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Taxes and Fees
The New York State Office of Real Property Services (ORPS) and municipal assessors across the state are telling us of the importance and benefits of municipalities basing property and school taxes on 100 percent property market value.
When making presentations on why the Town of Lancaster should consider Lancaster do a reval Assessor Dave Marrano stressed that the number one reason for doing an assessment equity project is for fairness; paying taxes on market value. “Some people are not paying their fair share of taxes.”
Marrano debunked the belief that the number one reason for doing a reval is to raise tax dollars. “When we do assessment equity, it has nothing to do with increasing tax dollars. The point is to make sure the tax dollars are being distributed equitably.”
Marrano went on to say that despite the number of house sales dropping, the values are still increasing in our area. “The longer we wait to update our property values some people are paying more than their fair share while others are paying less than their fair share.
“There is no incentive here to raise taxes,” declared Marrano. Taxes do not necessarily increase, or decrease with a reval. “The board makes a budget based on what it costs to operate the town. It has nothing to do with my assessed values. Tax rates are determined by a municipalities tax levy as determined by their governing board.”
“Properties do not increase or decrease in a uniform rate, yet our Equalization rate is a town-wide average. Our equalization rate is now at 93%. The equalization rate does not reflect town growth and some people are winning and some are losing. The NYS Office of Real Property Services (ORPS) wants all municipalities to be at 100% market value. That’s our goal.”
When the town is not assessing at 100% market value, two key exemptions, STAR and Veterans programs get reduced.
Fairness is in the eyes of the beholder
As someone who believes an assessment based on property full market value is the best and fairest method to tax properties, where theoretically everyone pays his or hers fair share, I well understand property owner criticism of doing a reval at this time. I share some of their following concerns and comments and assessors should note the concerns and address them at time of reval:
• At this time of economic crisis, no one wants to pay more in taxes. It’s bad enough that our tax dollars are being used to bail out failing institutions.
• Western New York may be behind the national trend where home values are declining. Erie County supposedly is bucking the trend and showing a 3% increase in home value. However, as the recession gets deeper and deeper and more local layoffs occur, prices in Lancaster will drop. In fact, they are already falling. The economy and home sales market are not stable enough to warrant a reval at this time.
• Two homes may look alike from the outside, but the one may be much more updated on the inside and would commend a bigger sales price.
• I am retired and have been living in this house for 30 years. I paid nowhere near the amount to purchase the home that you have assessed it at. Being on a fixed income, I can’t afford to pay these taxes, nor should I. This isn’t fair!
• There is no way that the market value of my house can be determined until the day of sale. Your process in nothing more than a best estimate of my home’s worth.
• I paid $40,000 for my home in 1973 and you have it assessed today at $140,000. Just because homes like mine in the neighborhood are selling for $140,000 that doesn’t mean I could get $140,000. What’s that? What’s my house worth? Probably around $140,000, that’s what they’re getting for them.
• I have a home that I recently bought for $350,000. It is a larger sized home but sits on a lot that is only slightly larger than most Lancaster Residential-1lots. I receive no more in town provided services than a homeowner assessed at $100,000. This is fair?
• I live in a subdivision where I pay a fee to a private association that provides services that are not provided by the town. I pay full town taxes as well. Several subdivisions in town are building patio homes and townhomes that receive 40% property and school tax reductions under NYS Condominium Law 339-y.
This is grossly unfair as the patio homes are priced at $225,000 and up and the tax reductions far outweigh the costs of the services not provided by the town. In fact, the rest of us taxpayers are paying for their entire association fee and then some depending on the cost of the home.
• You go through the appeal process and they sit there and look at you like you are from another planet. They ask you to provide pictures and/or documents to establish that your property has been over assessed. How dare they?
• It’s a money grab by the town and school district. They don’t expect the average property owner to be able to determine what portion of his increase came from reassessment or the tax levy they are imposing. Either way, it gives the town and school an opportunity to spend more.
• Perhaps we should seriously consider downsizing our bloated local government and adjusting our civil workforce to changing conditions. The time for prima Don and Donna deals with lavish wages, working conditions and benefits should come to an end. When this happens perhaps we can experience a true tax reduction!
• Our assessment is higher than what we can now sell our house for. (Annual reassessments mitigate market shifts.)
Opinion
Should a reval be undertaken in the near future considering today’s economic crisis, probably not? No one in Erie County is in a position to pay more in taxes.
But as the realistic intent of a reval is to have everyone pay their fair share of taxes, what has the state of the economy have to do with the annual reval process?
If assessments were lowered across the board because of a decline in market value, you can be assured that the tax rate per thousand dollars of assessed valuation will increase to provide the needed revenue to provide for town operation. The municipalities and school districts will get their pound of flesh one way or the other to continue spending freely!
Are there valid concerns that the process proposed has shortcomings and is not the panacea for everyone? Most likely! There is no perfect format.
However, the process in itself has merit for myriad reasons. Until such time another format proves otherwise, it is most fair. It is when the process is manipulated by local governments and school districts to increase taxes for irresponsible spending, under the guise that the tax rate was lowered because of the increase of municipal valuation, and that any tax increase a property owner was subjected to was caused solely by property reassessment.
Some homeowners who have appeared before the Assessment Board of Appeals state they were treated disrespectfully and received no consideration. Yet, in talking with several assessors from different towns, the appeal success rate appears to be around 50%.
Don’t shoot the messengers (assessors). As they say, “It’s the spending, stupid!”
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