Nassau data: Fewer low-income home owners seek tax reduction

On their first day as homeowners, Alberto and On their first day as homeowners, Alberto and Dolfania Polanco look over their closing papers. The couple recently found out from their real estate agent that they are qualified to grieve their property taxes on their newly purchased home. (July 12, 2012) Photo Credit: Newsday / John Paraskevas

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Residents of lower-income and minority communities across Nassau County are far less likely to challenge their tax assessments than those in higher-income areas, potentially leaving these areas out of a yearly windfall that saves an estimated $20 million in property taxes for homeowners.

A Newsday analysis of county assessment data found that fewer than 15 percent of the residential properties in communities such as East Atlantic Beach, Roosevelt, Uniondale, Glen Cove, South Floral Park, Inwood and Hicksville had challenges. By contrast, more than 75 percent of the residential property assessments in Port Washington North and North Hills were protested. In Woodbury, Lawrence, Great Neck Estates, Roslyn and Sands Point, more than half of the residential assessments were protested.

Fifteen of the 126 communities Newsday studied had protest rates of less than 20 percent. Ten of those 15 had household median incomes below $85,000 and seven had populations where more than half of residents identified themselves as black or Hispanic, according to Census Bureau data. Of the 12 communities Newsday analyzed where more than 45 percent of the residential properties had challenged assessments, just one had a household median income below $85,000, and none had populations where more than 20 percent of residents identified themselves as black or Hispanic.

The analysis showed that when residents did challenge their assessments, they were likely to win. Of the nearly 100,000 protests filed last year, two-thirds resulted in some type of reduction.

Experts say communities that don't protest in large numbers are potentially left with overassessed homes and overtaxed homeowners. And, some say, homeowners who don't successfully challenge often make up the financial shortfall created by those who do win assessment reductions and, in some cases, refunds.

"The financial impact can be very significant to these lower-income communities . . . " Nassau County Comptroller George Maragos said. "From the perspective of fairness and equity, it does matter -- a lot."

For years, county officials, legislators and others have criticized the county's assessment system as error-ridden, citing issues such as the system's calculations, technology and staff training.

Vow to fix 'broken' system

When he took office in 2010, County Executive Edward Mangano promised to fix the "broken" system and end borrowing to pay for assessment reductions and refunds by 2015. Despite firing an assessor, creating review teams, hiring consultants and making some changes, including adding a four-year freeze to keep assessed values correct over time, under Mangano the system remains problematic and tax challenges have not declined, experts said.

"I inherited a $60-million assessment computer that does not have the functionality to accurately assess 419,000 properties annually as evidenced by the billions of dollars in errors it has made over the past decade," Mangano said.

County spokesman Brian Nevin said the system has a two-year lag, so some of Mangano's changes will take time to have a full effect.

Experts said some residents may not know they have the option to protest, others may think the process is too difficult to undertake. Still others may not have the money to pay a lawyer to help them, and so they ignore mailings from tax challenge lawyers who guide homeowners through the process for a fee.

Citing Newsday's data, Maragos said his office would undertake an outreach campaign this year "to help these communities" and to assist homeowners in determining whether they may be overassessed. In addition, Mangano will ask Acting County Assessor James Davis to host forums in neighborhoods with far fewer challenges.

Properties reviewed

Newsday analyzed 384,294 residential properties in the county's assessment roll, based on what is labeled as "property address" in the official roll. That review showed that some addresses that are in one community are listed as being in an adjacent one. This issue did not affect Newsday's analysis because of similar demographics in these communities. County officials, including Maragos, did not dispute the conclusions and agreed with the methodology.

Beyond what appear to be mistakes connecting a home address to the correct community, the analysis shows that certain neighborhoods are benefiting from the grievance process far more than others. In Lawrence, for instance, 1,140 of 2,125 residential properties had challenges filed -- 54 percent. Of those, 924 obtained some type of reduction on their assessments, Newsday found. In Roosevelt, just 464 of 3,940 residential properties had challenges filed -- 11.8 percent. Of them, 388 obtained a reduction. That meant more than 80 percent of the small number of protests by homeowners there won some relief.

"It is obviously disturbing to find yet another inequity that no one is paying attention to," said Elaine Gross, who heads Erase Racism, a Syosset nonprofit organization focused on racial equity. "We know that intentionality is not required to create the disparity. What's really insidious about the whole thing is if you do nothing, because if, historically, the differences have existed, they will just continue."

Attorneys who handle tax protests expressed concern that the disparities may mean that some communities' assessments will become more accurate while others will remain incorrect.

"There's become an inherent inequity in the [assessment] roll," Mineola tax challenge attorney Laureen Harris said. "We're not reassessing and it goes unchecked . . . The disparity is going to grow larger and you're going to institutionalize unexamined inequities at the bottom."

Davis, who responded to questions in writing, attributed the differences to the tax bills themselves. He noted that Port Washington's average tax bill in 2010-2011 was $10,841, compared with $4,532 in Roosevelt.

But Gross said filing a challenge in lower-income communities can have just as much of an economic impact on a homeowner as it would in a wealthier community. And Maragos noted that since a school district's budget is unchanged no matter how many refunds or reductions are granted, those who don't grieve often have to make up the difference for those who do. He said a "weakness" of the system is that it doesn't automatically reassess one property when a neighboring homeowner successfully appeals.

Process deters some

Some residents said they know about the grievance process, but don't bother. Massapequa real estate manager Andy Yakubovsky, with Century 21 Prevete Bastone, noted that even as he encourages clients to protest, he hasn't done so on his Levittown home in more than 12 years, mostly because of the time and paperwork it requires.

"I'm a prime example of what not to do," he said.

Still others see a process that's fraught with complications, especially for owners who rent out their properties -- something more common in low- and moderate- income communities.

If challenge-related mailings go to the property address, said Legis. Kevan Abrahams (D-Freeport), the renters in the home may ignore them. The owners themselves often don't file because they find it's an uphill battle, particularly for non-owner occupied homes, said real estate investor Beth Marten, who is also a buyers' real estate agent. Marten said investment property grievances are often rejected, and the process can be more cumbersome, so some don't protest at all, though they have the right to do so. Marten said the disparities in the process "contribute to the massive blight" in communities.

"Here I am, helping out the economy and providing decent housing to low-income people. My taxes are going up and up and I can't grieve," she said. "How will I ever resell the property [when the taxes remain high]?"

Nassau County spokeswoman Katie Grilli-Robles said the process for investors is not more difficult -- but is different, due to state law. She said homeowners "do not buy homes for profit but rather to live and enjoy."

Experts and local officials said education is key, adding that residents may not know that appealing their taxes is an option.

"Maybe more information needs to go out to the communities that are not being adequately represented in these challenges," said Legis. Judi Bosworth (D-Great Neck). "We need to raise their awareness that they have the right to do it."

Gross and others noted that nonprofits may have a role to play in that effort as well.

Dolfania Polanco said she was worried about the $7,800 in taxes she'd have to pay on the Elmont  home she and her husband, Alberto, bought last month, until her agent, with Century 21 Prevete's Elmont office, told her about the protest process.

"I would have had to find out by myself and we'd probably lose money that way," said Polanco, a first-time home buyer who plans to protest this year.

Real estate broker Damien Coleman, who is owed a $1,715 refund from Nassau after grieving his taxes on his Roosevelt home last year, said residents are unaware that they can appeal themselves without needing a lawyer.

"I think we need to educate them more," said Coleman, 39, whose real estate agency, DAC Properties Corp., is also in Roosevelt. "Prices dropped $100,000 on a lot of houses here since 2005 and 2006, but they're still charging the same taxes."

Hiring tax challenge firms

The vast majority of county residents protest their taxes through private tax challenge firms that often charge up to 50 percent of whatever reduction they win. Those firms send postcards and fliers to advertise their services. Some officials said they wondered whether the discrepancy in grievances is due to who receives the postcards.

"You can guess that in higher-valued areas, attorneys find a potential for greater refunds, so they advertise and push harder in areas where the values are higher," said Legis. Dave Denenberg (D-Merrick). "And people in higher-value areas may follow through and don't let their attorneys let the case go."

Attorneys and others in the industry, however, say they send postcards across the county and don't focus on certain communities more than others.

"I don't think there's a targeting here at all," said Paola Orsini, who heads Garden City-based Reassessment & Evaluation Services.

Attorney Richard G. Fromewick, who heads the tax grievance department for Meyer, Suozzi, English & Klein in Garden City, said homeowners across the county should consider appealing, even when reductions might be relatively small.

"Especially for seniors on a fixed income, taxes going from $10,000 to $11,000 is a big deal to somebody on Social Security," Fromewick said.

Those in the industry agree the disparities should be rectified.

"If you go into the supermarket and you overpay by 10 cents for a can of soup, you should yell and scream," said Sean Acosta, with Property Tax Reduction Consultants in Jericho. "And you should do the same thing with your taxes. I'm always concerned if someone is overpaying on their taxes. It doesn't matter if you're saving $400 or $4,000, you're still overpaying."
With Celeste Hadrick

How to appeal your property tax assessment

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To file an appeal of your Nassau County property tax assessment, you can apply on your own, using online forms available at the county's Assessment Review Commission website, nassaucountyny.gov/ARC, and click on the link for AROW, the Assessment Review On the Web. You can file an appeal online between Jan. 2 and March 1 each year. You can also check the status of previous appeals that you have filed.

To file an appeal, you should know the section, block and lot number of your property, although you can also search by your address.

To get assessment information on a particular property, go to the Department of Assessment's website, mynassauproperty.com and click on Property Search.

If you cannot submit online, you can submit a paper form, available from Nassau County at the Department of Assessment, 240 Old Country Rd., Mineola. For more information, call the Assessment Review Commission at 516-571-3214.

You can hire a lawyer to help you through the assessment appeal process. Tax challenge attorneys often charge up to 50 percent of the reduction, if the effort is successful, for their services. You do not need to hire a lawyer, though, and can do it yourself.

Once you submit an appeal, the Assessment Review Commission will analyze it. County officials cannot increase your assessment if you appeal. It will either remain the same or decrease. The process can take up to 15 months, according to the county website.

If the initial application is denied or you do not accept the reduction offered by the Assessment Review Commission, you can apply for judicial review, through the Small Claims Assessment Review process, or SCAR.

Source: Nassau County

A look at Newsday's analysis

Newsday analyzed last year's Nassau County assessment roll, along with a database of property tax protests and results. Both databases were provided by Nassau County. Newsday focused on the residential property addresses listed in the roll. A reporter analyzed how many residential properties were in each community, how many of them had protests filed, and what happened to those protests. Newsday included only those communities with more than 20 residential parcels in its analysis of the tax grievance process.

The Nassau County assessment roll identifies properties in multiple ways. Each property has its own section, block and lot number. The roll also includes two sets of addresses -- one labeled as the owner's address, where all correspondence is sent, and one labeled as the property's address.

In analyzing only the residential portion of the roll, Newsday found more than 200 properties with property addresses that fall outside of Nassau County. There are 14 in Flushing, for instance and another 27 in Cold Spring Harbor. There are residential properties listed as being located in Garrison in Putnam County, and Islip Terrace and Jamaica in Queens. Newsday did not count these properties in its analysis.

Nassau's acting assessor, James Davis, said in a written response to questions that the non-Nassau addresses are the "mailing address of a given property's owner."

Newsday also found that the roll labeled some Nassau parcels as being in one community, when their postal address might list an adjoining neighborhood that shared the same ZIP code. Davis noted that the county values properties usiing the section, block and lot coding, so potentially mislabeled property addresses don't affect assessment.

Officials and experts said these issues would not affect Newsday's findings regarding grievances and where they originate.

These same issues carry over to the county's property search website, mynassauproperty.com. When researching the section, block and lot there, the code often turns up the same non-county address listed in the assessment roll, leaving the county's online records unclear as to where the property is located.

Davis added that since the roll includes more than 423,000 Nassau properties, the issue "is not an endemic or irresolvable problem."

"It should be noted that the website (which is one of the most detailed in New York State -- if not the country) was produced as a tool to provide information and is constantly being updated and corrected -- just as Newsday corrects information in its stories on a daily basis or the Post Office updates mailing addresses," Davis wrote.

-- Randi F. Marshall

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