Letters to the Editor
2010 Lancaster Assessment Equity Project
By Dave Marrano
Jun 5, 2009, 10:50

Attached you will find two very informative sheets that discuss the project we will be undertaking in Lancaster for 2010. The document titled” Reassessment Facts” speaks to facts on reassessments, and the benefits of keeping values up to date. The second document Titled “Tax rate Effects” shows that there is not necessarily a correlation between values and Tax rates.

The job of the Assessor is to make sure the value he puts on your home is correct. Real estate values are constantly changing. When a municipality keeps their values up to date, they insure that all taxpayers are paying their fair share of taxes. The Assessor DOES NOT set tax rates. Those are set by the levies set by County, Town, School or Village boards. The assessor’s responsibility is to make sure property owners are paying their fair share. It is very important to remember that when values are updated, there will be decreases and increases to value.

In the fall, the assessor’s office will be scheduling information sessions that will help explain the process. The dates and times will be announced soon. Starting in July you may see people from the Town Assessor’s office or our Contractor EHNP in your neighborhood-reviewing inventory. They will have identification on them. Please feel free if you see them to stop and ask any questions.

As always, our goal is to provide as much information as possible. Feel free to call the Assessor’s office at 716-683-1311, or email the assessor at dmarrano@lancasterny.com

Reassessment Facts

The Benefits of Maintaining Assessment Equity at Full Market Value / The Pitfalls of Not Maintaining Assessment Equity

Facts:
• A “reassessment” is the comprehensive review and updating of all property values in a community – bringing them up (or down) to market value. In doing so, the assessor does not raise or lower the property tax for a community, but rather “levels the playing field” so that all properties are fairly assessed and pay only their fair share of taxes.

• The professional standard for assessing – and the standard in most states in the country, is to regularly update assessments and bring them back to market value.

• While not required by statute, most communities in New York reassess regularly. It is in fact the norm in New York State. Of 983 Towns and Cities, more than 600 have reassessed in since 2005 or are doing so now.

• But, because state law does not require periodic reassessment, each community must decide whether and how frequently to update property values. Until that local decision is made, properties in these non-reassessment communities continue to be assessed using very old property values. The lack of reassessment does not keep taxes from going up. However, the lack of reassessment does over-tax some property owners, who end up subsidizing others who are paying too little. This is anything but transparent and very difficult for taxpayers to understand.

• It is important to understand that assessors do not increase taxes. Remember: elected officials raise taxes when they increase the overall tax levy to pay for higher budgets, whereas assessments are simply the means of distributing those taxes.

• Property taxes in New York State are 78% greater than the national average. No tax payer should pay any more than their fair share of our too-high taxes. The only way to do that is professional, regularly updated assessments. Every taxpayer deserves no less.

Benefits of Maintaining Assessment Equity at Market Value:

• Assessment Equity for Taxpayers - Maintaining current assessments at market value eliminates unfair assessments and the “sticker stock” that taxpayers experience when assessments are adjusted after many years of neglect.

• Corrects Inequities - Taxes do not go up as a result of a reassessment itself – those who were unfairly paying too much will pay less, and those who were unfairly paying too little will pay more. Reassessment merely corrects the inequities, with no net tax increase. Reassessment is a zero sum game.

• Overall Taxes do not Increase - Merely raising an assessed value up to market value, by itself, does not raise an individual owner’s taxes. Your taxes increase only if you were previously under assessed (and, therefore, paying too little in taxes). For each property owner that sees an increase in taxes, someone else will see their taxes come down.

• Reassessment does not help or hurt a particular group (e.g., older residents or poorer neighborhoods) – it all depends on whether the individual’s property was undervalued or overvalued beforehand. In fact, typically reassessment will help homes and neighborhoods that have not appreciated as fast as the rest of the community.

• Local Control of the Equalization Rate – By maintaining assessments at market value each, municipalities can consistently receive an equalization rate of 100. This eliminates shifts in the school and county tax apportionment due to fluctuating equalization rates.

• Improved Bond Ratings – In addition to State Aid, many municipalities are receiving improved bond ratings as a result of their efforts to keep assessments current. These municipalities are saving tens of thousands of dollars each year (and, in some cases, much more than that).

• Fewer Court Challenges to Assessments – By keeping assessments in line with current market values, municipalities are likely to have fewer tax certiorari cases.


• Increased State Land Assessments – Because State land assessments are frozen at the year of the last municipal-wide reassessment, annual assessments allow municipalities to make changes in the market value that they could not otherwise capture.
Pitfalls of Not Maintaining Assessment Equity:

• Lack of Transparency - The lack of reassessment does not keep taxes from going up. However, the lack of reassessment does over-tax some property owners, who end up subsidizing others who are paying too little. This is anything but transparent and very difficult for taxpayers to understand.

• Outdated Assessed Values - Here is how to look at the problem if you are in a community that has not updated their assessments. Twenty years ago, yours and a neighbor‘s similar home sell for the same price. Being similar homes, selling at the same price results in both properties assessed at the same sale price. As a result, you both paid the same taxes then. Now roll forward twenty years: property conditions and neighborhoods always change, which means the same two properties are not worth the same today. Maybe your neighbor’s home sells for twice what yours is worth today – but absent reassessment, you would both still pay the same tax!

That means your slower appreciating property is taxed too high, and the neighbor’s faster appreciating property is taxed too low. Due to the lack of periodic reassessment, you are subsidizing your neighbor’s taxes, which is grossly unfair. And to make matters worse, there is almost no way a typical taxpayer can see the unfairness. For instance, your assessment could represent only 50 percent of your property’s market value, but you could still be over-assessed compared to other property owners. It is incredibly confusing.

• Lack of Taxpayer Understanding - Various misconceptions about reassessment all come down to a lack of understanding about a very technical subject. Unfair and outdated assessments confuse taxpayers regarding market values and equalization rates. In a non reassessment community, taxpayers with appreciating properties pay less than their fair share of taxes, and their benefit is paid for by taxpayers whose property values have not appreciated. Is this the message that local government wants to send to the taxpaying public?

• Fluctuating Equalization Rate – In non reassessment municipalities, rates will change each year as the overall market value changes, causing a shift in county and school apportionments. Taxpayers also do not understand why their “full market value” as stated on their tax bills has changed, when their assessments have remained the same.


• Exemptions – Fixed dollar exemption amounts that are dependent on the equalization rate (such as the Alternative Veterans Exemption) will drop as the rate drop. This increases the overall taxable portion of their assessment, resulting in higher taxes.

Assessments vs. Taxes: What’s the difference?

Your assessment could increase and your tax bill could decrease

Last year
Your Assessment > $100,000
Total Value of Town > $50,000,000
Tax Levy > $1,500,000
Tax Rate > $30 per $1,000
Your Property Bill > $3,000

This Year

Your Assessment > $105,000
Total Value of Town > $54,000,000
Tax Levy > $1,500,000
Tax Rate > $27.78 per $1,000
Your Property Bill > $2,917

Your assessment could increase and your tax bill could stay the same

Last year
Your Assessment > $100,000
Total Value of Town > $50,000,000
Tax Levy > $1,500,000
Tax Rate > $30 per $1,000
Your Property Bill > $3,000 (decrease of $83)

This Year

Your Assessment > $105,000
Total Value of Town > $54,000,000
Tax Levy > $1,542,000
Tax Rate > $28.57 per $1,000
Your Property Bill > $3,000 (no change)

Your assessment could decrease and your tax bill could increase

Last year
Your Assessment > $100,000
Total Value of Town > $50,000,000
Tax Levy > $1,500,000
Tax Rate > $30 per $1,000
Your Property Bill > $3,000 (decrease of $83)

This Year

Your Assessment > $95,000
Total Value of Town > $47,500,000
Tax Levy > $1,542,000
Tax Rate > $32.48 per $1,000
Your Property Bill > $3,085 (increase of $85.60)


• For more information on the factors affecting your tax bill, talk to your school board, town board, and city council, or county officials.

• For more information on assessments, talk to your assessor.

• More information is available online at: www.orps.state.ny.us


Dave Marrano
Town of Lancaster Assessor




© Copyright 2003 by Speakupwny.com