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ROTTERDAM
Firm to report on accuracy of assessments
BY JUSTIN MASON Gazette Reporter
Reach Gazette reporter Justin Mason at 395-3113 or jmason@dailygazette.net.

    Private appraisers have finished reviewing the town’s tax roll and are expected to produce a report on their findings sometime late next month.
    Joe Emminger, president of the Buffalo-based Emminger, Hyatt, Newton & Pigeon Inc., said roughly 800 of the town’s nearly 13,000 properties were reviewed during the survey, which concluded this month. He said his company will now spend about a month comparing the data it independently collected to what is listed on the town roll.
    “We hope to have something in to the Town Board by the end of August,” he said.
    But the results submitted to the Town Board won’t include a recommendation of action for the town to take. Emminger said the study is simply aimed at verifying the accuracy of the data the town has on record.
    “We will make no recommendation to the town,” he said. “What they do is up to them.”
    Instead, Emminger said, the town will receive a report listing the percentage of properties they determined to be accurate and those they consider inaccurate. He said the results will take into consideration a certain degree of errors that are common in a reassessment as large as the one Rotterdam completed in 2007.
    The town is expected to use the study as way to determine if GAR Associates, the Amherst-based private appraisal firm, lived up to its contractual obligations during the town’s revaluation. Town officials allocated $30,000 for the study last month after Assessor Craig Surprise identified a number of inaccuracies in the property tax roll.
    Meanwhile, Surprise said the Board of Assessment Review heard 86 grievances last month. He said 23 property owners either received stipulations or were granted reductions by the board.
    Surprise said many of the usual corporations filed for Article 7 proceedings contesting their assessments. He said these companies included Rite Aid, the Golub Corp. and General Electric.
    This year, the town avoided potential legal proceedings with both Wal-Mart and Macerich Co., the owner of the Rotterdam Square mall, after settling long-standing assessment disputes with each company stipulating that it wouldn’t contest the property values until 2010. The town also avoided possible litigation with the SI Group after signing a 15-year payment in lieu of taxes agreement through the Rotterdam Industrial Development Agency.     

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ROTTERDAM
Barbs traded over property assessments
BY JUSTIN MASON Gazette Reporter

    Disagreements continue to surface over the accuracy of Rotterdam’s property assessments and how errors in the roll may have occurred.
    Tensions over the roll’s accuracy spilled into the public comment period during the Town Board meeting last week, when former councilman Bob Godlewski accused first-year assessor Craig Surprise of unnecessarily lowering property assessments before the grievance period in May, thereby contributing to the drop in Rotterdam’s equalization rate.
    Surprise categorically denied Godlewski’s claims during the board’s agenda meeting Thursday, saying his research on the matter was incomplete, inaccurate and fueled by politics.
    Despite their opposite opinions, both seem to agree on one thing: There are inaccuracies in Rotterdam’s property tax roll. Parts of the roll updated during the 2007 revaluation were reviewed last summer by a private company, which submitted its final report earlier this month to an attorney representing Rotterdam in what Republican Supervisor Steve Tommasone termed a “potentially litigious situation.”
    Godlewski, a Democrat, claims Surprise lowered the assessment on 91 properties, while raising the value on 22 others. He says some of the assessments stipulated during the grievance period in 2007 were also reduced by Surprise in 2008.
    “There were many large reductions in assessments, and a lot of these people who got these reductions went through the process last year,” he said during the meeting last week. “And there appears to be little supporting documentation for these changes.”
    By dropping such a high number of assessments outside the grievance period, Godlewski said, Surprise drove down the town’s equalization rate, thereby unbalancing Rotterdam’s tax distribution. Less than a year after the revaluation, the town’s roll was determined to be 95 percent of full value.
    But Surprise argued he was justified in lowering the assessments because they were uncommonly high in comparison to neighboring properties. In some cases, he said some of the homes he changed were assessed at rates equivalent to similar residential properties with more than 10 times the acreage.
    “You’re trying to promote equity on the roll book,” he said from his office Friday. “You want equity [between properties] whether you’re at 100 percent equalization or at 5 percent equalization.”
    Surprise insisted that the changes he made had no impact on the equalization rate dip. Instead, he said the drop was a factor of properties selling in 2008 for more than they were assessed for in 2007. As evidence, he pointed to the 16 property sales on record in October, nine of which were purchased for more than the 2007 assessed value.
    Surprise said the real problem is that he inherited a roll from former assessor John Macejka Jr. that was riddled with errors before the revaluation and never corrected afterwards. Already, he said, his office has reviewed more than 2,000 properties throughout the town, with a good percentage of them having excluded improvements and sometimes entire homes from the property value.
    “I’ve found so many discrepancies and I have paper work to back it up,” he said. “These are things that had nothing to do with the revaluation company.”
    Macejka, a Democrat who was not reappointed by Tommasone in December, vehemently denied leaving the town with a faulty property tax roll. Though admitting there could be some errors in the data, he said the roll he left in 2007 was in better shape than it ever was before.
    “He inherited a roll that had never been so good,” he said. “That’s the best that roll has been in 40 years. I inherited the mess.”
    Macejka also accused Surprise of catering to Tommasone’s supporters, including his brother’s home in the Country Walk Estates development. He said Dan Tommasone’s Shardon Court home received an $85,000 reduction in assessment in 2008, even after he lowered the home’s value about $52,000 below what he had purchased it for in 2005.
    “Craig is blowing a lot of smoke and trying to get over the issue here,” he said. “What he is doing is trying to curry favor with the people who hired him.”
    Surprise defended his reduction by noting the house was still assessed at a far greater value than others in the neighborhood. He said Macejka’s assessment still hadn’t brought it in line with similar properties in the neighborhood or elsewhere in the town.
    Tommasone bristled at the suggestion his brother’s assessment or any of the other reductions were a quid pro quo for Surprise’s appointment. He said Godlewski’s gripe with the reductions bordered on “slanderous” and seemed politically motivated with the help of Macejka.
    He said the larger issue is the vast number of property errors that Macejka overlooked during his tenure. For instance, he pointed to the hundreds of acres of utility properties that received exemptions they didn’t deserve.
    “You’ll see over time, as the facts come out,” he said Friday. “We’re not talking about smaller arbitrary errors or omissions. These are serious issues that should have been taken care during the revaluation and were not.”

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  Surprise said the real problem is that he inherited a roll from former assessor John Macejka Jr. that was riddled with errors before the revaluation and never corrected afterwards. Already, he said, his office has reviewed more than 2,000 properties throughout the town, with a good percentage of them having excluded improvements and sometimes entire homes from the property value.

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In New York State, the property tax is a local tax, raised and spent locally to finance local governments and public schools. While the State does not collect or receive any direct benefit from the property tax, this tax is still of major importance as the largest single revenue source for the support of municipal and school district services. More than $26 billion is raised in local property taxes across the state annually. (Also see, The Real Property Tax Primer and the 2001 Annual Report)

The New York State Office of Real Property Services (ORPS) is statutorily obligated to administer an equalization program in order to assure equitable property tax allocation among nearly 4,000 taxing jurisdictions in New York State, and to insure the proper allocation of State Aid to Education funds, among other purposes. Equalization seeks to measure the relationship of locally assessed values to an ever-changing real estate market. Each year, ORPS calculates equalization rates for each of the state’s more than 1,200 assessing units.

Why is equalization necessary?
Equalization is necessary in New York State because: (1) there is no fixed percentage at which property must be assessed; (2) not all municipalities assess property at the same percentage of market value; and (3) taxing jurisdictions, such as most school districts, do not share the same taxing boundaries as the cities and towns that are responsible for assessing properties. Most of the state’s more than 700 school districts distribute their taxes among segments of several municipalities, many of which have different levels of assessment. The number of municipal segments in a school district can range from one to fifteen or more.

What is an equalization rate?
At its simplest, an equalization rate is the state’s measure of a municipality's level of assessment (LOA). This is the ratio of total assessed value (AV) to the municipality's total market value (MV). The municipality determines the AV; the MV is estimated by the state. The equalization rate formula is:

Total Assessed Value (AV)  

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  =  Equalization Rate
Total Market Value (MV)  

Equalization rates do not indicate the degree of uniformity among assessments within a municipality. (More information regarding uniformity is available from Fair Assessments - A Guide for Property Owners.)

What does your equalization rate mean?
An equalization rate of 100 means that the municipality is assessing property at 100 percent of market value.
An equalization rate of less than 100 means that the municipality’s total market value is greater than its assessed value.
An equalization rate of greater than 100 means that the total assessed value for the municipality is greater than its total market value.
There would be no need for equalization if all municipalities assessed all property at 100 percent of market value every year.Find the equalization rate for your municipality or school district.

What is the relationship between the State’s equalization rate and the municipality’s level of assessment?
In New York State each municipality is authorized to assess at market value or some fraction of market value. A level of assessment (LOA) of 50 percent means that assessments are at half of market value; an LOA of 100 percent means a community is assessing at 100 percent of market value. Regardless of the LOA chosen by a municipality, all of the assessments in the municipality are required by law to be at a uniform percentage of market value.

Equalization rates are the state’s measure of each municipality's LOA. Each local assessor is required by law to state the municipal LOA on each year’s assessment roll. The state determines the equalization rate by analyzing the locally stated LOA. In accordance with national standards, ORPS reviews the work of the assessor and determines whether the stated LOA is within adequate tolerances to be used as the equalization rate. If certain criteria are met, the LOA becomes the rate. In municipalities where ORPS cannot accept or confirm the LOA, ORPS uses its own independent estimate of total market value to compare to the total assessed value.

What is the benefit of having the locally determined LOA accepted as the equalization rate?
Where assessors are accurately stating the LOA on the tentative assessment roll, they will be indicating the equalization rate upon which school taxes are distributed. When municipalities keep assessments up-to-date each year, they will be adjusting assessed values to reflect market changes, resulting in a consistent LOA and equalization rate from year to year.

What does it mean when your municipality's equalization rate decreases?
A falling equalization rate means that market values are rising faster than assessed values. Keeping assessments up-to-date annually can result in consistent equalization rates each year.

Why do equalization rates need to be established each year?
The Real Property Tax Law requires that annual State equalization rates be established for each county, city, town and village. Equalization rates are calculated each year to reflect that year’s assessment roll and current market values for each assessing unit.

What are equalization rates used for?
Aside from apportionment of taxes among municipal segments of school districts and counties, and distribution of State Aid for Education, some of the less recognized uses of equalization rates include:

establishment of tax and debt limits;
allocation of costs, such as for jointly operated hospitals among participating localities or an injury to a volunteer firefighter, among others;
determination of state assessments (special franchise) or approval of local assessments (state-owned land);
determination of ceilings (railroad and agricultural values) and exemptions;
determination of level of STAR exemptions;
apportionment of sales tax revenues and joint indebtedness; and
as evidence in court proceedings on the issue of assessment inequity and small claims assessment review hearings.
May the equalization rate be used in an assessment appeal?
Yes. Property owners in New York State (except in Nassau County and New York City) may use the equalization rate as one piece of evidence in assessment grievance cases before the Board of Assessment Review and in State Supreme Court. Residential property owners also may use the State equalization rate in assessment cases brought under the provisions of Small Claims Assessment Review. More information on assessment challenges is available in ORPS’s publication entitled "What To Do If You Disagree With Your Assessment".

How do equalization rates relate to school property taxes?
The equalization rate is used to estimate the total market value of an entire taxing jurisdiction and/or segments of jurisdictions. The following formula is used to estimate a municipality’s total market value:

Current Total Assessed Value  

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  =    Total Market Value Estimate (also known as Equalized Full Value)
Current Equalization Rate  

In order for a school district to fairly distribute its property tax levy (the total amount of school taxes to be collected), the levy needs to be divided in proportion to the total market value of each municipal segment. This allows for an equitable distribution of taxes based upon the market value of each municipality or segment.

For example School District AB needs to raise $1 million through property taxes (thus, a levy of $1 million). The district contains all of Town A and all of Town B. Each town has a total assessed value of $10 million. If the $1 million tax levy simply were allocated on the basis of the assessed values, the taxpayers in both towns would evenly split the levy, with each town paying $500,000.

However, through the equalization process, the state determines that that the two towns have different levels of assessment.  Town A has an equalization rate of 33.33 and Town B has an equalization rate of 50.00.



Towns A and B can be compared for the purpose of dividing the $1 million school district tax levy between them:

   Town A
Town B

Assessed Value (AV) of each Town  $10 million $10 million
Equalization Rate of each Town  33.33 50.00
Market Value of each Town  $30 million $20 million
Market Value of School District AB = $50 million  
Percent of Market Value (and, therefore, percent of levy) for each Town  60% 40%
Tax Levy to be raised from each Town  $600,000 $400,000
Tax Rate for each Town (Tax Levy ÷ Assessed Value) x 1000  $60 per $1000 AV $40 per $1000 AV

You can see that Town A is responsible for 60 percent ($30 million ÷ $50 million) of the full value in School District AB, and Town B is responsible for 40 percent ($20 million ÷ $50 million) of the full value. This means that the taxpayers in Town A will have to pay a total of $600,000 (60% of the $1 million tax levy) and those in Town B will have to pay $400,000 (40% of the $1 million tax levy).

It is the change in a town's total market value, as reflected in the equalization rate, relative to the change in the market value of other municipalities in a taxing jurisdiction, such as a school district, that may cause a particular town's share of the tax levy to increase or decrease. If one municipality's market value increases, but all the other municipalities in the taxing jurisdiction increase to a larger degree, then the first municipality's share of the tax levy will decline.

For more information
To learn more about equalization, assessments and other aspects of property tax adminstration, you may wish to talk with your assessor or county director of real property tax services.  More detailed information also is available online.


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NYS Office of Real Property Services
16 Sheridan Avenue
Albany, NY 12210-2714
(51 474-2982

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ROTTERDAM
$30K reval study kept under wraps by Town Board
BY JUSTIN MASON Gazette Reporter
Reach Gazette reporter Justin Mason at 395-3113 or jmason@dailygazette.net.

    Bob Godlewski simply wants a glimpse at the study that cost Rotterdam $30,000 last year.
    Since last fall, the former Town Board member has requested a copy of the consultant’s study that reviewed the work of GAR Associates during the 2007 revaluation. But every time he files a Freedom of Information Law request for the study, the town tells him it’s confi - dential due to a potential lawsuit.
    This position is defended by Paul Goldman, the town’s privately contracted attorney, who said the study conducted by the Buffalobased Emminger, Hyatt, Newton & Pigeon Real Estate Appraisers can’t be released quite yet. He said the town is engaged in discussions with GAR representatives, but the possibility of the town suing the appraiser still exists.
    He acknowledged the town has received several FOIL requests for the study. Each was denied on the basis that it could put the town at a legal disadvantage were the study made public.
    “They were denied because it’s material prepared for litigation and not capable of discovery on a FOIL,” he said.
    But this reason doesn’t sit well with Godlewski, whose October request was rejected in late December. He said the town doesn’t have any right to withhold the document, because it wasn’t produced solely for the purpose of filing a lawsuit.
    “When I filed that FOIL request, the town was not in litigation and they’re still not in litigation,” he said. “It’s statistical data — by law, they have to release it.”
    And Godlewski has the state Committee on Open Government on his side. Executive Director Robert Freeman said the town’s failure to clearly identify the study as a precursor to a lawsuit means it’s a document that cannot legally be withheld from a FOIL request.
    The purpose of the study was to “obtain a statistical analysis to determine the accuracy of the inventory collected and whether [GAR] met all of their contractual obligations, field inspection services and overall analysis of its finding,” according to a resolution unanimously passed by board members in April 2008.
    “This study was clearly not produced solely for litigation,” Freeman said.
    In June, Emminger, Hyatt, Newton & Pigeon began a review of roughly 800 properties among the 13,000 parcels on the town roll. The purpose of the study was to determine the accuracy of information recorded during the revaluation and whether GAR lived up to its obligations to the town, which paid it $752,000 for the work.
    The study of GAR’s work was funded through a $62,935 state subsidy the town received for having a full equalization rate. Town officials were presented with the results in October.
    GAR Vice President Cindy Baire said the company is in discussions with the town, but hasn’t seen the study. She said her company has requested specific instances where it may have erred.
    Godlewski believes the study revealed no abnormalities. He suspects the Town Board squandered money that ..................http://www.dailygazette.net/De.....amp;EntityId=Ar00802