax amount owed by the homeowner. In states or counties where property taxes are generally higher, the burden can be great enough to persuade homeowners to consider selling so they can pick up and move elsewhere.





The Tax Foundation compiled Census data from 2004 to 2009 on property taxes on owner-occupied housing, ranked by state. States were ranked three ways: median property taxes paid on homes, taxes as percentage of median home value, and taxes as percentage of income. For simplicity's sake, this list will focus on percentage of home value. This methodology allows for a comparison that shows, all things being equal, which states would generally have the highest property taxes for a home. Previously, we covered the states with the highest overall state and local taxes, but when we look only at property taxes, you might be surprised at how much the list changes. For homeowners, how their home state ranks in property tax rates could provide a welcome savings or a significant detriment. Here are the 10 states with the highest property taxes based on data compiled by the Tax Foundation. 10. North Dakota • Taxes as percentage of home value: 1.42% • Median home value: $116,800 • Rank based on percentage of income: 27 North Dakota ranks tenth highest in terms of percentage of home value, but based on the percentage of income levels, North Dakotans don't appear to have particularly high property taxes. North Dakota also boasts the lowest unemployment rate in the country. Often it is the counties with the highest property taxes that tip the scale for the whole state. According to data from 2005 to 2009, based on percentage of home value, the worst counties in North Dakota for property taxes are Cass, home of Fargo, and Grand Forks. 9. Vermont • Taxes as percentage of home value: 1.59% • Median home value: $216, 300 • Rank based on percentage of income: 3 Like many states in New England, Vermont fares poorly in terms of state and local taxes overall, and the state's property taxes certainly aren't helping. Vermont ranks in the top 10 for all three of the Tax Foundation's measurements: percentage of home value, median taxes paid, and percentage of income. Windham, Rutland, and Washington counties ranked highest for Vermont. 8. Michigan • Taxes as percentage of home value: 1.62% • Median home value: $132,200 • Rank based on percentage of income: 10 Its median home value of $132,200 isn't extremely high, but Michigan still ranks eighth in terms of property taxes as percentage of home value. While a number of Midwest states rank fairly high as well, neighboring Indiana comes in at only





No. 27 with 0.85%. Detroit's Wayne county is Michigan's highest ranking county for property taxes, followed by Ingham county. 7. Connecticut • Taxes as percentage of home value: 1.63% • Median home value: $291,200 • Rank based on percentage of income: 4 Connecticut's median property taxes paid on homes is the second highest of all the states at $4,738. A recent report from the Department of Revenue Services shows Connecticut taxpayers pay more in local property taxes than any other taxes, including income taxes. Massachusetts, a border state, ranks at a more reasonable No. 21 in terms of percentage of home value. Hartford, New Haven, and Tolland are Connecticut's highest ranking counties. 6. Illinois • Taxes as percentage of home value: 1.73% • Median home value: $202,200 • Rank based on percentage of income: 5 Illinois ranks in the top 10 for all of the Tax Foundation's measurements, and according to a recent report from the Urban Institute, Illinois actually has the second highest property taxes as of the end of 2012. Winnebago county, home of the city of Rockford, ranks No. 25 overall for counties with the highest property taxes in the U.S. Stephenson, Livingston, and several other Illinois counties follow close behind. 5. Nebraska • Taxes as percentage of home value: 1.70% • Median home value: $123,300 • Rank based on percentage of income: 14 Despite a comparatively low median home value of $123,300, Nebraska has the fifth highest property taxes in the U.S. Nebraska's figure for median property taxes paid on homes is a relatively modest $2,164, bringing the state in at only No. 17 for this measurement. Recently, Nebraska farmers have called on the state legislature to lower property taxes because they hold so much of the burden. Clay County and Grant County have the highest property taxes in the state. 4. Wisconsin • Taxes as percentage of home value: 1.76% • Median home value: $170,800 • Rank based on percentage of income: 8





Wisconsin boasts the highest property taxes in the Midwest. However, neighboring states Minnesota and Iowa could potentially offer some mild relief to taxpayers looking to relocate. Their ranks are No. 19 and No. 15 respectively. The worst county in Wisconsin for property taxes is Milwaukee County, which is also No. 32 overall in the U.S. 3. Texas • Taxes as percentage of home value: 1.81% • Median home value: $125,800 • Rank based on percentage of income: 12 With a relatively low median home value of $125,800, Texas actually isn't in the top 10 according to the Tax Foundation's other ranking methods, but its taxes as percentage of home value easily bring it up to third. Fort Bend County is the 16th most expensive county overall in the U.S., while spots one through 15 are dominated by New York state. Tarrant and Williamson are also in the top 30 counties overall. 2. New Hampshire • Taxes as percentage of home value: 1.86% • Median home value: $249,700 • Rank based on percentage of income: 2 New Hampshire has the second highest property taxes in the nation. However, as the state of New Hampshire does not have income tax or sales tax, it relies heavily on property taxes. Neighboring Maine ranks only 18th in taxes as percentage of home value, a modest rank particularly for New England. Cheshire, Coos, and Sullivan are the highest ranking counties in New Hampshire. 1. New Jersey • Taxes as percentage of home value: 1.89% • Median home value: $348,300 • Rank based on percentage of income: 1 Ranking first in all three of the Tax Foundation's categories, New Jersey's figure for median property taxes paid is a whopping $6,579. According to the New Jersey Department of Community Affairs, Tavistock Borough has the highest average property taxes in the state at $25,346. Camden County, just across the river from Philadelphia, is No. 18 overall in the U.S., and Gloucester and Salem rank high in property taxes as well, at No. 43 and No. 44. _______________________________________________________________________________________________________

NEW JERSEY - PROPERTY TAX APPEALS DOWN IN CENTRAL JERSEY With school districts and municipalities finalizing their budgets and income tax season here, it's the time of year when people start complaining about their property taxes.





But, whether it's because of an improving economy or a 2 percent cap on tax increases, the number of property tax appeals is declining across Central Jersey. Property owners have an April 1 deadline to file appeals of their assessments, which they should have received at the beginning of the year. For an appeal to be successful, a property owner must show in a formal hearing before a county tax board that the assessment is not in line with the "true value" as determined by the property's market value, a function of recent sale prices of similar properties in the municipality. A property owner also can show that an assessment should be lower because of physical deterioration. In Somerset County, the number of property tax appeals continues to decline. The number of 2015 appeals is down about 50 percent from 2014, said Somerset County Tax Administrator Robert Vance. And the 2014 number was down 46 percent from 2013, he said. Part of the reason for the decline, he said, may be the improving economy. In 2012, Somerset County had 1,459 tax appeals. There was a small uptick in 2013 to 1,527 appeals. But in 2014, the number dropped to 915. Almost one-quarter of those appeals in those three years came from Manville, where many properties are in flood-prone areas. But the primary reason for the drop in appeals is that most Somerset County towns update property assessments every year, Vance said. Municipalities used to perform property revaluations at intervals of several years, Vance said. That resulted in homeowners suffering "sticker shock" when they received their assessments, a common occurrence as property values shot up in the real estate boom in the 1990s and early 2000s. But now most Somerset County municipalities update assessments every year to maintain a better ratio between the property's market value and its assessment. Only one Somerset County municipality, Montgomey, had an assessment to "true value" ratio of less than 90 percent (83 percent) in 2014. A similar downtrend appeal trend is occurring throughout the region. • In Middlesex County, there were in 2014 several municipalities with assessment ratios of less than 50 percent, with three municipalities — East Brunswick, Dunellen and Woodbridge — with ratios less than 30 percent. Despite that, the number of tax appeals filed over the past three years in the county has been on the decline. In 2014, there were 3,172 appeals filed, more than 50 percent lower than the 6,583 appeals filed in 2012, according to the Middlesex County Tax Board. In 2012, Perth Amboy had the most appeals with 1,225, followed by 986 in Monroe, 896 in East Brunswick and 691 in Edison. In 2013, appeals in Monroe totaled 1,493, followed by 740 in Perth Amboy, 714 in Edison and 683 in East Brunswick. In 2014, Monroe still had the most filings, 471, followed by Perth Amboy with 423, Edison with 400 and East Brunswick with 377. Figures for 2015 tax appeal filings are not yet available, officials said.





"Tax appeal refunds totaled $15.5 million from 2010 to 2013," Monroe Township Business Administrator Wayne Hamilton said. "In 2012, we began the townshipwide revaluation process, which was completed and certified last year. Now that our assessed value to market value ratio is 96.9 percent, there are a limited number of residential tax appeals." • In Hunterdon County, where the lowest municipal assessment to true value ratio is 84 percent, the number of appeals has also experienced a downward trend, from 653 in 2012 to 567 in 2014. • Union County has also experienced a dramatic fall in the number of appeals. In 2012, 5,588 appeals were filed; that number dropped to 4,470 in 2014. According to the Union County Tax Board, that number may fall even more this year, with only 502 appeals filed by mid-March.

ipti xtracts · the change has drawn support of big real-estate groups. ... while old-timers...

Documents