More than half of all Nassau homeowners protested their property tax assessments this year — and tax attorneys expect most will get automatic reductions because the county has lowered a ratio it uses to help determine values.
Nassau County reported Wednesday that more than 233,000 property owners, including a record 211,921 homeowners, filed grievances from January through April of this year in hopes of reducing their property tax bill. For Nassau, which has about 424,000 total properties, this year’s protests are the most in memory.
“This is tsunami of challenges,” tax attorney Laureen Harris said.
But reducing assessments for half of Nassau’s residential property owners likely will drive up tax bills next year for the half who didn’t protest, experts say.
“If I had to guess, 3 to 5 percent increases,” said attorney Jeff Gold, who served on both the county assessment board and assessment commission and now runs an assessment-related website. “What happens is that when these homes get automatic reductions, it takes the values out of the taxing districts so the taxing districts have to increase their rates to raise the same amount of money. Someone has to make up for the 212,000 homes that will get reductions.”
County Executive Laura Curran extended the county’s protest period this year by a month in part to encourage residents, particularly in lower-income areas, to challenge their own assessments.
The move came after a Newsday investigation in 2017 found that an assessment settlement program started by former County Executive Edward Mangano in 2011 had shifted $1.7 billion in taxes from those who won assessment challenges and tended to be more affluent and those did not.
While Mangano had hoped to reduce the county’s cost of tax refunds, his decision to freeze assessments while granting reductions each year to more than 70 percent of property owners who filed challenges resulted in a total $2.2 billion shift in taxes by this January, Newsday reported.
A countywide reassessment is underway as Curran attempts to bring equity back to the county assessment roll, which is supposed to reflect market values.
“Since the prior administration froze the tax roll, lawmakers did everything they could to tell people to grieve, grieve, grieve. They knew the county didn’t have a defensible tax roll,” Curran spokesman Michael Martino said. “The goal is never to take away the right to grieve. The goal is to eliminate the need to grieve by establishing a fair and defensible tax roll.”
County officials say until the new values are issued in January, they must extend the settlement program.
Harris said, “The only way the county can deal with the tsunami of challenges effectively is to create a massive settlement system. That system, because it affects and determines most of the residential protests, creates the assessments. It creates a carry-forward system of values from 2011 and 2012, values based on a recession housing market.”
The county website says residential properties are assessed at 0.25 percent of market value; but the actual ratio has dropped annually since assessments were frozen. As a property’s market value increases, its level of assessment decreases when assessments are frozen.
The county this year has agreed to drop the level of assessment to 0.14 percent for residential properties from last year’s 0.15 percent.
Tax attorneys say a ratio reduction automatically results in an assessment reduction for most properties that have filed challenges. The ratio for everyone else remains at 0.25 percent.
Gold predicted “the vast majority will see reductions, between 80 and 90 percent.” The only properties that won’t get reductions, he said, are those that are already vastly undervalued.
Harris said the drop in the assessment ratio “doesn’t guarantee” a reduction, “but makes it highly likely. It is a credible ratio.”
Asked for examples of properties that wouldn’t receive a reduction, she suggested recently purchased homes. “It could be a sales price. Say they purchase the house for $800,000. The assessment [reflects] 600,000,” Harris said.
The county Assessment Review Commission, she said, “will tag that” and not allow any further drop in assessment.