Levinson: How Nassau has made the assessments mess worse
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Front-page stories in Palm Beach County, Fla., report that countywide taxable property values have increased -- "a sign," according to the Palm Beach Post, "that the once free-falling real estate market is finally on the mend" and generating new revenues for local governments. It's happening all over the country.
Not so in Nassau County, where the news is that property tax challenges have jumped to a 10-year high.
Nassau's tax base went down significantly last year and will do the same this year. Why? This loss of taxable value was caused by the county's unilateral decision to freeze property tax assessments for four years and to accept settlements with tax-reduction companies to reduce 80 percent of assessment challenges, including many multimillion-dollar properties.
As a result, multiple millions of dollars in taxable values were wiped off the tax roll last year -- Newsday reported a loss of 7.3 percent of assessed value -- and will do so again this fall. School tax rates in October will rise again. Property owners who did not grieve their assessments will see their school tax rates skyrocket. Even of those who won reductions, many will see their school tax bill climb.
Remember that the so-called 2 percent property tax cap applies to schools', towns', cities' and counties' overall tax levy -- the total amount the jurisdiction collects from taxpayers -- not to property tax rates, which are applied to properties' assessed values to achieve the levy. And if one party lowers its assessment through a successful challenge, others will see their rates increase.
The culprits in the new phenomenon of huge hikes in school tax rates are the tax-reduction companies now joining forces with county government, behind closed doors, reducing assessments across the board.
These maneuvers cost the county nothing, but transfer the burden of higher tax rates to homeowners. It is clear that the county did not understand the consequence of freezing assessments and removing millions of assessed value from the tax roll. The only parties who have benefited are the handful of tax-reduction companies and a few tax certiorari lawyers, who are doing quite well and have done so for the last 20 years.
The acting assessor, James Davis, and his skeleton staff have done yeoman's service under trying times to keep the department afloat. Sadly, the county administration has made no effort to defend its tax roll, which is now unequal, unlawful and full of properties that are not uniformly assessed based on market value.
The state Department of Taxation and Finance should step in to oversee the county's department of assessment. And we need some new laws.
Nassau should consider adopting some of the assessment practices in Palm Beach County, where I now reside. The populations of Nassau and Palm Beach are the same. Palm Beach County has about 6,500 assessment challenges per year; Nassau has 150,000. The county appraiser in Florida, who is comparable to the assessor, has carte blanche to reduce assessments. The Nassau assessor does not, but he or she should be able to correct assessments without having to seek approval of the Assessment Review Commission, which can take up to 18 months. The appraiser in Florida values sold properties on the sale price minus 15 percent, to account for commissions, cost of sale, etc. Because property is valued at 85 percent of the sale price, few appeal.
Florida residents' assessments can increase annually only by 3 percent or the cost of living, whichever is less, and are valued every year by the same computer program used in Nassau. Any legitimate challenges in Florida -- such as errors in square feet, number of baths, size of land -- are resolved quickly, some on the phone!
If a solution cannot be found, there's always another approach: The Department of Assessment could be closed, and Nassau's three towns can appoint assessors.
Harvey B. Levinson, a Democrat, was Nassau County’s last elected assessor, serving from 2004 to 2008, before the position was made appointive.