The ghost of assessment past: Why your taxes are high when land value is low
The past will come back to haunt you. In the world of property assessment, two years in the past directly affects the present.
On March 26, 2013 the Douglas County assessor and auditor/treasurer offices will be sending out nearly 30,000 assessment notices and tax statements. Property sales from October 1, 2010 through September 30, 2011 affect the 2012 assessed values for the taxes residents will see on their payable 2013 tax statements.
"The assessment notice is the document that advises all property owners of the valuation and classification assigned to their property for the 2013 assessment for the property taxes they will pay in 2014," Douglas County Assessor Keith Albertsen explained. "The tax statement is for taxes payable in 2013 and are based on the 2012 assessed values."
The 2012 assessed values are calculated using sales from October 1, 2010 through September 30, 2011. The 2013 assessment values, set by January 2 each year, are based on sales between October 1, 2011 through September 30, 2012. So, today, residents are paying taxes from circumstances two years ago.
Albertsen said the number of sales have gone up but prices have remained relatively flat for residential and seasonal properties. Agricultural property values are on the rise, especially for tillable property.
Assessed values go up or down contingent on actual selling prices of open, or "arm's length," sales transactions. Albertsen said "short sales," such as bank foreclosure sales, are rejected from the state sales ratio study.
Sales overall have been going up and down over the past five years in Douglas County. Albertsen said commodity prices going up can affect the value of farmland.
"When the assessed values are too low compared to the sales prices, assessed values have to go up," Albertsen explained.
When commodity prices go up, tillable land prices increase, resulting in a lower assessment value.
"Worth is a product of supply and demand," Albertsen said. "There's a lot of demand for tillable property at this time. Indicators show it's still going up."
Albertsen said changes made to the homestead credit by the Legislature in special session in 2011 were first reflected in 2012 tax statements.
"The homestead benefit is not gone," he said. "It was changed from a direct credit to a value exclusion."
There may be some relief available through the state Property Tax Refund program for homestead properties. Albertsen said it is a two part program. One compares property taxes paid with income and may qualify some people for a partial refund; the other compares the increase in the property tax from one year to the next; income is not a factor. Since tables have changed, a person who didn't qualify for the Property Tax Refund last year could now.
Property owners can keep current on their assessment records by checking their data on the Douglas County website. The "Real Estate Information" button on the homepage connects to a searchable database of Douglas County parcel listings. The 2013 information will be on the site around the time notices are mailed, Albertsen said.
If a person disagrees with their assessment classification, value or information in the summary, they should contact the assessor's office. If a question or issue cannot be resolved, the property owner can appeal to the local Board of Appeal and Equalization. Assessment notices will include information on when the board meets.
Albertsen advises property owners to notify the assessor's office when making any changes, such as tearing down a building, so the assessment is as accurate as possible. Assessment checks are done approximately once every four years in Douglas County. Questions on assessment notices should be directed to the assessor's office at (320) 762-3884; tax statement questions are handled by the auditor/treasurer's office, (320) 762-3077.
Crystal Dey Crystal Dey is a staff reporter for the Echo Press. Originally from Minnesota's Iron Range, Dey worked for newspapers in North Dakota, Florida and Connecticut before returning to her home state to join the Echo Press in October 2011. Dey studied Mass Communications at Minnesota State University Moorhead with an emphasis in Online Journalism. Follow Staff Reporter Crystal Dey on Twitter at @CrystalDey_Echo.