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Nassau County delays property reassessment planned for 2018

The halt means taxpayers who have not been awarded one of the overhaul’s substantial assessment reductions will continue to pay for the tax savings of those who have been.

The Nassau County Department of Assessment in Mineola

The Nassau County Department of Assessment in Mineola is shown on Thursday, Jan 12, 2017. Tax payers come to the office if they have questions about their property taxes. Photo Credit: Newsday / John Paraskevas

Nassau properties will not be reassessed early next year as planned, a county official said Friday, a development that will cost or save property owners hundreds or even thousands of dollars depending on whether they have challenged their assessments successfully since County Executive Edward Mangano’s overhaul of the tax system began in 2010.

County officials announced the reassessment in 2015 after years of delays and said it would be finished by January 2018. Under state law, that required sending notices of the new assessments to property owners by Friday — four days before Tuesday’s election in which the county executive and all county legislative seats are on the ballot.

Now, that won’t happen, even though the county’s assessment system has emerged as a campaign issue. Mangano, who was indicted on corruption charges that he is fighting, chose not to run for re-election.

The halt means taxpayers who have not been awarded one of the overhaul’s substantial assessment reductions will continue to pay for the tax savings of those who have been — a tax shift that has already grown to $1.7 billion, a Newsday analysis revealed earlier this year. The Mangano administration’s decisions to award those reductions while freezing most other assessments since 2011 largely reversed years of successful efforts to make the assessments more fair and accurate, Newsday found.

The reassessment, which would also have ended the freeze, was expected to bring the assessments of Nassau’s more than 400,000 properties back into balance and would therefore have shifted taxes onto many of the property owners who have appealed successfully.

Acting Assessor Jim Davis said in an emailed statement that it became clear more work was needed to ensure the new assessments are accurate after reviewing the findings of two contractors hired to complete part of the reassessment process.

“In the best interest of the property owners of this county and until such time as it is determined that the values put forth are correct, the freeze will remain in effect,” Davis said. “The administration decided to provide the most accurate and complete information to the next county executive for their use in assessment.”

Whether the reassessment will even occur and how it will be handled will now be up to the next administration. If officials move ahead with the reassessment, they could use the delay as a way to give property owners added time to review and seek changes to the new assessments well before the county calculates more than $6 billion in tax bills covering its own needs and those of school districts, towns, fire departments and other governmental agencies.

Some taxpayers and officials are not interested in waiting another year, as the freeze has already doubled in length from the four years Mangano promised when it started. Mangano has said in the past that he regrets the delays, which he described as unavoidable and in part due to superstorm Sandy.

Long Beach City Manager Jack Schnirman and the Long Beach City Council sent a letter Oct. 19 to Davis, urging immediate action on the disparities caused by the overhaul. The letter came after Long Beach residents who rebuilt Sandy-damaged homes received school tax bills that had doubled in size from a year ago. Two of the council members are running for re-election and Schnirman is seeking to be elected county comptroller.

Mangano’s freeze on assessments doesn’t apply to homes that are damaged or improved, and as a result repaired Sandy homes that didn’t challenge saw their tax bills increase both because of the improvements and the taxes shifted to them from those who did appeal successfully.

Newsday’s estimate of the cumulative $1.7 billion tax shift accounts for grievances settled from the 2011-12 tax year through the 2016-17 tax year, for October 2016 school and January 2017 general tax bills. The shift for 2016-17 alone was $405 million.

It was largely responsible for the tax bills of a typical property owner who has not appealed increasing $2,748 or 35 percent compared to an increase of $466 or 5 percent for those who did. That annual shift is expected to grow for the next two years at least, because the process of settling challenges for 2017-18 and 2018-19 has already begun. It will also be borne by an even smaller number of property owners who have yet to file.

If done accurately, a reassessment would largely shift the burden back. However, since it will not occur for the 2019-20 tax year as planned, those who don’t file will end up paying for the savings of those who did for at least one more year.

The halted reassessment was to be the first comprehensive review since 2002 of the data the county uses to value property and set assessments. That reassessment occurred as part of the settlement of a lawsuit alleging the county was overtaxing homeowners in minority communities. By adjusting assessments each year to reflect the real estate market’s changing prices, the county maintained high levels of assessment accuracy and fairness thereafter, according to studies by the county, state officials and Newsday.

Now, residential assessments are outside of all major industry standards for assessment accuracy and fairness and overtax homeowners in predominantly minority communities more so than they did in the year before the reassessment, Newsday found in its study, which was conducted with the assistance of national experts.

Two Mineola firms, Standard Valuation Services and Michael Haberman Associates, were awarded $3.8 million in contracts to perform much of the reassessment work with county oversight by September. The county was then expected to fix any outstanding issues and send notices to property owners.

Davis said the contractors’ work will be completed on schedule, but their preliminary findings indicated that “there is a need for further development of our systems to be assured the values are defensible and allow the property owners in this county to be confident that they are paying their fair share.”

Among those affected by the assessment overhaul is Claudia Decker, who was among the Long Beach homeowners local officials heard from before sending their Oct. 19 letter to Davis. Decker expected her tax bill would increase after rebuilding her home, which Sandy destroyed. But she didn’t expect her school district taxes to go from $4,000 to $10,000 in one year.

Receiving a tax bill that much higher and realizing she had four weeks to make her first $5,000 payment was “absolutely the most insane thing I have seen in my life,” Decker said.

Long Beach Assessor Raymond Flammer said Decker’s home was assessed by the county at a market value of $602,900, which he said is about what it would sell for. But what Decker did not know is that if she filed a challenge in 2016 under Mangano’s program, the market value would have lowered to about $390,000, 36 percent less than her home is actually worth. Instead, her tax bill went up largely because of the savings of the thousands of property owners who did challenge being shifted onto her bill. Her taxes will go up again next year, too, because the grievance deadline affecting those tax bills was in March.

“Why should I, who have owned a house for 20 years in Nassau County, even have to consider going through that,” Decker said of an assessment challenge. “The crime here is that the county is not assessing people’s homes properly.”

The reason Decker’s assessment would have been so much smaller if she had filed is that under Mangano’s overhaul the county began assessing properties that challenge at much smaller fractions of what they are worth than those that have not. The county has never fully promoted this fact, Newsday revealed in its investigation, and Flammer said the Long Beach officials believe the county could still address this before the next assessments are released in two months by indicating to homeowners who have not challenged that they could be overassessed.

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