A continuing Newsday investigation into the Nassau County property tax assessment appeal system has uncovered some of the inner workings of an operation that has the feel of a racket.
The unfairness of the process, dominated by tax appeal firms that donate millions of dollars to politicians and party organizations, is now obvious despite the refusal of former county executive Edward Mangano to release much of the information about how it all worked.
There is so much more we need to know, information that is best discovered through a grand jury subpoena.
There’s no doubt the system has been inequitable, unfairly rewarding the savvy and unfairly harsh on others. It’s also been an engine of fabulous wealth creation for the biggest tax grievance firms, and punitive to people who handle their own appeals, or don’t even file one.
The Newsday series by Matt Clark convincingly refutes the claims elected officials have used to gaslight taxpayers: You must file an appeal or your taxes will go up, but you don’t need to use a service that commands a fee. County officials tell people to simply file their own grievances; legislators have made shows of holding seminars to teach people how.
But it turns out people who handled their own appeals regularly got far smaller reductions than those who paid the professionals. And those professionals getting a hefty share of the money saved were using it to line politicians’ pockets.
These firms have earned more than $500 million in fees since 2011, money that was largely generated because Mangano, one of the biggest recipients of financial contributions from tax appeal companies, created a system that allowed it.
Mangano froze assessments in 2010 and changed the system so residential challenges were settled before tax rolls were finalized. This saved the county $20 million to $30 million a year because it did not have to refund taxes used by school districts and other municipalities.
In the past seven years, 72 percent of Nassau property owners appealed their assessments at least once. Some did it every year. But the reductions don’t change the amount of money the county needs to collect to deliver services. Instead, the tax rate simply goes up. So one year you get a reduction, the tax appeal firm gets half your savings, and your neighbor, the one who didn’t appeal, pays more to cover the difference. The next year, your neighbor gets a reduction, the tax appeal firm gets half of those savings, and you end up paying more to make up the difference. Taxpayers who file their own appeals often get lower reductions. And the 28 percent who never appealed their assessments got crushed as their tax rate skyrocketed.
Nassau County District Attorney Madeline Singas has the power to uncover what county officials are working so hard to hide. Was this a criminal scheme, or just the clever exploitation of a bad plan by Mangano? Either way, taxpayers need to know what happened, why, and what needs to be fixed. Singas has the power to ask that a grand jury be impaneled for the purpose of making recommendations “in the public interest.” Uncovering why this broken system was allowed to go on certainly fits that definition.