RUCKERSVILLE CITIZENS COUNCIL
Check out our website at http://www.orgsites.com/va/ruckersvillecitizens/index.html
Minutes of April 1, 2008 Meeting
Next meeting Tuesday, May 6, at 7:00 at the Fire Hall – see last item
Discussion with County Tax Assessor Ken Lacey. (Commissioner of Revenue Larry Snow was ill and asked to be rescheduled.)
1) Real Estate Tax assessment procedures:
a) General functions of County Tax Assessor: Ken explained that the assessor’s office reassesses all real estate in the county every second year. The state requires reassessment at least every sixth year, and some jurisdictions reassess every year. Ken’s office begins physical review of every property beginning September of odd numbered years, and takes about 12 months to review each property for additional improvements and other changes. Then reassessment notices are issued in November of even numbered years. The county’s tax rate as adopted by BoS annually in April, multiplied by the assessment, decides the actual tax levy for the next year. For example, the County’s tax rate adopted in May 2008, will apply to the assessment values sent out in November 2008, to determine tax levies to be paid June and December, 2009. The tax rate will likely change for 2010 (depending on budget adopted one year from now), but the assessments will not change again for another year. Property owners can appeal their assessments by setting up a meeting with the County Assessor’s office as indicated on reassessment notice. The results can be further appealed to the Equalization Board. If the property owner wishes to carry this to the final appeals stage, they can take the matter to court, but the burden of proof is on the property owner to show that the assessment is invalid. The quietest period in the Assessor’s office is March-June of odd numbered years. They do required training and can do studies and queries of county data base at that time.
b) Sales of properties and lot assessments – The state requires that each county assesses properties at 85% to 99% of actual sales prices. The county assessor’ office has done study of sales for the period 7/1/06 to 6/30/07 was done to help establish assessed values for the new assessments coming out in November. For sales of unimproved land, a longer sales period of two years may be included in the study. Alan Laudermilch asked how the state acquired data to confirm that the 85% to 99% requirement is met. Ken explained that the state does a sales ratio analysis study to compare sales prices to assessed values, using more recent data. If county assessments do not fall within the required range, then the state can withhold money that they would otherwise provide to the county. In addition, the state’s “true value” study uses a percentage factor to increase assessed values to estimated actual fair market value per sales history when they establish the percentage of each county’s state-provided school cost share. (Editor’s note: Increases in “true values” greater than the state average tend to reduce the state’s contributions to local school costs.) The state historical period of sales data used is more recent than that of the county for purposes of the 85% to 99% assessment ratio, but less recent than the most current county study for purposes of setting the state’s school cost share.
c) Reassessment of existing and newly constructed buildings – All assessments of buildings are based on replacement cost as indicated in a nationwide manual, with regional cost adjustments taken into account. In answer to questions from Carl Schmitt and Nicole Strickland, Ken explained that depreciation, or reduction in value due to age, is taken into account by reducing the new table value by a stated percentage, so for example, 30 year old homes are assessed at lower amounts per square foot than newer homes in the same class. Jay Willer asked if the condition, or apparent age as opposed to chronological age, is taken into account. Ken said the condition, or apparent age, called “effective age” establishes the percentage of reduction, rather than the chronological age of the building. New buildings are assigned a “grade”, from A through E, with and additional “mansion” grade, to indicated whether construction detail is average, above average, or below average. This rating affects the assessment per square foot. Once a class is assigned, it usually does not change. Unlike the lot or raw land, selling price of a building usually does not change the assessed value, which is based on table amounts. In answer to question from Norm Slezak, Ken explained that all improvements from building permits or as seen by physical inspection or by aerial photography, are taken into account. (Generally, the tax assessor’s office avoids entering inside buildings). He also commented that the assessed building value would not be an appropriate basis for insuring the property, for a lot of reasons, such as that interior details are not considered, and that depreciation for age results in a figure lower than actual replacement cost.
d) Rezoned properties - Zoning, size, and road frontage are all considered when establishing value of rezoned lots. Assessed values are only changed every other year, (unless there is a division of the property) so the value of a property rezoned shortly after the assessment date would not be changed for almost two years. However, a building under construction is reassessed for the portion of the construction completed as of the end of the calendar year.
e) Data base information – what detail is available, what categories are tracked? There are seven categories: 1 – Urban lots with sewer, 2 – Suburban lots on septic up to 20 acres, 3 - Multifamily 4 - commercial & industrial 5 – agricultural and open land 20-100 acres, 6 – 100 + acres 7 – nonprofit. The Bright software is used, and any sort of query can be run. Best time to do it would be March-June 2009, when the Assessor’s office is not tied up with reassessments.
f) Additional questions from group:
· Ron Heinz asked how the current market decline will be taken into account. Ken explained that he is currently spending one day a week reviewing sales and listings to help establish realistic values. He does not expect increases nearly as large as the last assessment period (a 31% increase for the two year period) or the prior one (an 18% increase over the two year period). Sales in Stanardsville and Monroe seem to be holding up better than Ruckersville at present. Any increase over a two year period over 13% is considered “volatile” by the state. (Editor’s note: Some counties, such as Loudoun, are showing substantial declines, rather than any increase at all, in sales prices and assessed values.)
· Jenny Dietzel asked about the valuation of farm and forest land, and interplay with conservation easements. Ken said farm parcels have existing house lots assessed as such, and the remaining farmland assessed separately. Woodlands are assessed at a lower amount than open space farmland. There is no difference in assessment whether or not the land is under conservation easement. But since the county has a land-use policy set by the Commissioner of Revenue’s office, the actual taxes paid on farm land are based on the land-use dollar per acre figure set in any case, not on the assessed value. The state does studies to assist localities in setting land-use values for farms and woodlands. Greene currently uses those recommendations. (Editor’s Note: The state school cost share is higher for counties with lower “true value” of property, and that is based on values adjusted to actual selling price history, not assessed or land-use value.)
· Bob Grassi asked if comparables outside the county can be used, and Ken replied that in general the answer is no.
· Heather Dow asked if aesthetics on a lot, such as landscaping, affects the assessment. Ken replied that it does not since this would be an opinion issue.
· Andrea Wilkinson asked when and to what extent high sales prices of commercial lots such as the Lowe’s and Walmart spaces, would be recognized in assessments and county tax revenues. Ken replied these lots will not be reassessed at actual selling price. They will be included in the sales study, which may increase assessments on other similar commercial properties as well, but the selling price of an individual property does not establish the assessment on that property, per state guidelines.
· Jerry Gore asked how “depreciation” applies to historical properties, and what the effect of paving a long driveway is on the assessment. Ken says there is a “historical factor” that he can apply to get closer to market value on these properties. Paving the driveway is an improvement that adds to the assessed value based on the estimated square footage of the pavement.
· Larry Miller asked if prior assessment is used as a base. Ken said the information about building and lot size is used, but any building permits or visible additions not covered by a building permit, are added to the building value.
· Chris Capone asked what happens if addition is done without permit and not to code. Ken replied that the addition is assessed same as if proper permitting and code had been followed – deficiencies would be handled between buyer and seller, or other authorities.
· Jay Willer asked if sales of large new commercial properties would affect assessments of nearby properties. Ken replied that as sales history is established, that would determine the answer. Regarding the commercial property itself, there is a “cost to cure”, or expenditures required to bring the property to useful stage. As this is spent, assessments on the commercial property would increase. If sales history showed that selling prices of surrounding properties went up, then assessments would go up, and if selling prices went down, assessments would go down.
2) Old business we forgot to discuss – should we apply for “official county recognition”, and if so, how? Group did not feel we needed it at this time.
3) New business –
a) Website reformat – suggestions?
b) Officer listings on web site – e-mail & phone contact info? All officers approved adding their e-mail and phone numbers to the website. (Editor’s note: This was done on 4/20 – there is a click link to send an e-mail to the officer.)
c) Upcoming rezone & residential density action at Planning Commission April 16 – 832 residential lots per information currently available.
4) Next meeting Tuesday, May 6 at 7:00 PM at the Firehall. Our guest will be Herb White, President of WW Associates, the engineering firm who has prepared a Greene County Water Supply Plan. This is not the plan required by the state, but provides some of the information for that plan. He has an informative and interesting presentation for us, which will be followed by our usual roundtable discussion on the topic.