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Property values a two-sided coin

By Times editorial
Published August 27, 2006

The annual property tax notices were mailed out on Friday, Aug. 18. The next day, the phone started ringing at Property Appraiser Melanie Hensley's home.

Shock and awe have set in among many of the county's property owners as they see just what Hensley's office says their land is worth.

The real gripe, how that value translates into their property tax bill, is outside of Hensley's control. As she is quick to point out, she doesn't set any tax rates, just the property values.

Angry property owners have been swarming the gates, swamping the phone lines and filling the e-mail baskets at the Property Appraiser's Office, demanding an explanation for their higher values. Employees have been working mightily to keep pace with the complaints and to try to spell out just how the numbers were arrived at.

It has not been an easy sell.

Hensley herself has spent hours at the public service desk answering the incoming calls. "As soon as I would hang up, the phone would ring again," she said, describing a pattern that has not stopped for days.

What's fueling the fire is the stunning increase in taxable values around the county as reflected in the notices.

The roaring real estate market over the last three years has driven up land values throughout Citrus, with areas such as Sugarmill Woods seeing a 45 percent overall increase, Beverly Hills rising 25 percent and Inverness going up 30 percent. Citrus Springs shot up a mind-boggling 95 percent.

When folks were selling their properties at the inflated prices or cashing out their equity or buying vacant lots and houses with the intention of selling them for a quick profit, or "flipping" them, few were complaining.

But the real estate market is frosting over now. The problem is, the tax rolls are by necessity a year behind, meaning they reflect the market value as of Jan. 1, 2006, not today's prices.

People looking at their tax notices now figure that they are way out of kilter with reality, and they may be right. A runaway roller coaster of a market will do that.

For instance, if you bought property in early 2005, you likely saw the value soar during the rest of the year. The market value as of Jan. 1 very well could have exceeded your purchase price, meaning your investment was growing.

With the market cooling, few expect to get that price today. And they do not wish to pay taxes on a value that is higher than what they think their property could fetch today.

(Interestingly, records show that the median sales price for single-family houses in Citrus - excluding mobile homes - has stayed fairly steady at about $155,000. Sales counts, however, are way down.)

People who sought to downsize last year by moving to a smaller house expected to pay lower taxes as a result. Instead, they have been shocked to see just how much their property tax bill has risen.

That's because they lost their 3 percent cap on assessed value when they moved. If they intend to live in their new house, and claim the homestead exemption, they will get the 3 percent cap back, but on the higher value.

Efforts in Tallahassee to make the cap portable stalled this year, but Hensley noted that the push is not dead and homeowners may yet get the right to transfer their tax cap to their new homes.

Owners of commercial property, vacant lots and homes not covered by the homestead exemption and the 3 percent cap have also seen their tax bills soar, in many cases doubling in a single year.

For many beleaguered residents, the higher tax bill could not have come at a worse time. The confluence of record homeowner insurance prices, rising gas costs, out-of-control electric bills and other factors are shrinking family budgets.

Frustrated residents know they cannot complain to the out-of-touch oil company execs and that the utilities, as monopolies guaranteed a profit, are simply laughing at their plight.

But they can, and do, yell at the property appraiser. (A more effective step, though, would be to demand that the County Commission and other taxing authorities drop the tax rates. These folks are rolling in cash now because of the higher values and they are looking to spend your money like drunken sailors.)

More than just venting your anger, however, a complaint to the property appraiser could be productive. If you truly believe that the information is wrong, contact the appraiser. They are required to do a review.

You can help yourself by doing some homework. Research the sales prices of comparable properties (not the listing price, but the sales price). You can use the property appraiser's Web site (www.pa.citrus.fl.us) or ask a real estate agent to help you.

If you recently bought your home, you will have an appraisal. But it must be current, not one from two or three years ago.

You can file a petition to go before the Value Adjustment Board, but you must file it by Sept. 11. You can get the petition form at the appraiser's office or online. (Elsewhere in the Times today, Hensley has a detailed explanation of the petition process.)

To her credit, Hensley encourages people to file petitions and to challenge their notices if they feel the numbers are off. And her office is doing all that it can to make the process simple.

"We make changes this time of year," said her chief deputy, Les Cook. "Don't hesitate to contact us."

Ah, don't fret, Les. They are heeding that advice.

[Last modified August 27, 2006, 06:40:43]