Nassau property tax challenges at 10-year high

An aerial view shows a neighborhood in Nassau An aerial view shows a neighborhood in Nassau County near Hempstead turnpike. Photo Credit: Kevin P. Coughlin, 2011

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Property tax protests in Nassau this year jumped to the highest level since the countywide reassessment 10 years ago, totaling 151,360, according to assessment department numbers.

The total reflects a near 16 percent increase in protests over last year, primarily from single-family homeowners.

Aides to County Executive Edward Mangano blame the increase on superstorm Sandy and a subsequent two-month extension of the protest period, though critics say Mangano encourages protests by granting too many assessment reductions.

The rise in protests also comes after school tax rates climbed an average 11.7 percent countywide last October, pushed up primarily by falling home values and successful assessment challenges. As a result, taxpayers whose home assessments stayed the same or increased saw their school tax bills soar, some by more than $1,000.

For the first time in recent memory, Mangano announced last year that his administration had reviewed and settled all residential challenges before school tax bills went out. As a result, he said, the county saved the average $20 million in refunds Nassau has owed each year for more than a decade to homeowners who successfully protested their assessments.

A Newsday review found 84.7 percent of homeowners who filed challenges -- about 94,000 throughout Nassau -- won assessment reductions in 2012.

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When a home's assessment goes down, neighbors pay higher taxes if their house assessments remain level or increase -- even when the total amount of taxes collected by the school district stays the same.

Deputy County Executive Edward Ward said the county this year reduced assessments for 87 percent of single-family homeowners who protested, primarily because "they were very much impacted" by Sandy.

Nassau reports that 5,207 homeowners requested Sandy-related assessment reviews, about 25 percent of the increase in residential protests. Ward said values for entire neighborhoods can go down when just some homes suffer damage.

Legis. David Denenberg (D-Merrick) said he wasn't "surprised we have record amounts of grievances. To avoid refunds, Mangano has reduced assessments upon request, thereby increasing taxes on anyone who doesn't challenge. So people are understanding if they don't challenge they're going to get a tax increase."

Ward responded: "When you hold county forums on assisting residents on how to file for reductions in taxes, you should not then turn around and criticize the county for the reduction in assessments that are made."

Denenberg acknowledged he has been holding tax forums since he first took office in 2000, but said that doesn't explain this year's jump in protests.

"I'm proud in assisting residents in reducing their tax burden," Denenberg said, adding that he teaches residents how to challenge their own taxes rather than pay tax appeal firms as much as 50 percent of tax savings.

County records show that tax appeal firms filed 88 percent of the 130,807 single-family home protests this year.

Tax appeal attorney Fred Perry said he has already advised his clients to expect only slight reductions, especially if they have challenged in the past year or two.

"In my view, people are very close to where they should be if they settled fairly with the county," he said.

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The largest number of protests came a decade ago after Nassau reassessed all of its properties for the first time since 1938. Notice of the new assessments went out in mid-2002, and businesses and homeowners filed a record 160,548 challenges in early 2003.

Traditionally, the county has borrowed to pay some or all of the $100 million in tax refunds generated annually by residential and commercial challenges. The increasing burden of successful tax protests was a major reason why the state created an oversight board in 2000, which took control of Nassau's finances in 2011.

In a political dispute, Nassau Democrats last year refused to approve further borrowing, leading to a backlog of unsettled tax challenges estimated at $335 million. This year, Democratic legislators agreed to borrow $75 million to pay refunds if the administration paid $20 million from its operating budget.

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