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EDITORIAL: Scratching Our Heads Over Assessor Valuations, Part Two |
Bill Hudson | 6/9/09
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Read Part One
The letter that arrived in my mailbox last week from the Office of the Assessor, printed in green and black ink, states very clearly at the top: “This is Not a Tax Bill.”
Indeed, the Office of the Assessor has a very clear purpose — to assess the value of each of the thousands of properties owned by companies and private individuals in Archuleta County. These valuations are then used by the Archuleta School District, the Pagosa Area Water and Sanitation District, the Pagosa Fire Protection District, the Archuleta County government, and numerous smaller districts. Each district collects tax revenues based on its own mill levy — which was approved by the voters at some point in the past.
 In recent years, the School District has collected about 40 percent of the total property tax revenues in Archuleta County, with the County government collecting about 30 percent, Pagosa Area Water and Sanitation about 12 percent, and the Fire District about 7 percent, with the remainder going to various other districts.
In other words, the Assessor’s Office does not collect any taxes, nor does it set any mill levies. County Assessor Keren Prior and her team merely establish the valuations. From there, it’s up to the voters and our County leaders to decide how much taxes should be collected based on those valuations.
So the letter that arrived last week was quite right in stating “This is Not a Tax Bill.”
But the dilemma facing property owners this year — and the reason why the Assessor’s Office will likely see a sizable number of protests — has to do with a significant increase in valuations based on sales in 2007 and 2008 — and the perception of many property owners that their property must be actually worth less this year than it was during the last two-year valuation announcements in 2007.
Which gets us to the real question: How do you determine the value of a property? In my own case, what is the real value of my house in downtown Pagosa Springs? Is it really worth $271,450 like the Assessor’s Office claims?
In fact, there is only one reasonably exact way to determine the value of a vacant lot, residential home, or commercial property. You put it on the market and sell it to the highest bidder. In the case of my own home, a 100-year-old Victorian-style two story house that Clarissa and I bought in 1994, the last time it was sold was .. well .. in 1994. At that time, we paid $129,000 — which was about twice what the previous owner had paid for it a few years earlier, back when it still needed extensive renovation.
We have not made the house any larger since 1994, but we did convert the detached garage into a studio space, and we converted a ‘sewing room’ into a sauna. Otherwise, the house hasn’t changed a whole lot in the 15 years we’ve owned it.
In 2007, the Assessor’s Office established the value of my house at $191,724 — and as a result of that new valuation, my property taxes went up about 25 percent. My 2009 increase amounts to about 40 percent — so with all things being equal, that might very well mean a 40 percent increase in my property tax bill next January.
The green and black letter from the Assessor’s Office states very clearly: “You have the right to protest the classification and/or valuation of your property. Please refer to the reverse side of this notice for additional information.” On the reverse side, the protest procedures are briefly spelled out:
“If you wish to protest in writing, please include your estimate of property value as of June 30, 2008, and any documentation that you believe supports a change in the classification and/or valuation of your property…”
As Keren Prior had explained for Glenn Walsh and I during last week’s interview, your protest must focus on proving a more accurate value, based on something the Assessor’s Office may have overlooked about your property or neighborhood.
“You have to tell us what you think your property was worth on June 30, 2008, and the reasons that support your estimate,” Prior explained. “I don’t want to hear what you think it’s worth now, in 2009; that doesn’t do us any good. The fact that you can’t afford higher taxes is not a good reason. It doesn’t matter that you didn’t make any improvements over the past two years. You have to have a legitimate reason why you are protesting that value. If some characteristics are wrong about the land or house, then you need to point those out.”
Prior made it very clear that a property owner can not protest the methods used by the Assessor’s Office to obtain the county-wide property values. Those methods are established by the state of Colorado, and are not subject to protest. So protestors need to focus on the characteristics of their own little piece of heaven — and they need to bring clear evidence to the table.
There can be no doubt that the Assessor’s Office occasionally misses the mark on certain individual property valuations. They are, for example, using mass appraisal methods that value all vacant land in a given neighborhood at the same median price — regardless of property characteristics such as mountain views, proximity to rivers and lakes, and other factors that might make one piece of land inherently more or less valuable than another.
So I was curious. Was my own house valued accurately? Could I discover any reasons why, perhaps, the estimation process had missed the mark on my own little property? There was only one way to find out.
I showed up at the front counter of the Assessor’s Office yesterday, near the end of a presumably busy day there. Four other property owners were already at the counter, asking questions, making verbal claims, and generally trying to understand how their property value could possibly have increased so dramatically over the past year. I was somewhat surprsied to see that everyone — on both sides of the counter — was keeping their voices and emotions reasonably under control.
A younger gentleman stepped up to the counter to offer me his help — I’m sorry to say, I didn’t catch his name — and I told him I wanted to know more about how my house had been valued. For example, I said, this letter says I have a three bedroom house. How do you define a bedroom? He explained that a bedroom has to include a built-in closet.
In that case, I told him, my house has only two bedrooms. How many other facts about my house did the Assessor have wrong? And how much were those mistakes going to cost me next January?
Read Part Three... |
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