| Author |
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Gerardryan
| | Posted on Wednesday, February 7, 2001 - 11:42 pm: |     |
Joan: there is that possibility
Kap: what was voted on was to pass on a suggestion to Sen Rice for some enabling legislation that we might use. It would apply a phase-in to every property.
Lseltzer: the notion is to roll in assessment changes; for example, 60% year 1, 90% year 2, 100% year 3. The percentage would be the difference between the old assessment and the new assessment. My thought is that, for example, if in year 2 there is some change to your assessment (tax appeal for example) then the percentage is applied to the difference on that new assessment... so I think the circumstance you outline wouldn't occur.
Kap + Lseltzer: if this is implemented at all (big if based on the need to get it on the books in Trenton) it will only be done after modeling and analysis and discussion so that the effect of it, and the pros and cons of it, are clear to everyone.
Mlj: I guess we differ on how we saw that discussion.
I do not know the answer to your question about which streets but will try to get it. |
Dytunck
| | Posted on Wednesday, February 7, 2001 - 11:44 pm: | |
To Mr. DeLuca and the TC:
Thank you for listening to my suggestion for a Property Card workshop. It was worthwhile to hear Mr. Gallante explain how the property values were assessed and what the formulas mean.
To Alidah:
YOU WIN THE GRAND PRIZE! You are absolutely correct.
It works like this:
CVI assigns a value to your house on (example) an eighth of an acre. Say, $400,000. Then they extract the price of your improvements using replacement per square footage formulas based on 1975 constants. Maybe, after all is counted up your structures (house, patio, porch, garage, pool, etc) add up to $196,250 (adjusted for 2000). That means the remainder of your property - the land itself- is worth $203,750.
So you take 1/8 of an acre at $350,000 per acre and get $43,750. Subtract that from your total land value and you get a Site Value of $160,000.
How are you going to argue that they made an error? They calculated the subtractions additions and multiplications right.
Here's the fallacy in logic: Suppose the STARTING NUMBER WAS WRONG?
Ed Gallante made it *very* clear to me today that if the land was too low, then they'd raise the structure cost or if the land was too high, they'd lower the structure costs to make the math work to their STARTING NUMBER. That's what all those "intangible" and poorly explained multipliers are.
In 1981, my home was given a "quality" index of 17, but Ed said at the meeting tonight that the assessors used the multipliers of a 16. Now my home is an 18. (Out of a possible 20. "But they can go higher if they want to." Watch the reruns on CH35. He says this right to all of you.) They are just using whatever makes the math work.
This is why Ed is so exasperated. He has hundreds of people nit-picking him on their porches and crawlspaces and sheds and outdated kitchens and leaky basements. He doesn't understand why the people don't get it. "If I lower your structure, I'm just going to raise the factor somewhere else, but one way or the other, your house is worth what I say it's worth."
People, stop looking for the formula to add UP your property value. It's a foregone conclusion. All the math is just to BACK the NUMBERS IN.
I'm not going to roll over and take this, however.
Dytunck |
Dytunck
| | Posted on Wednesday, February 7, 2001 - 11:50 pm: | |
Hi Jerry,
I don't know if you received the emails I sent you. I replied to your email from reval07040 with my attachments from my presentation the other night.
If that's not your email address, email me and I'll be happy to resend them. (19 minutes to download).
I'm not sure if this is the forum to discuss my encounter with Ed Gallante this afternoon. I'm going to mull it over a little longer. Maybe I'll calm down.
Dytunck |
Gerardryan
| | Posted on Wednesday, February 7, 2001 - 11:57 pm: | |
D: I got the emails but have not gone through them yet.
I did not attend or see the meeting today tho I saw your posting on your impression, and I expect to watch a rebroadcast.
Discuss away; I am sure if you don't someone else will :-\ I'm not going to participate unless and until I see the broadcast. |
Njjoseph
| | Posted on Thursday, February 8, 2001 - 9:29 am: | |
Dytunk, I understand your frustration and can see where you might have interpreted Ed Galante's statements the way you did. There is a matter of subjectivity in the appraisal, which is in the class and the depreciation.
However, if your house did not sell in 2000, there had to be a way of getting to market value. What I heard (and possibly interpreted) Ed say was that the numbers for site value and acreage were based on actual sales. Yes, they were backed into, but the amount for land was calculated to be the purchase price minus the building's cost.
They then applied the same site value and cost per acre (for the minimum in the zone) across all houses in the VCS. For acreage over the zone, it was charged across the WHOLE TOWN at $100K/acre.
I don't think your numbers will change all that significantly. I believe that Ed said something like the multiplier for class 16 was 1.25. Mine is 18, and the multiplier is 1.35. For my house, reducing to class 16 would mean a change in assessment of only $20000, for a net tax benefit of $550. These are not the staggering figures that people are complaining about. And although my class 18 is subjective, do I really think my better-than-average quality house is going to be considered an average house by any appraiser? No.
On the other hand, why don't you contact your insurer and see what the replacement value is on your structure. It might give you some insight. |
Jennie
| | Posted on Thursday, February 8, 2001 - 10:27 am: | |
Dytunk: I feel your pain. I appreciated the explanation of the cryptic numbers, but the bottom line is that reliance on 2000 sales distorted the whole thing. I have yet to hear a satisfactory explanation of the "consideration of three years" provision in the Certified contract. To see if there are trends? And what exactly is done with that "trend" information? Is it just out of curiosity--oh, there's a trend. Is it, as Certified told me, that they use 2000 sales, but if there are none, prior years are used and adjusted upward or downward as the trend would indicate. If that's the case, why doesn't the contract just say that. I think a more rational explanation is they have to look at 3 years to determine if the latest year is a true indicator of value or an aberration. In this case (where in 2000 sales prices skyrocketed and in one case increased over 100% for the same home), a real consideration of the past 3 years would warn against total reliance on the year 2000. |
Njjoseph
| | Posted on Thursday, February 8, 2001 - 11:11 am: | |
Here we go again with the aberrations. The assessment is just a number to be used for 2001. It is self-correcting. If market values go down in 2001, the 2002 assessment will be lower. And with lower assessment, the tax rate goes up.
Besides this, with the exception of the area east of Springfield, houses all over Maplewood increased dramatically in market value from 1998 to 2000. Assessments are comparisons of one house to another. If we use 1999 numbers, all houses would be affected, your assessment may be reduced by $100K, but the rate might go to 3.5% to 4%. For example, a $400K house (in 2000) * 2.75% is $11,000. A $300K (in 1999) * 3.67% is still $11,000.
Assessments for 2000 in and of themselves have no meaning.
When I was looking for houses in May, 2000, I heard more than once that what used to be a $200K house in 1998 became a $350K - $400K in 2000. |
Yvette
| | Posted on Thursday, February 8, 2001 - 11:13 am: | |
Jerry,
Please correct me if I am misinterpreting your explanation of the bill:
Those whose taxes are going up will be phased in over a period where they will pay a litle more each year until they reach their (at that time) current tax $ amount; and
Those whose taxes are going down will pay a little less each year until they reach the $ amount they should pay; and
Those in the middle will also pay a little more until the end of the phase-in, because the rate will go up to compensate the phase in.
I do understand that this will be customized to our town, but, do you think it is FAIR that those whose taxes are suppose to go down or stay the same should have to participate in such a phase-in????
Since there have been a lot of changes to the initial assessments, I would like to know the percentages of how many a)whose taxes are going up and broken down by percentages of increase b) whose taxes are going down c) whose taxes are staying the same --- because if there is not a high percentage of those whose taxes are going up more than the average yearly increase then is this phase in really necessary. |
Teach66
| | Posted on Thursday, February 8, 2001 - 11:23 am: | |
Now, I consider myself to be a somewhat intelligent person and I am completely lost on this one. Njjoseph, what on earth are you saying? That if the assessment goes up the rate goes down and if the assessment goes down the rate goes up? So if someone's proposed taxes are $16,000 they are going to stay that way no matter what? And every year some crazy person (or some going-to-be crazy person) is going to go through each and every home adusting the assessment and the rates up or down? - or that individual homeowners are going to constantly have to be on top of this from now on? I consider it unacceptable that everyone is having to even go through this initial process. It never should have gotten to this point. Again, the TC should be ashamed of itself! |
Dytunck
| | Posted on Thursday, February 8, 2001 - 11:30 am: | |
NJ,
I based my message on my meeting with the Assessor prior to the "workshop" meeting and things that he said during the meeting. So we both have a different take on the meeting.
Ed was quite clear with me. I am telling you, the Site Value was not set for neighborhoods first. The acreage costs were not established first. I tried to pin Ed down on that point and was treated very rudely, but I got the message.
Ed told me that the method was this:
1) Establish the property value.
2) Extract the cost of the structure (improvements) to determine land value. This is called the "Land Extraction Method"
3) "Play around" (!!) with the figures until they fit.
4) Any tinkering is then done to the many vague factors on the structure model, such as:
* Quality rating 16, 17, 18, 19? Which drives a multiplyer.
* Depreciation Factor. These seem to be all over the lot.
I asked him how the division of the Land Value and acreage cost divided between Site Value and Acreage was determined. Surely, if the site value is 0, the acreage cost goes up. If the site value is 200K, the acreage costs go down. He told me that they "play around" with the figures until a close fit is made for the model they are trying to prove.
If they made mistakes on square footage, etc. you may get a slight adjustment, as you point out. But the effect is negligible to your or the town's taxes. If the people who appeal their taxes based on errors of fact are happy with their $200 reduction, the town feels the controversy is over.
But don't try to appeal based on your opinion that the starting number is wrong. He told me that approach will be met with a "Thank you..." (followed by a throwing in the garbage gesture).
Here's a word problem:
If X (property value) minus Y (improvements) minus Z (acreage)is 60 (site value)
And WE TELL you that X=100
And we can prove Y is 10 (using state mandated formulas),
Then Z must be 30.
Any arguments?
Yes. If X is really 90, then Z is 20. The X figure is what drives the formula in a Land Extraction Method.
The fallacy is that X is subjective. Y and Z are just products of the back-in math. And they don't want to hear that X is wrong. Argue Y and Z all you want.
How do you prove that they got X wrong in your case?
I am going to try, but my prediction is that my appeal will be met with the very reaction Ed told me it would be. "Thank you." Followed by the sound of paper being tossed into the garbage.
Dytunck
PS for those who feel their valuation is fair, and there are plenty of folks that do, sorry for the rant. I just don't think CVI or EG got them all right, and I don't think they're approaching the appeals - or rather- the assessment review process openly, as I personally witnessed. |
Njjoseph
| | Posted on Thursday, February 8, 2001 - 11:32 am: | |
Yvette, I understood the same, and I agree it's not fair.
Teach, that's exactly what I'm saying, and it's true! When assessments go down, rates go up. If 10 houses go down, the rate goes up, and 7500 will pay for the difference. However, if 7500 houses go down to reflect 1999 market values rather than 2000 market values, the rate goes up and 7500 houses pay for the difference.
In fact, we've seen this already. The estimate for several months for the rate if the assessment had been in effect for 2000 was 2.66%. Now, with across-the-board adjustments for some blocks, the rate is now 2.75%. Keep asking for the adjustments, and encourage your neighbors to do so. The more people that do it, the higher your rate will be. But be warned, when houses on your block start selling at 20% over their assessed value, your assessment will go up by 20%. If the rest of Maplewood doesn't go up, your taxes will go up significantly. And this number will be adjusted annually or bi-annually. |
Overtaxdalready
| | Posted on Thursday, February 8, 2001 - 11:38 am: | |
Teach....the township needs to collect taxes to cover the costs of the township, schools, and county of Maplewood. Last night Vic said that totalled $56 million. He also said the current ratable base (sum of assessements) was approximately $2 billion (I may be off a little, but this is just an example). Therefore, to cover the $56 million needed, they would apply a tax rate of 2.75% against all the assessed values. So if your house was assessed at $580,000 your taxes would be approximately $16,000. Now, let's say that you appeal a portion of your assessment and you're able to get your assessed value reduced to $520,000. There are other folks in town who are also successful at getting their assessments reduced, so that at the end of the process the total ratable base is now $1.9 billion (down from $2 billion). In order to collect the $56 million needed for the town, county and schools, the rate would have to be 2.9%. So, after your appeal, your new taxes would be $15,100. So reducing your assessement by $60,000 saved you $900 in property taxes. The $56 million is a constant, so if total assessed values go down, the rate has to go up. |
Njjoseph
| | Posted on Thursday, February 8, 2001 - 11:43 am: | |
Dytunck, I understand what you say, and agree with a lot of it. However, my take was that the formula for land was based on ACTUAL SALES. Therefore, 'X' is not subjective. Using a residential cost approach, 'Y' is only subjective with respect to class/quality. If we for a moment say that 'Y' is not subjective at all, then 'Z' is not subjective. It doesn't take an Einstein to come up with a reasonable formula for the land.
Then once the formula was determined, it was applied UNIFORMLY across all properties in the VCS. Then, taking 'Y' for an unsold house, then 'Z' based on the formula just created, arriving at 'X' is easy.
If you know that I am wrong on this, please let me know, however I did not understand that the formula was arbitrary because it used properties that hadn't sold.
I watched last night, and appreciate Ed's comments, but his presentation skills could be drastically improved. Some sort of overhead slide with examples would have helped, as well as some explanation as to the specifics that were used to determine whether class/quality is 16 or 18 or 20, other than frame house vs. stately home. For example, sheetrock vs. plaster, wooden floors, tile floors, elaborate moldings, storm windows, etc. I wonder if he was being somewhat ambiguous, or he just needs to organize his presentations better. |
Njjoseph
| | Posted on Thursday, February 8, 2001 - 11:46 am: | |
Thanks, Overtaxed, for the eloquent example! It just goes to show you that large decreases in assessed value don't give you large decreases in taxes. |
Overtaxdalready
| | Posted on Thursday, February 8, 2001 - 11:50 am: | |
My pleasure. I think I should have used quotation marks around the word "constant" in reference to the $56 million of budgets we need to cover, since that's probably going to rise in 2001 as well. |
Njjoseph
| | Posted on Thursday, February 8, 2001 - 12:05 pm: | |
Well, if the budget goes up to $58 million and the tax rate goes up to 3%, the $520K house pays $15600. It's possible, otherwise we eliminate the music program. Oops! Another controversial topic on another thread. Forget I said anything. ;-) |
Dytunck
| | Posted on Thursday, February 8, 2001 - 12:06 pm: | |
Jenny:
Ed confirmed with me that he and CVI only considered 2000 sales in establishing the benchmark. I asked him to repeat it. He did. I wrote it down and asked if I could quote him on that. He said sure. So I am.
He also told me that any sales from 1999 had to be "bumped up" to reflect the 2000 market. (Because our taxes have to reflect the market price of October 1, 2000.)
At the televised meeting, I again asked him to confirm this. When he stated that the only purpose for using a 3 year period was to determine whether or not there was a trend, I asked him whether there was an upward trend for 2000. He said yes.
So folks, all our assessments are based on the housing boom market of 2000. Was it a housing boom? Bidding wars, over-paying and and the trend EG refers to indicate so.
Yvette:
I can post some data for you later on. I presented my findings at the TC meeting on Tuesday.
My presentation was meant to:
- Rebut statements from the TC were not exactly factual ("the majority of the town will see no change,")
- Prove valuations of the town as a whole were too high, setting off a pendulum of extreme tax increases and decreases.
- Visually illustrate the geographic impact of the revaluation on a color coded map of the town.
- Demonstrate that CVI is not a company that can be relied upon for the next ten years worth of tax revenue distribution.
The bubble market at which the town was assessed, and as confirmed by Ed Gallante, proves these assertions.
MTF
Dytunck |
Mtierney
| | Posted on Thursday, February 8, 2001 - 12:21 pm: | |
I'm in a tight spot. I cannot find an area on my property card that's in error - right number of baths, description of building, etc. Land values, after last night's meeting, is another issue. How can our assessor "take off" the view charge for the golf course just like that? How can he adjust the traffic woes along Maplewood Avenue and several other streets just like that? My guess is the Prospect group will win an adjustment for an arbitrary value placed on a portion of Prospect St. with no recognition of the traffic impact there. Rating Prospect land value the same as the Crescents was nuts at the get-go.
With so many "adjustments" - let's not call them CV "mistakes" - everyone else is going to feel the pain. The east side will have to see their decreases change as this burden shifts.
My taxes since 1990 averaged a $437 increase each and every year. I didn't like it, but excepted the increases as a cost of living thing. The proposed tax increase is EIGHT times higher than these past yearly tax increases!
Yes, my house value also went up FIVE times, but we hadn't been planning on moving - I always thought I would go out feet first.
When the word goes out that Maplewood's taxes are the highest in the state while its schools show poorly in comparisons, just watch those property values plummet.
Oh, I think our mayor did a fine job at the workshop. I'm more knowledgeable about the process, but see no hope for a reasoned response to the tax problems we face.
Phasing in financial disaster only delays the reality.
CV just made too many mistakes. Raising taxes $4000 and more in one year had to have raise doubts. Our TC had to have been able foresee this rebellion by taxpayers.
At the Feb. 6 meeting someone used the example of a seesaw. It was not balanced before and it will certainly not be balanced with this reval. |
Dytunck
| | Posted on Thursday, February 8, 2001 - 1:07 pm: | |
NJ:
I like an open discourse. Thanks for your counterpoints. But look at the facts:
Actual sales in 2000, if that's what we're basing our valuations on do not reflect the assessments.
There were 422 property sales in 2000. Only 1 (one) assessment matched the *actual sale* price. There are a handful of very close assessments - within a couple hundred. There are numerous off by as much as several thousand, even one off by over $200,000. But one out of 423 matched.
Look at these results:
| | Number of Sales | Average | Jump over Prev Yr | | 2000 Actuals | $141,583,872.00 | 422 | $335,506.81 | 53% | | 2000 Assessments | $119,315,400.00 | | $282,737.91 | | | Difference | $22,268,472.00 | | | | | Percent Difference | 19% | | | | | | | | | | | | | | | 1999 Actuals | $104,852,187.00 | 477 | $219,815.91 | -1% | | 1999 Assessments | $120,251,700.00 | | $252,100.00 | | | Percent Difference | $(15,399,513.00) | | | | | -13% | | | | | | | | | | | | | | | 1998 Actuals | $113,278,354.00 | 510 | $222,114.42 | 10% | | 1998 Assessments | $141,356,600.00 | | $277,169.80 | | | Percent Difference | $(28,078,246.00) | | | | | -20% | | | | | | | | | | | | | | | 1997 Actuals | $87,159,990.00 | 431 | $202,227.35 | 13% | | 1997 Assessments | $127,428,300.00 | | $295,657.31 | | | Percent Difference | $(40,268,310.00) | | | | | -32% | | | | | | | | | | | | | | | 1996 Actuals | $62,684,298.00 | 351 | $178,587.74 | | | 1996 Assessments | $92,840,000.00 | | $264,501.42 | | | Percent Difference | $(30,155,702.00) | | | | | -32% | | | | |
Analysis:
Average sales in 2000 skyrocketed. (Market boom)
Assessment was 19% below Actual value. (hmmm?)
Previous years, assessment is well above actual market.
Conclusion: The assessors adjusted the 2000 sales due to the market bubble. But only 2000 sales. Everyone else pays for the market bubble.
This is a flawed assessment.
Dytunck |
Jennie
| | Posted on Thursday, February 8, 2001 - 1:27 pm: | |
Teach: NJ was saying that the assessment is self-correcting. Not true. You can appeal or wait for the next reval (maybe sooner than 20 years if the Certified software works?). Hope you're not too busy to go to Newark with your appraiser.
Mtierney: With each adjustment, the reval gets more out of whack. Those adjustments provided to appease some mean a tax rate hike for all (a double whammy for those not complaining--they don't get their errors fixed, and have to pay even more since others do). How many adjustments does it take to make the initial presumptions meaningless? Another victory for fairness.
NJ: Sorry for the aberration talk--at least I didn't say flaw ;-) I don't know about other areas, but in my area I'm seeing post October sales of hundreds of thousands of dollars less than the comparable sales used for the reval. Sure, they don't count, but they do point out that the numbers used were based on a fluke. Example, Maplewood Ave comparable used to value my house--$699,000. Post-Oct sale on Maplewood Ave (same side, same section)--$410,000. Walton Rd comparable used to value my house--$651,000. Post Oct sales on Walton Rd. $415,000 and $196,000 (far less than land value alone). Those mid to high $600,000 sales did not take place in a usual market, but a highly charged, won't happen again any time soon no matter how much you wish it, type market. I can't believe those sales determined my land value (which is more than my house value) before anyone even looked at my house, and resent that the burden falls on me to correct the error by appealing. |
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