cc:       L.   Daniels, IAAO Executive Director

            W. Trout, IAAO President

            W. Llewellyn, CAE, Past-President

 

 

 

Note:  Please be advised that the format of this report has been adapted for posting on this web site,

           content has not been altered.   

Table of Contents

This analysis by the International Association of Assessing Officers (IAAO), requested by Ms. Elisabeth S. Harding and Mr. Thomas C. Hutton, is for the purpose of providing a review of the assessments and an analysis of the need for improvements or reassessment of property values in the Village of Bronxville, New York. This effort is not undertaken to directly affect their assessment or their share of the real property tax levy, but to evaluate the current status of assessments and assessing practices in the Village of Bronxville in an effort to promote and maintain a viable system for tax equity and fairness for all taxpayers in the Village of Bronxville. 

Our report will acknowledge any strengths or deficiencies in the assessment process and make prospective recommendations.  Our role was limited to evaluating the information attainable through the Village of Bronxville and the Town of Eastchester.  We had no authority to physically recollect property, perform interior inspections, or validate sales or property improvement work done in compliance with or without building permits.  Our analytical conclusions were drawn from statistical analysis performed by a real property tax consultant hired by the Village of Bronxville[1] and other comments are made in a report by second legal consultant hired by the Village of Bronxville[2].  Any recommendations are based on the professional standards for assessment administration published by the IAAO, the professional background and experience of the consultant team involved, and our personal review of the real property, property records, consultant reports and reports to the State Board of Real Property Services, parallel assessment records on these village properties available in the Town of Eastchester, and ascertainable assessment practices in the Village of Bronxville.

 Founded in 1934, the IAAO is a not-for-profit professional membership organization of government officials and others interested in the administration of the property tax.  Currently, the IAAO has an international membership in excess of 7600 individuals. The IAAO is an internationally recognized leader and preeminent source for education, research and innovation in property appraisal, assessment administration, and property tax policy. The IAAO serves the assessment profession by developing the standards, techniques, and procedures used to maintain accurate property values; the research programs to remain preeminent; the education programs to teach others; the programs for professional designation of assessment personnel to recognize excellence; and the technical assistance and research programs for property appraisal, assessment administration, and property tax policy.  Its mission is to promote innovation and excellence in property appraisal, property tax policy and administration through professional development, education, research, and technical assistance.

The IAAO is able to offer specialized consulting and technical advice on a broad range of assessment issues.  For 33 years, the IAAO has provided objective, insightful advice through its technical assistance program to promote excellence in property appraisal, assessment administration and property tax policy. The IAAO developed this consulting service because, as an association of experienced assessment professionals, it could offer the advantages obtainable only through the IAAO such as:

• Technical Expertise — the ability to meet and solve specialized problems
• Objectivity — a fresh, clear, unbiased approach to a complex problem
• Timely Service — a job completed on time, with full-time attention given to the problem
• Persuasion — a frank, impartial voice in developing recommendations
• Dedication to Improving Assessment — working from a tradition of developing industry standards
• Openness — the sharing of vital information, no “trade secrets”
• Resources — a vast body of knowledgeable members and the world’s largest industry library

 Consultants are selected on the basis of their education, experience, contributions to the field, and accomplishments in assessment administration, their areas of competency may be extremely specialized or very broad. Many hold professional appraisal designations. Working in close harmony with clients, IAAO staff members and consultant teams carefully evaluate all components of the assessment issue.  There is no hidden agenda except to improve assessment practices and to present a viable means for resolving controversy.  

Bruce Sauter, the chief analyst and project coordinator for the IAAO, is an internationally renown and professionally designated real property tax expert. He has performed many similar consulting projects on behalf of the IAAO and is uniquely qualified with over 33 years of experience and familiarity with the New York State Real Property Tax Law, rules and regulations and administrative procedures that affect assessing jurisdictions in New York State.  His background and qualifications are further detailed in Appendix A.

Executive summary

 The following are highlights of the more detailed report that follows: 

§               Bronxville assessments represent a significant departure from both good assessment practices as set forth by IAAO Standards for Property Appraisal and Assessment Administration.

 

§               Bronxville assessments violate the standard set forth in the New York State Real Property Tax Law (RPTL § 305) that requires a common level of assessment for all real property within the assessing jurisdiction.

 

§               Given the evidence disclosed in Dr. Eckert’s consulting report for the Village, the assessor is in a highly vulnerable legal position when required to sign the oath under RPTL § 1406 (1) (and by reference RPTL § 505) that the Bronxville Assessment Roll is in full compliance with the New York State Real Property Tax Law.

 

§               Assessment records in the assessment department are incomplete, inaccurate, and in some cases completely missing.  A substantial inventory recollection is required.  Encoding the current inventory data records by transferring the current property record card data and building permit records to a computer system does not solve the data problems based on the deficiency in data quality. 

 

§               The Village should not relinquish its status as an assessing unit and adopt the Town of Eastchester assessment roll at this time.  The last revaluation in the Town of Eastchester was in 1941 and its assessment roll has no better equity than the current Bronxville roll.

 

§               Lack of adequate public access to assessment records is a serious impediment to monitoring assessment equity.  The records by which municipal decisions are made (an essential means by which taxpayers may learn the specific basis of determinations that affect them) are not available or never created in the first instance.  Citizens are deprived of the basic right to know.  Records must be computerized and made more readily accessible without manual access and retrieval by staff.

 

§               The lack of procedures for records retention or disaster recovery continues to leave the Village vulnerable to unexpected data losses and discontinuity in assessment administration.

 

§               Correction of data and assessments on properties limited to parcels with building permits is clearly not an effective solution to assessment disparities.  Many assessment inequities are not attributable to recent building permit activity, but due largely to aged assessments and the changing real property markets over the past 40 years.

 

§               Existing records show no verification of property sales transactions nor indicate the basis for the current assessed value.

 

§               The only constitutionally and statutorily legal means to fix the current situation with the Bronxville assessments is a complete data recollection and revaluation program.  According to several sources, the project could be completed within one calendar year (assuming a Request for Proposals (RFP) is sent before February 1 and a contract for data collection and revaluation is signed by April 1) for under $100 per parcel including property photos, interior inspections, revaluation and a detailed impact study of actual tax shift impacts.  Furthermore, these independent sources confirmed that if the Village maintains the records, assessment updates could be done on an annual basis for less than $20 per parcel.

 

 

Background

The Real Property Tax is an ad valorem tax system.  This means that the tax levy is apportioned among taxpayers based on the value of their real property.  In New York State, all real property is subject to real property taxation unless exempt by law[5]. 

The Real Property Tax Law (RPTL) requires all properties in each municipality (except in New York City and Nassau County) to be assessed at a uniform percentage of market value each year[6].  This means that all taxable properties in the Village of Bronxville should be assessed at market value or at the same uniform percentage of market value each year.  A simple explanation of market value is how much the property would sell for under normal conditions.  Since the value of property is constantly subject to changes in market factors of supply and demand, the market value of property changes continuously.

Real property must be assessed (for village purposes) according to its condition and ownership as of the first day of January[7] (also known as the taxable status date).  In Bronxville, the property that exists as of January 1 must be valued at its market value (or a uniform percentage of its market value) as of the same date (also known as the valuation date).  Each year the Village Assessor must prepare an assessment roll on or before the first day of February in the same manner and form as is required by law for the preparation of a town assessment roll[8] and must subscribe and attach to such roll an oath[9]:

"I, the undersigned, do depose and swear that, to the best of my knowledge and belief, I have set forth in the tentative assessment roll attached hereto or filed herewith all the real property situated in the assessing unit in which I am assessor and, with the exception of assessments made by the state board of real property services, I have estimated the value of such real property at the sums which I have determined to be in accordance with the provisions of section three hundred five of the real property tax  law". 

 

This oath clearly requires the assessor to swear that all real property is included on the assessment roll and assessed at a uniform percentage of the current market value as of January 1 of that year.

 

On or before the eighth day of February, the Village Clerk must cause a notice to be published in the official newspaper of the Village[10].  Such notice must state that the assessor has completed the assessment roll, that a copy of the assessment roll has been filed with the Village Clerk where it may be seen and examined by any person during business hours until the third Tuesday in February and on that day the Board of Review will meet to hear complaints in relation to assessments at a specified time and place.

The assessor is also required to include the uniform percentage for all taxable property on the tentative assessment roll along with the estimate of market value and the assessment for each property.  Since 1998, property tax bills are required to show the assessment and the full market value of each property as well as the uniform percentage that the assessor is applying to all properties to determine the assessment. However, if the property taxes were paid through an escrow account, the taxpayer will receive receipts rather than tax bills and may not receive the aforementioned information.

 In an ad valorem system, everyone pays his or her fair share of taxes as long as every property in a locality is assessed at the same percent of value.  That uniform percentage of market or full value at which properties are assessed is called the Level of Assessment (LOA).  For example, a LOA of 50 percent would indicate that assessments are at half of the market value; whereas, an LOA of 100 percent represents assessing at full market value.  Not only is full market value LOA recommended by the IAAO, but it is the most easily understood level of assessment by taxpayers since they generally have an idea of what their property is worth or can easily compare their property to current sales of similar properties. 

Taxing jurisdictions, such as the Village and School District, are responsible for developing and adopting a budget.  There are several steps involved in this process.  Projected expenditure requirements constitute the projected budget.  Revenues from all sources other than the property tax are determined and subtracted from the budget to arrive at the tax levy (i.e., the total amount to be raised through the property tax).  The tax rate for properties is then determined by dividing the tax levy by the total assessed value of taxable real property (tax levy  /  total assessed value  =  tax rate).  It is critical to understand that assessments merely distribute the tax levy, not increase or decrease the taxes. Assessments may remain the same or even be reduced; yet if the village or school district budgets increase the tax levy (i.e., the total amount that must be raised through the property tax), actual tax bills may be increased.  The assessor does not increase or decrease the taxes to be paid.  The main role of the assessor is to make sure that the assessments are accurate and equitable based on the current market value of the property and the real property tax laws of the State of New York.  This is the key for a fair and equitable distribution of the real property tax levy.

Market value of properties change constantly based on fluctuation in supply and demand.  Individual properties increase or decrease in value at different rates (e.g., different neighborhoods or building styles may be considered more desirable than others).  Keeping assessments up-to-date each year or in tune with these fluctuations in value is necessary for fair distribution based on the property tax standard.  Keeping values up-to-date each year, however, does not necessarily mean that the assessment will increase.  Market values of individual properties may stay the same or go down, which means that some properties may see a decrease in assessed values while others may stay the same or increase. 

Even if the assessment does increase, it doesn’t mean that the taxes will automatically increase.  A municipality may change from a fractional level of assessment to 100 percent (i.e., full market value).  If the original level of assessment was 50 percent, and the current level of assessment is 100 percent, the assessed value could go from $450,000 to $900,000, and yet if all other taxpayers had similar increases there would not be any increase in taxes.[11]  In other cases, such as a village-wide revaluation of property that has not been reassessed for many years, almost all property would be likely to see an increase in assessed value because property values have increased over that period of time.  However, if a particular property assessment increased in value less than the average percentage increase in assessment of other property in the municipality, the taxpayer would actually experience a tax share decrease.  If the school budget and village budget remained the same as the prior year, the effective tax share decrease would translate to an actual decrease in taxes despite the assessment increase!  As an example, if a taxpayer’s assessment increased by 30 percent, but most other property owners saw increases of 45 percent, the taxpayer would likely see a decrease in taxes.[12]

In order to maintain a uniform LOA, each year the assessor must analyze the current market values of all real property in the village and decide if the assessments (that exist from the prior assessment roll) continue to reflect the new current market value.   If the assessments do not reflect a uniform percentage of current market value, the assessor must determine which properties require change and by how much.  If the real estate market has been fairly stable and assessments have been kept up-to-date annually, very few assessments may need to be adjusted.

Market values may have changed in one neighborhood (or for a particular type of property) more than for other neighborhoods (or other types of property).  However, properties within that neighborhood (or that particular type of property) may remain at a uniform level of assessment albeit higher or lower than other property in the municipality.  Assessments within that neighborhood (or particular type of property) may be easily updated to bring them in line with the uniform percentage of value for all other property in the jurisdiction by applying market adjustment trends to those properties. 

 

When new construction, demolition, or other changes occur that would affect the market value of individual properties, the assessor should conduct a physical reinspection and reappraise the property, if necessary.   Based upon that revised property information, the assessor must re-estimate the market value of the property.  Because the property information is used to determine the assessment, it is in the best interest of taxpayers to make sure that the assessor’s data is correct for their property.  Taxpayers should attempt to arrange for an informal conference to review the information on which the value was based. If the assessor feels that a mistake was made and there is reason to question the accuracy of the assessment, an adjustment to the assessment should be made. When the assessor is convinced that all the property assessments are as accurate and uniform as possible given all the information available, the assessments will be placed on the tentative assessment roll.[13]

While the roll is tentative, the taxpayer still has the ability to meet informally with the assessor about their assessment.  Subsequent to any such meeting, if the taxpayer still feels that he is inequitably assessed based upon the market value of his home, he has the right to file for formal review of his assessment.  The assessment appeals process includes appeals to the Board of Assessment Review (BAR) and for certain residential property a Small Claims Assessment Review (SCAR) process before a more extensive Article 7 tax certiorari proceeding.  The required application deadlines and instructions, can be found in the publication “How to File for a Review of Your Assessment – A Guide for Property Owners” written and updated by the New York State Office of Real Property Services.

More than 250 municipalities across New York annually benefit from consistent current market value assessments.  The benefits include: 

Current Situation In Bronxville

Not only is the Village of Bronxville among the dwindling number of village assessing units in New York State[14], but it is one of only two village assessing units in New York where both Village and School taxes are levied based on the Village assessment roll[15].  With increasing budgets, school taxes currently comprise approximately 83%[16] of the Village tax bill.  The inequity in assessments on the Village roll, which apportions the distribution of the Village and School tax levies, has become a center of controversy in Bronxville.  Mr. Wilkes states in his report to the Village Board, “… it is clear that the inequities in taxation are disfavored, if not illegal, and the passage of time gradually worsens the situation.”[17] 

 

The Cole-Layer-Trumble Company (CLT), which is now a Division of Tyler Technologies, Inc., conducted the last complete revaluation of all property in the Village of Bronxville nearly 40 years ago, in 1967.  Assessments have not been maintained at market value since that time.  The average level of assessment in relationship to current market value as indicated by the State equalization rate for the Village assessment roll, has dropped to 3.66% in 2005.  This would indicate an average annual increase in market value over the past 39 years of slightly more than 8⅓ percent per year.[18]  The level of assessment has decreased over 51% in the past 7 years alone from 7.47% to 3.66%[19]. 

 

Dr. Joseph Eckert, in the executive summary of his consulting report “Assessment Practices and Effective Tax Rate Variations in Bronxville” (September 8, 2005), indicated:

“… Bronxville assessment[s] represent a significant departure from both good assessment practices and the standard in law that requires a common assessment ratio for real property.  The Village should … examine strategies for bringing effective tax rates in line with the standard articulated in the New York State Real Property Tax Law.”[20] 

The lack of uniformity within the residential property class is exemplified by his analysis of the effective tax rates on residential properties that have recently sold in the Village.  The effective tax rate is the ratio of property taxes paid to the market value of the property.  In an equitable ad valorem tax system, every taxpayer should have nearly identical effective tax rates.  Dr. Eckert’s analysis showed that effective tax rates on the residential properties studied varied from 0.9% to 6.9%.[21]  As Dr. Eckert indicates, for a property of equivalent market value some taxpayers are paying effectively 7.5 times as much as another taxpayer in the village!  This means that on two residential properties in Bronxville that each have a current market value of $1,000,000 (not unusual in Bronxville), one resident may pay $9,000 in taxes while the other is paying $60,000 more or $69,000 in taxes on a property of equal market value! 

 

The 2005 Village assessment roll indicates the lack of analysis and attention paid to maintaining equitable assessments.  On the entire Village of Bronxville, only 7 residential parcels had an increase in assessment from the 2004 Assessment Roll.  Of those 7 parcels, 4 were townhouses that were damaged by fire in 2002 and recently rebuilt and 2 parcels were increased because they lost their tax exemption status.

Furthermore, there is evidence not cited by either consultant to the Village of lack of uniformity among classes.  The residential assessment ratio (RAR)[22] is below the equalization rate[23] (i.e., the Village RAR for 2005 was 3.03% and the Village equalization rate for 2005 was 3.66%).  The residential assessment ratio is established for the Village using the same basic procedures as those for cities and towns. However, if the assessment from the latest Village final roll at sale date is different from the town assessment reported on the sales transfer reporting form (RP-5217), the Village assessor is responsible for supplying the correct Village assessment on all arm's length residential sales within the Village for Residential Assessment Ratio purposes.  We could not confirm whether or not the former assessor, Mr. Balog, provided that information to ORPS.  Assuming that the assessment information was provided to ORPS and the total taxable assessed value of the residential property in the Village is more than twice the total taxable assessed value of all non-residential property in the Village[24] that would indicate the non- residential property was assessed at nearly a 50% higher level of assessment than the average residential property.  This along with Eckert’s study shows inequity both within the residential class and between the residential and non-residential property classes. 

RECORDS STATUS

 DATA QUALITY

 It is virtually impossible to correct the problem of inequity without current, accurate data.  Mr. Wilkes noted in his report, if a municipality “… has not revalued in nearly 40 years, the dispersion is due largely to aged assessments and a changing property market….”[25]

 

Mayor, Mary C. Marvin, speaking in response to public comment at the November 14, 2005, Village Board meeting, acknowledged considerable deficiencies in the assessment records and stated that assigning blame for past practices does not rectify the equity problem.  Without attribution, it was openly acknowledged that the records in the assessment department were incomplete, inaccurate, and in some cases completely missing.  While Mayor Marvin indicated that in the short term steps were underway to improve these records, a substantial recollection of property inventory is obviously required. 

 

The current appointed assessor, Mr. Iagallo, at the same meeting (November 14, 2005) of the Village Board, handed out copies and cited RPTL Section 500 (1), “… each year, the assessor … shall complete an inventory of all real property …”, as his directive to collect the data on building permits.  While Mr. Iagallo is correct that he should be observant of the property data changes on building permits, limiting the correction of data on property inventories to those parcels with building permits is clearly not an effective solution to assessment disparities.  Many issues arise from inventory differences that are not attributable to recent building permit activity and many assessment inequities are due largely to aged assessments and the changing real property markets over the past 40 years.  It should be noted that the Real Property Tax Law requires the assessor to make available for public review the assessment inventory and valuation data[26].  Personal inspection revealed that many property data record cards do not have current inventory information or recent photographs of the property.  Some cards show building sketches whose dimensions are incorrect (one side of a structure does not match the opposite side), sales dates without any indication of the sale price, no notes on sales or building permit verification or valuation decisions, no clear standard living area calculations or total related to the building sketch, no inventory adjustments apparent in the past ten years for renovations and no current assessed values.  There is virtually no possibility that current assessments could be fairly and equitably determined on the basis of the property records.  There is also a strong indication based on requests made and documents supplied that some property records are missing or lost.

 

ACCESS TO INFORMATION

 Public access to assessment information is essential to monitor the equity (or inequity) of any taxpayer’s assessment.  On multiple occasions, members of the IAAO attempted to review the current status of the property data records in the Village offices. Village staff verbally acknowledged that there was no clear policy in place on access to these records.  We were not permitted to visually inspect more than one or two property record cards without a formal “freedom of information” request, a serious impediment to monitoring assessment equity.  Lack of access might be attributed to lack of records, improper or inadequate record keeping, or general reluctance to disclose records with significant deficiencies.  Since less than a dozen records were requested for a visual inspection only (no copies were requested), staff limitations must be discounted as the reason for not producing the records. Furthermore, at the time of our on-site requests, no other public records access of any kind was being requested.  Direct observations of the Village assessment records showed: incorrect building styles, conditions, measurements; missing substantial improvements or building additions, sale dates without any indication of the sale price, incorrect, and in some cases missing or improper property identifications, and several other omissions.

 Access to, and retrieval of, assessment records could be greatly enhanced by computerized records.  The increased efficiencies, valuation and assessment analysis capabilities, along with the enhanced responsiveness to assessment information requests more than offsets the costs of acquiring the necessary computer hardware and software.  Encoding the current inventory data records, however, is not advisable based on the previously indicated deficiency in data quality. 

 

SALES AND BUILDING PERMITS

 It is difficult to be completely certain based on the limited data made available (inspection of records and cross reference to reports made to the State Office of Real Property Services), but it appears that few if any changes have been made to inventories or property assessments even for properties with substantial building improvements and building permit work done over the past 4 to 6 years.  Assessment changes that were made exhibited no clear pattern or equitable basis for adjustment.  Village assessment for 10 Kraft Avenue, completely rebuilt after a fire, was adjusted up on the 2004 assessment roll and then adjusted down on the 2005 assessment roll!  However, many other substantial improvements shown below reflected little of no change in assessments.  Of the approximately 1300 building permits filed in the Village from 1996 to 2003, the Village assessor changed only 37 assessments over that entire period of time (and very few in recent years), which is nearly 600 less than the Town assessor made during that period on the same properties!  Typically at least half of the building permits issued would be for significant improvements that substantially increase the property’s market value.  This acknowledges that a number of permits are required for repairs or replacement of “short-life” items such as heating and air conditioning system, water heaters, or repairs that maintain value, but do not substantially increase the property’s market value (especially when no reduction in value was given for the depreciated assets.  The following chart shows details of several substantial improvements most of which were not acknowledged through any change in their assessed values.

*  Village staff could not find the Property Record Card for this property (28 Greenfield Road).

 AUDIT TRAIL ON VALUE CHANGES

 Existing records show no verification of property sales transactions nor indicate the basis for the current assessed value.  Furthermore, where substantial reductions in the assessment of certain commercial property were made, no records or explanations exist.  Dr. Eckert confirmed similar findings in his report stating that the former assessor, Robert Balog, made general conclusions that were not based on any real market analysis and declined to add the [market contribution] cost of significant home improvements and presented little evidence for his decisions[27].  Maintaining such information is critical to the valuation explanation and value defensibility.  No notes or audit trail on building permit analysis, sales verification or valuation decisions is currently available in the Village assessment office. 

SECURITY AND BACKUP

Assessment data records that currently exist, vestiges of the prior 1967 revaluation, are on paper property record cards in filling cabinets in the Village offices.  No off-site copies or records retention facilities appear to exist.  Although the current data is of questionable quality and completeness, no procedures are currently in place for business continuity or disaster recovery.  Based on the records available, any assessor would be hard pressed to justify the current assessments and share the information with Village taxpayers[28]. 

If any computer readable data files ever existed, they were in the possession of the former assessor somewhere off-site and were not returned to the Village as confirmed by the Village Administrator, Harry Porr.  While computerized data management of assessment records was relatively new in 1967, today nearly all assessment jurisdictions maintain computerized assessment data records.  The lack of any recoverable data files in support of the assessments indicates that procedures for records retention or disaster recovery of the critical assessment records either don’t exists or are obviously not followed.  The lack of effective procedures continues to leave the Village vulnerable to unexpected disasters or discontinuity in administration as evidenced by the recent change in assessors.

STATUS OF ASSESSMENTs

The residential assessments show significant inequities among property owners.  Effective tax rates vary in the sales sample studied by Dr. Eckert[29] from a low of .9% to a high of 6.9%[30].  When one effective tax rate is over 7½ times another, gross inequity and lack of uniformity exist.  Effective tax rates based on actual sale prices as market value indicates should not vary by more than normal market variances.  Thus, residential effective tax rates on arms-length transactions should rarely exceed 20 percent variance, never 750%!  Dr. Eckert’s charts indicate a wide variance among the effective tax rates of many properties of similar market value[31]. The Eckert report did not analyze cooperative, condominium or any non-residential properties. 

Measures of central tendency and dispersion provide a way to understand the distribution of data and infer conclusions.  Inferential statistics are commonly used when it is too expensive or impossible to acquire the measurement in the entire data set.  The coefficient of variation (COV) and coefficient of dispersion (COD) are inferential statistics that indicate a measure of the uniformity or variance[32] of a larger set of data from a subset of that data.  The coefficient of dispersion (COD) is the average absolute percent deviation of ratios from the median (or middle) ratio[33].  The COD has an advantage over the COV, because the COD does not depend on the assumption that ratios are normally distributed.  When the sample is not normally distributed, parametric statistics such as the mean and COV are biased by highly abnormal ratios, commonly referred to as “outliers”, and are not good indicators of the central tendency or variance.

In this case, Eckert’s study of 350 effective tax rates develops an inferential statistical conclusion about the variance among all residential property effective tax rates in the Village of Bronxville, which would be impossible to know without a complete revaluation of all property in the Village.  In the Eckert study, the coefficients of dispersion (COD) on the effective tax rates of the sales range from a low of 14.99% to 24.21% (median COD of 19.21%).  Professional performance standards for level of assessment ratios (or effective tax rates) on property similar to those in Bronxville should be less than 15%[34].

Eckert also provides another statistic about the variance of effective tax rates relative to the value of the property.  This statistic is known as the Price Related Differential (PRD) or index of vertical inequity.  For assessment purposes, any PRD between .98 and 1.03 is considered equitable, meaning that lower valued homes are taxed at approximately the same level of assessment as higher valued homes.  A PRD below .98 is considered “progressive” because it indicates that higher valued homes are valued at a higher level of assessment than lower valued homes.  A PRD above 1.03 is considered “regressive” because it indicates that higher valued homes are valued at a lower level of assessment than lower valued homes.  Eckert’s study shows that the PRD of the effective tax rates in Bronxville (and thus assessments) over the 9 years studied range from 1.02 to 1.16 with 8 of 9 years over 1.03 and a median PRD of 1.10[35].

 

Village Consultants’ Reports

 

ECKERT REPORT

 Joseph K. Eckert, Ph. D., Property Tax Practice Director for BearingPoint Inc., was retained by the Village of Bronxville Board to evaluate the equity and fairness of the residential assessment roll for the Village of Bronxville as a preliminary step to aid the Board in determining what action may need to be taken to improve the assessment roll.  His report focused on assessment equity solely within the residential class of properties in the Village with additional significant comments regarding the former assessor Robert Balog’s records and practices and the tax assessment work done in conjunction with building permits and new construction. 

 HIGHLIGHTS FROM ECKERT REPORT WITH COMMENTS

 

1)      Effective tax rates in the sample studied (i.e., 305 residential (non-condominium) sales totally within the village between 1996 and 2004 all identified as “arms-length” transactions by the former assessor) ranged from a low of .9% to a high of 6.9%.[36]

 

Comment:  While the Eckert report did not analyze cooperative, condominium or any non-residential properties, his analysis reflects the vast majority of properties in the Village of Bronxville.  A dispersion in effective tax rates where one is over 7½ times another reflects gross inequity and lack of uniformity. 

 

2)      Coefficients of Dispersion from 1996 through 2004 range from a low of 14.99% to 24.21% (median COD of 19.21%)[37] and in a second sample from a low of 16.69% to 28.93% (median COD of 18.90%)[38].  Price Related Differentials range from 1.02 to 1.16 (median PRD of 1.10)[39] and in the second sample from a low of 1.03 to 1.17 (median PRD of 1.09)[40].

 

Comment:  Since the sales sample is not normally distributed, the coefficient of dispersion is the appropriate non-parametric statistic to measure dispersion.  CODs above 15%, which essentially occurred in all years based on the Village assessment roll, are clearly beyond the professional standards for good assessment practices.[41]  Price Related Differentials (PRD) (i.e., the mean ratio divided by the weighted mean ratio) is subject to outlier influence.  Although this is not an issue in the 9 years observed, with 8 of 9 years over 1.03, this index of vertical inequity indicates a clear assessment regressivity bias.  This means that given uniform Village and School tax rates, higher valued homes in the Village are assessed at a lower level of assessment than lower priced homes.

3)      “… a very strong revaluation program could cut the COD to around 5%.  This would reduce these effective tax rate variations by three-fourths [75%] of the current variations…”[42]

 

Comment:  Representative assessment ratios below 5% are virtually unachievable (except in exceptional highly unusual, homogeneous neighborhoods such as Levittown in Nassau County, New York).  Assessment ratios below 5% are suspect and usually indicative of a non-representative sample or selective reappraisal commonly known as “sales chasing”[43].  Sales chasing is the practice of using the sale of a property to trigger a reassessment of the property at or near the selling price.  Sales chasing invalidates the uniformity statistics derived from a sales ratio study and indicates a false level of assessment for similar unsold properties.  Although theoretically possible, it is highly unlikely that a strong reassessment would produce a COD of 5% in the initial year.  A more realistic expectation of a very good revaluation would be a coefficient of dispersion below 10%.  However, if true market value were precisely measurable (not using the sale price surrogate), the dispersion in effective tax rates could theoretically be close to 5%.

 

4)      Eckert notes that former assessor, “… Mr. Balog’s reports provided relatively little of the information requested…no real estimate of the market value of the property…no real evidence of the comparable values in the neighborhood…little information on the nature of the permit-related work or his evaluation of it…[and he made] general conclusions that were not based on any real market analyses…In some cases where there appeared to be significant home improvements … he declined to add the cost of the improvement to the assessment and presented little evidence for the decision.”[44]

 

Comment:  This speaks to changes required in assessment record keeping and assessment administration procedures.  Computerized records should be kept because they are clearly: more readily accessible for public information and value defense; easily edited and analyzed to determine current market value, change in inventory, eligibility for exemptions; and effectively backed up and secured off-site.  Assessment records in the Town of Eastchester (for Village properties) are clearly more accessible (although scanned and not fully computerized) and site visitations and decision-making by the assessor and assessment staff are well documented.  Backup and recovery procedures should be developed and coordinated with other vital records in the Village.

 

RECOMMENDATIONS ON PERMIT WORK WITH COMMENTS

 

1)      “Develop mass appraisal models using Computer Assisted Mass Appraisal methods (CAMA) that could be used on an as needed basis to estimate the market value of properties with permit work.  This value then could be compared with neighborhood property value levels to initially determine if the neighborhood level could support the permit work being added to the assessed value.  This tool would eliminate the need to use a transformation of the flawed current assessment to estimate the market value of the property.”[45]

 

Comment:  The recommendation to use Computer Assisted Mass Appraisal methods to estimate the market value of building-permit work is a good suggestion, because it calibrates the permit costs to the market value contribution.  However, the use of Computer Assisted Mass Appraisal methods should not be limited to properties with building-permit work.  Many of the inequities that exist currently on the Village assessment roll involve properties that have not had any recent building-permit work. 

 

Adjustments to assessed values should not be limited to equity within a neighborhood, but should be based on the uniformity of assessments among all properties in the Village.  If the building-permit work affects the property’s current market value such that it changes the property’s level of assessment to any ratio other than the uniform level of assessment of all other property in the Village, then an adjustment to the assessment should be made. 

 

The use of a transformation of the flawed current assessment should not be used to determine any estimates of current market value since there is no uniformity between the current assessments and current market value.  This is true for any property on the assessment roll, not just permit work properties.

 

2)      Develop a Village-wide Geographic Information System (GIS) that would display comparative real estate information on electronic maps.  This capacity, in concert with the CAMA capacity … would be used to estimate the market value of the permit property …[46]

 

Comment:  Geographic Information Systems (GIS) are database management systems used to store, retrieve, manipulate, analyze, and display spatial (land or geographically-based) information.  This is a good suggestion, but should not be limited to permit work as discussed above.  I would strongly suggest the Environmental Systems Research Institute’s (ESRI) GIS software Arc/Info and their affiliated product lines as a commonly accepted industry standard and the highest quality, most useful software currently available.  PC Arcview is an inexpensive system where geographically related information is easy to store, retrieve, manipulate, analyze, and communicate results.  Their software is compatible with many different standard data import and export formats.

 

3)      Develop a regression-based capitalization study … that would guide the assessor on what capitalization rate to use for different types of permit work for different types of property in different locations. [47]

 

Comment:  While this recommendation has several deficiencies, it is far better than current methods.  The method Eckert used and advocates capitalizes permit costs. Permit costs are generally estimates that may or may not relate to actual costs for building permit work done.  They may include partial or total labor and material labor costs.    The building permit costs seldom distinguish the extent of the contribution of the permit work to the market value of the property as compared to the maintenance or personal preference to the owner’s needs.  The method also used the assessed value as a proxy for location and other physical characteristics that were not available or measured.  As clearly identified throughout Dr. Eckert’s study, the inequity among the assessed values indicates no consistent relationship with the property location or physical characteristics.  While the assumption of the correlation is appropriate in normal circumstances, it can lead to misleading implications of permit contributions based upon deficiencies in the assessed values.  Eckert does acknowledge that, “… this model could be refined by actually collecting the information on the land and physical [improvement] characteristics on each sale.”[48]

 

RECOMMENDATIONS ON Assessment Administration WITH COMMENTS

 

1)      Commission an impact study that would examine in more detail the patterns of effective tax rate variations by property type and location, and examine in detail the shifts in tax burden that would result if the Village decided to conduct a revaluation.[49]

 

Comment:  Impact studies are an excellent recommendation, however, they should be based on complete and accurate, representative data.  The ideal scenario would be to conduct such an analysis after a complete data recollection with on-site collection including interior inspection.  Premature impact studies could indicate false conclusions and misdirect well-intended public information programs or efforts to mitigate any critically severe impacts.  The time and money spent on an impact study should follow a complete data recollection that would still provide adequate time prior to any potential reassessment to prepare public information programs and consider mitigating any unforeseen, severe tax shifts.

 

2)      Develop a Property Tax Information Management System (PTIMS) that would contain all related real estate data identified by a geo-coded property record number.  This system would contain title information, sales information on sold properties (as of the time of sale), property characteristics for all real properties, and billing and collection information in a single integrated database.[50]

 

Comment:  This is an excellent suggestion.  Systems and features available could be easily researched with a request for information (RFI) or a request for proposals (RFP).  The State Office of Real Property Services also develops and maintains the NYS Real Property System (RPS) that attempts to maintain full compliance with all NYS Real Property Tax Law statutes and any Rules and Regulations promulgated in support of the RPTL at very low cost.  There are many training opportunities for users of this system since over 90% of the assessing jurisdictions in New York State use the system.  It also provides standard data collection definitions for improved sharing of market data across municipal boundaries.  Notwithstanding the aforementioned benefits, many other systems offer exceptional features that may be desirable as well.

 

3)      Begin a data collection program that would inspect and collect the features of all real property in the Village and enter the data in the PTIMS.[51]

 

Comment:  This is fundamentally the most critical recommendation.  An RFP for such collection with a possible option or in conjunction with a revaluation should be issued no later than February 15, 2006.  Attached, in Appendix C, is a thorough, detailed Request for Proposals used by many municipalities in New York State that could be of assistance in guaranteeing the greatest possible success in obtaining a quality reassessment. 

WILKES REPORT

David C. Wilkes, a partner in Huff Wilkes LLP, which was retained by the Village of Bronxville Board to advise the Village Board concerning real property tax issues was further asked to advise the Village Board of its legal options in the event that expert analysis might indicate that corrective action should, or could, be taken. 

Some of the highlights of the Wilkes report follow with comments: 

      LEGAL STATEMENTS IN THE WILKES REPORT WITH COMMENTS 

1)      “New York State law … does not mandate the performance of a revaluation at any time, much less on a specified periodic basis.”[52] 

Comment:  While New York State law does not mandate the performance of a “revaluation”, RPTL § 305 requires that all assessments each year must be at a uniform percentage of market value [emphasis added].  Since the market values for various properties are changing constantly, a systematic analysis of all property should be done annually to ascertain that assessments are uniform.  If not, then the assessor must adjust certain assessments up or down to maintain assessment uniformity.  Failure to do so would make the assessor in violation of the oath taken under RPTL § 1406 (1) (and by reference RPTL § 500) and vulnerable to court challenges to the equity and fairness required by the Constitution of the United States and New York State and challenges under Article 7 or Article 78 proceedings.

 

2)      “In a community that does not regularly perform revaluations, the addition of assessment to a given property is principally restricted to instances of property modifications that enhance the value of the property.  The extent of such reassessments is also limited, according to case law, to the value of the improvements.  The assessor may legally increase the existing assessment, but only to a maximum of the improvement value, …”[53]

 

Comment:  Mr. Wilkes misunderstands the difference between revaluations and reassessments.  Annually, if the assessor analyzes current market values of all properties and decides that certain properties are under or over assessed relative to the uniform level of assessment for all other properties in the village, he or she not only may increase or decrease the assessment for a property (with or without an improvement), but is duty bound to do so.  Assessment to a given property is not restricted to instances of property modifications nor are they restricted to enhancements of the value of the property.  As an example, a property with highly desirable lake frontage may increase significantly in market value beyond the typical increase in market value for the overall community regardless of any property improvements.  The necessity to maintain uniform assessments would require that the assessment on that property increase to keep it in line with the current level of assessment of all other property in the community.  Another residence may have been damaged by storms significantly more than other property in the Village.  Without an adjustment to the property assessment, the storm-damaged property would have an assessment to market value ratio higher than other property in the Village.  In this case, the assessment should be reduced. 

 

Another common example is known as “flipping property”, where a buyer acquires property with the idea of fixing it up at minimal cost and reselling the property in the open market for a significant profit.  This practice is founded on the principle that an improvement to the existing structure would increase the property’s market value in excess of the cost to make the improvement and any short-term holding costs to generate a profit.  The concept of cost and value should not be confused. 

 

To understand Mr. Wilkes’s report, that, “The assessor may legally increase the existing assessment, but only to the maximum value of the improvement value …”[54] must be interpreted to mean the assessment (if at 100% of current market value is the uniform level of assessment being maintained) can be increased to the full contribution of the improvement to the market value change to the property.  Any assessments must consider the value of the improvement to the property’s market value at the uniform percentage of value.  If the Village assessments were at a uniform percentage of value far less than 100%, say 3.66% (the Village 2005 equalization rate) as allowed by RPTL § 305, then the assessment could only be increased by 3.66% of the market value increase derived from the improvement.  Court decisions based on the “cost” of the improvement” are dated concepts in modern appraisal practices.  The assessment of any improvement’s market value contribution is limited to the uniform percentage of market value of the community.

 

3)      “The assessor’s statutory obligation is to make an ‘inventory’ of all [emphasis added] the real property in the jurisdiction (see RPTL § 500 (1)), but New York statutes provide little additional guidance, and certainly no standard that usefully distinguishes among specific types of home improvements.”[55]

 

Comment:  RPTL § 500 (1) requires the assessor to acquire and maintain an inventory of all property in the jurisdiction, not just the building permits.

 

4)      “A high COD means that there may be too much randomness in the assessment roll, perhaps to the point at which there may be little or no correlation between a given home value and its assessment, and thus violative [sic] of the “rough equity” requirement in [Allied Stores of Ohio v. Bowers 358 U.S. 522, 526-527 (1959)] Bowers. … The Bronxville assessment roll contains a fair degree of randomness.  … The Bronxville assessment roll, from the standpoint of assessment best practices (though not a matter of law, as discussed below), requires significant reform if a sufficient level of fairness is to be achieved.”[56]

 

Comment:  With this statement in the Wilkes report and the statistical analysis evidence from the Eckert report, both consultants advise the Village of the significant non-uniformity in assessments.  Given these reports, it would be impossible for the assessor to sign the oath under RPTL § 1406 (1) (and by reference RPTL § 500) with the next tentative assessment roll on February 1, 2006 without the personal liability of signing a false statement or without making substantial changes to assessments on that roll to rectify the assessment inequities. 

 

      NON-LEGAL STATEMENTS IN THE WILKES REPORT WITH COMMENTS

 

1)      “Revaluations are … considered politically risky and costly endeavors that in many instances have caused, in the perception of some, devastating consequences for those in the community who may be most vulnerable to spiking taxes, particularly senior citizens.”[57]

 

Comment:  This is a personal opinion made by Mr. Wilkes and acknowledged as such at the Village Meeting where he and Dr. Eckert presented their reports and responded to questions.  His comments about “devastating consequences”, “costly”, and “politically risky” are unsubstantiated.

 

·         Lack of a revaluation in the face of evidence of inequities could be considered politically risky.  The failure to take action could be considered politically risky.  Taking a stand to champion fairness and equity in property taxation by analyzing the current situation and enabling the steps necessary to achieve a fair and equitable tax roll should be strongly supported by the vast majority of village residents.  Only those who are financially benefiting by currently paying far less than their fair share of property taxes or those who have no interest in fairness or equity would politically oppose such an effort.

 

·         The cost of the revaluation is not a substantive issue.  The Village Board has cautiously approached the assessment issue with authorized appropriations close to $100,000 expended in studying the issue to date[58].  The estimated cost of a complete property recollection including on-site measurements, interior inspections, building sketches and a digital photograph of every property as well as encoding the data into computer readable format, revaluation and field review of all property, a comprehensive public relations program, and tax shift analysis reports could be provided by experienced mass appraisal contractors for approximately $80 to $100 per parcel or less (confirmed by no less than five separate independent estimates from mass appraisal firms and assessment experts with recent reappraisal experience in the lower Hudson Valley, New York City and Long Island, Connecticut, Pennsylvania or New Jersey).  For an estimated 1600 parcels in the Village of Bronxville, all felt that the project could be done in less than one year (data collection through complete revaluation and assessment disclosure) for less than $150,000.

 

·         There is no supporting information that senior citizens would be the most devastated by tax shifts brought about by a revaluation that brings equity to the Village tax roll in Bronxville.  Furthermore, the Eckert study indicated high price related differentials, which would indicate that higher priced homes are more likely to be the properties that are most under assessed and therefore might get an increase in tax shares after a revaluation.  If we equate property wealth with ability to pay the property taxes, those who are most able to pay, regardless of age, are paying less than their fair share of the real property taxes.  Only those who want to protect their current inequitably low taxes would oppose a revaluation.

 

In a particular scenario, if a senior citizen with limited income were affected by a tax share increase, “safety valves” are available.  First, there is the Senior Citizen Exemption as mentioned at the November Village Board meeting (deadline for applications is December 31).   New York State Real Property Tax Law § 467 gives local governments and public school districts the option of granting a reduction on the amount of property taxes paid by qualifying senior citizens by reducing the taxable assessed value of residential property owned by these seniors by as much as 50%. To qualify, seniors generally must be 65 years of age or older and meet certain income limitations and other requirements. For the 50% exemption, the law would allow the Village and/or the School district to set the maximum income limit at any figure between $3,000 and $24,000.  Localities have the further option of giving exemptions of less than 50%, called the “sliding-scale” option, to seniors whose incomes are more than $24,000 up to a yearly income as high as $32,399.99.  These individuals could get a reduced exemption from 50% down to 5% for an income just under $32,400.

 

As previously mentioned, since the effective tax rate on an equalized Village assessment roll would probably be approximately 3% of the market value of the property, many banks would consider a “reverse mortgage” that would provide cash to pay taxes or other bills in exchange for a share of the property ownership or mortgage.  When the property owner sells the property or upon death of the property owner and settlement of the estate, the bank would receive its payment.  This could easily fund taxes for more than 25 years, if necessary.

 

While not isolated to an individual taxpayer, there is also another option available to help residential taxpayers.  After a revaluation, if tax shares shift because of an interclass redistribution from non-residential properties into the residential property class, the Village could consider the Homestead Tax Option under Article 19 of the RPTL.  This would isolate the redistribution of assessments to within the residential class and redistribution within the non-residential class.  However, with the majority of the assessed value in the residential portion of the assessment roll, which has considerable inequity (see Eckert report), the Homestead Tax Option (RPTL Article 19) has several disadvantages and should not be considered the panacea to the problem and adopted as a “knee jerk” reaction.

 

2)      “… the so-called ‘welcome stranger’ scenario, in which the true market value of a given property comes to the attention of an assessor based upon an arms length sale of an existing property at which no improvements have been made.  In such an instance, the assessor has been provided with “perfect” evidence of the property’s market value …”[59]

 

Comment:  Although a sale price is evidence of market value, market value is not [emphasis added] the same as price.[60] Value and price are not synonymous.[61] A sale price is the agreement between only one buyer and one seller for the exchange of the property ownership as of a specific date under their personal interests and situations of need or duress.  Since real estate valuation is an inexact science, any individual sale is highly unlikely to indicate the exact true market value.  Market value is inherently a simple concept … created by the collective patterns of the market.[62]  When forces of supply and demand are out of equilibrium, sale price can and does differ significantly from market value.[63]  Only through the examination of many sales can a professional appraiser or assessor determine “the most probable price, expressed in terms of money, that a property would bring in a competitive and open market under all conditions requisite for a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus”[64] (i.e., market value).  The lack of any variance between a sale price and an assessed value (assumed to be or adjusted to market value) does not indicate that the assessment is at market value.  On the contrary, it is rarely a “perfect” indication of true market value. 

 

“Welcome stranger”, is often synonymous with “sales chasing”.  This unprofessional assessment practice is when the assessed value of sold properties are updated at or close to their sale price to reflect a higher level of assessment yet little or no adjustment occurs on other unsold properties.  This selective reappraisal is intended to maintain an apparently high level of assessment with a low coefficient of dispersion in a sales ratio study.  However, such a practice would invalidate the use of the sales ratio study to determine the level or uniformity of assessments.

 

3)      “In fact, many assessors do restrict themselves to taking reassessment action only upon the issuance of a building permit, even though they may become aware of improvement activity through other means …”[65]

 

Comment:  Change in any real property brought to the attention of, or known by the assessor, should be analyzed and considered when determining the assessments annually.  No restriction should be made based on the source of the information.  Changes to assessments made solely on the basis of building permits without analysis of all other properties in the Village would also be a type of selective reassessment.  The market value of all properties are constantly changing as supply and demand factors change in the market, not just on properties for which building permits have been issued.  The fact, as Wilkes contends although fails to substantiate, that “many assessors” do not follow the practices identified in the comment above, does not make their actions appropriate or legal.

 

4)      “… if the property appears to be under assessed, the assessor may then decide to add to the assessment to account for the improvement (only to the extent of its cost).”[66]

 

Comment:  The assessor’s job is to determine the market value of the real property and set assessments for all properties at a uniform percentage of their market value.  Subsequent to an improvement, if the assessment on the property is above or below the uniform percentage of market value for the community, the assessor should adjust the assessment to maintain uniform assessments.  The assessor is not restricted to the cost of the improvement, only to the overall market value of the property (including any improvements) in relationship to the uniform percentage of value of all other property in the jurisdiction.  The restriction on the assessment to the cost of the improvement is derived from the “cost approach to value”.  The goal of the cost approach to value is ultimately to estimate the market value of the property.  Any consideration of a restriction on increasing the assessment must be based on the value contribution of that improvement to the overall value of the property adjusted by the uniform level of assessment of the roll and not the cost of the improvement.  See the comment to statement # 2 in LEGAL STATEMENTS IN THE WILKES REPORT WITH COMMENTS above.

 

5)       “In many instances, assessors must make finer determinations than this.  For example, where a homeowner has embarked on a wide ranging series of renovations, the assessor may need to parse out those costs that are assessable from those that are not.”[67]

 

Comment:  What must be valued and assessed as real property is identified clearly in the New York State RPTL.  This is not a discretionary decision to be made by the assessor.  The assessor’s job (in the context of the discussion in this section) is to determine if the current value of the property increased or decreased as a result of the collective building permit work.  If so, the assessment should be adjusted to maintain the same assessment to market value ratio as all other property in the Village.

 

6)       “… during the period 1996 to April of 2005, approximately 1,300 building permits were issued in total.  The estimated cost for all of such work was in excess of $110 million.”[68]

 

Comment:  The cost estimate in excess of $110 million is probably based on cost estimates stated on building permit applications.  This is a conservative estimate of the market value change based on the fact that Village records indicated nearly 1300 permits from 1996 through 2003 and Eckert capitalization study analysis (showing room additions capitalized at 4.36 times the permit costs, first floor permit work at 1.4 times the permit cost and bathrooms capitalized at 1.4 times their permit costs, offset by other building permits that failed to add even the cost of the improvement to the value of the property). Using an equalized effective tax rate of approximately 3%, the failure to update the assessments on most of these properties probably creates a tax shift burden to other taxpayers of roughly $3.3 million every year!

 

7)      “Bronxville’s assessment roll is not egregiously random (as some Westchester rolls are).”[69]

 

Comment:  Comparison to other assessment rolls of equal or lesser quality does not make the Bronxville Village Assessment Roll any more equitable or acceptable.

 

8)      “The records by which municipal decisions are made are an essential means by which taxpayers may learn the specific basis of determinations that affect them; as is apparent here, where those records are not available or never created in the first instance, citizens are deprived of the basic right to know …”[70]

 

Comment:  We strongly agree.  This is a very important point.  Public access to assessment records is crucial to good public relations, and measures should be taken to ensure a climate of openness.[71]

 

9)      “Uniform percentage tells us something about fairness … The uniform percentage does not, however, tell us how all the assessment ratios are distributed above and below the uniform percentage.  Many assessment ratios may be significantly higher or lower than the uniform percentage, indicating that some properties are being taxed at a much higher level.  In practical terms, homes of similar value may be taxed at quite different levels; at a point, these differences may be considered so statistically meaningful as to become legally significant under the Equal Protection requirements of the United States and New York State constitutions. …the important question … is whether the data is clustered in tight proximity to the uniform percentage – the sign of equity in taxation – or are so randomly distributed as to be beyond the “rough justice” to which courts have referred.”[72]

 

Comment:  With this statement it is apparent that Mr. Wilkes is aware of the strong potential that the substantial lack of uniformity in the Bronxville assessments could lead to a costly litigation, which may require compliance with the Real Property Tax Law and the Equal Protection requirements of the United States and New York State constitutions.

 

10)  “Homeowners who are taxed too much will naturally seek legal redress while homeowners who are taxed … too little will not …”[73]

 

Comment:  While this is a basic premise of human nature and the appeals process, it is only true to the extent that people know or understand that they are being over assessed.  This may not be readily apparent if other taxpayers with similar property are also over assessed. A review and analysis of all property assessment would be the definitive proof of inequitable assessments.  The current assessment system records and analysis are so inadequate and unavailable to the taxpayers in the Village of Bronxville that most taxpayers have no idea whether or not they are being over assessed.

 

11)  “An expert statistician, such as Dr. Eckert, is able to distill assessment and sales data for a community into a literal image of the distribution and equity of the assessments in the roll.  This is the most scientific inquiry one can hope to make, and is the basis from which legal and policy decisions can be made.  It would be a mistake, and highly unscientific, to presume that a problem exists merely because the roll is aged.  The better course is to first thoroughly evaluate the equity of the assessment roll, as the Village Board asked Dr. Eckert to do, and then, once the picture is clear, proceed to the second stage of analysis and action if corrective measures are indeed required.”[74]

 

Comment:  Dr. Eckert’s report accomplished the evaluation of the equity of the assessment roll and this report clearly indicates the corrective actions required.  The analysis of impacts based on the limited, flawed data available currently or readily obtainable would not be an accurate basis to determine any useful conclusions.  Subsequent to a complete data collection throughout the Village, however, accurate information would be available to make a much more reliable and accurate impact analysis.

 

12)  “The coefficient of dispersion (COD) is among the prime statistical measures of central tendency in a data set.”[75]

 

Comment:  The coefficient of dispersion (COD) is a statistical measure of dispersion or variance, not central tendency.  The common parametric measure of central tendency is the mean.  The common non-parametric measure of central tendency is the median. [76] 

 

However, Mr. Wilkes does correctly state, “A high COD means that there may be too much randomness in the assessment roll, perhaps to the point at which there may be little or no correlation between a given home value and its assessment and thus violative [sic] of the “rough equity” requirement set forth in Bowers.”[77]

 

13)  Mr. Wilkes also correctly observed that, “Because the County tax levy is based on the Town assessment roll, not the Village assessment roll, no matter how extensive the changes to the Village assessment roll, such changes would have no effect on the amount of taxes Village residents pay to the County.  The two instances of municipal-wide revaluations in Westchester that are said to have inflated County taxes occurred in towns, not villages.”[78]

Comment:  This is important because prior misinformation has led to confusion and apprehension about county tax share shifts.  Since the Village assessment roll only affects the Village and School taxes that are wholly contained within the Village of Bronxville, all tax shifts are strictly among the Village taxpayers to re-establish fairness and equity in the real property tax.  No outside tax shifts from other towns or school districts would ever increase taxes based on the Village assessment roll.

 

14)   “In conclusion, while a Village-wide revaluation that is properly maintained is acknowledged by assessment experts to be the optimal means of achieving broad tax equity, it is also not legally required of Bronxville.”[79]

 

Comment:  A Village-wide revaluation that is properly maintained is the optimal and only effective means of achieving broad tax equity given the current status of the Bronxville assessment roll.  All other legal options cited by Mr. Wilkes fail to achieve assessment equity for the taxpayers of Bronxville.  Arguably, while a revaluation is not legally required, tax equity is required under the Equal Protection requirements of the United States and New York State constitutions.  Inequities, such as those exhibited in Bronxville, have been the impetus for tax revolts in other states such as California and Massachusetts.  Revaluations are legally required periodically in many other states such as neighboring Connecticut, yet statutory requirements do not guarantee fairness and equity.  Fairness and equity are constitutional rights that should be supported by the elected representatives on the Village Board.

 

15)    “Further, even if implemented properly, it is indisputable that there will be clusters of Village [property] owners who will experience severe financial shocks that in some cases may be unmanageable.”[80]

 

Comment:  Without an accurate impact analysis, this is a completely unsubstantiated opinion by Mr. Wilkes.  There must be some significant shift in tax shares as indicated by Dr. Eckert’s analysis of the dispersion based on the Village assessment roll and the comparison of residential assessment ratio to the overall equalization rate for the Village of Bronxville.  To rectify the current inequities, some tax shares will increase, some tax shares will remain about the same, and some tax shares will decrease.  Those who would receive substantial tax increases (absent any Village or School budget increase) would be those who have been paying far less than their fair share of taxes.  There is no foundation for the conclusion that the shifts “… may be unmanageable”.

 

16)  “If the Village Board should choose to direct a revaluation, it should do so following a thorough modeling of the tax impacts that would occur and detailed consideration of any means of mitigating the most severe impacts, such as the Homestead Tax Option and transitional assessments.”[81]

 

Comment:  See comment to item number 11 under NON-LEGAL STATEMENT IN THE WILKES REPORT WITH COMMENTS and comments to item number 1 under RECOMMENDATIONS ON ASSESSMENT ADMINISTRATION IN THE ECKERT REPORT WITH COMMENTS above.          

  

      ACTIONS AVAILABLE TO THE VILLAGE BOARD IN THE WILKES REPORT WITH COMMENTS

 

1)      “Maintain the Status Quo: Take no action to reform the Bronxville assessment roll and direct the new Village Assessor to produce and maintain the assessment roll as is going forward, with the proviso that building permit activity be monitored and addressed more appropriately on future assessment rolls.”[82]

 

Comment:  Maintaining the status quo is an unacceptable option because it continues inequitable tax apportionment among Village taxpayers and, given Dr. Eckert’s report, this places the assessor in the precarious position of signing a false statement under RPTL § 1406 (1) (cross reference RPTL § 505).  It is only a matter of time before someone takes legal action to force corrections to the roll under RPTL § 305 or making the assessor personally liable under 1406 (1).

 

Mr. Wilkes raises the possibility of taking no action in spite of the fact that he acknowledges that, “… inequities in taxation are disfavored, if not illegal, and the passage of time gradually worsens the situation.”  Even in his most conservative recommendation Wilkes recommends, “… at least ensure that future building permit activity be monitored and assessed more appropriately … with improved records maintenance,” and “… implementation of computer-assisted methods of tracking improvements and computing assessments should strongly be suggested.”

 

2)      “Plug the holes: direct the new Village Assessor to reexamine all building permit activity that occurred since 1996 and compare that to available assessment records to determine whether some property inventory remains unaccounted and, if so, add such inventory and additional assessment where appropriate, on future assessment rolls.”[83]

 

Comment:  Wilkes admits that, “Assuming that this could legally be accomplished – which is doubtful – all prior years’ tax bills would need to be recalculated and re-billed, with such a dizzying volume of collection issues stemming from general taxpayer confusion as well as changes in ownership, among other things.  This is certainly not a recommended course of action.”

 

This is an unacceptable option because it continues inequitable tax apportionments among village taxpayers and could easily be challenged as selective reassessment of only properties with building permits (Article 78) while other assessments remain at the 1967 revaluation assessment values.

 

3)      “Adopt the Town of Eastchester roll: the Village Board may dispense with its current assessment roll and replace it with the assessments of Village properties used by the Town instead, thus effectively capturing lost assessed value…”[84]

 

Comment:  Wilkes notes that, “While one might dispute individual assessment determinations involving professional judgment, it is clear that Eastchester’s assessment rolls do not contain the type of systematic omissions that are alleged to be present in the Village’s assessment rolls.”  The RPTL, at Section 1402(2) permits a village to adopt the town’s assessment roll. 

Certainly this is an increasingly popular option in which many village assessing units have given up their status as an assessing unit over the past 20 years or more.  Mr. Richard O’Donnell, the Town of Eastchester assessor, has strong record keeping and other procedures in place although not necessarily good and equitable assessments due to the number of years since the last revaluation on the Eastchester Assessment Roll.  However, since the last reassessment on the Town roll was 1941, we would be more strongly in favor of this option after the Town performed a town-wide revaluation and established a more equitable roll.  This is an option that should be studied closely by the Michaelian Institute.

 

4)      Direct a Revaluation:[85]

 

Comment:  Wilkes admits that, “Assessment experts, including Dr. Eckert, are in agreement that revaluation - and regular maintenance of the revaluation – is surely the most complete and theoretically certain means of achieving comprehensive tax equity on a continuing basis … revaluation warrants strong consideration by the Village Board as a potentially optimal approach … mitigation of severe impacts … would be more appropriately considered in detail once preliminary data needed for a revaluation has been collected and analyzed …”[86]

 

We feel that if a complete data recollection and revaluation is done properly, it is the best solution to the assessment issues.

 

 

FINDINGS AND Recommendations

Assessment Methods and Procedures

Inventory Collection and Maintenance

 

Uniform and accurate valuation of property requires correct, complete, and up-to-date property data.  Assessing offices must establish effective procedures for collecting and maintaining property data.  This property data must include property ownership, location, size, use, physical characteristics, and related valuation information such as sale prices, costs, rents and operating expenses.  Such data are also used for public relations, defense of assessments in the appeals process, performance audits and management information.[87]

 

In Westchester County, each town maintains cadastral tax maps[88].  These maps are essential to the Village to identify the current parcel boundaries and create the standard parcel identification number (PIN) used to link all other property ownership information to a particular land parcel on the earth’s surface.

 

Market value for assessment purposes is generally determined through the application of mass appraisal techniques.  Except for unique properties, individual property appraisals are not practical for ad valorem purposes.  Data collection and maintenance are usually the most costly aspects of a computer-assisted mass appraisal (CAMA) process.  The primary way to obtain accurate property data characteristic data is to physically inspect the properties on-site.  Either appraisers or specially trained data collectors should classify and collect the data according to standardized data definitions.  Assignment of subjective decisions such as construction quality class (building grade), condition, kitchen or bath quality, and site desirability should be done by or with the oversight review and consistent judgment of experienced appraisers.  To obtain the most accurate, fair and equitable values in a Village such as Bronxville, interior inspections should be required. 

 

A comprehensive data collection program should include a thorough quality control system with proper field and office audits of the data collected.  These audits should check for accuracy (e.g., valid data [i.e., numeric data in numeric fields, only valid categories used for categorical variables such as building style, construction grade, condition, heat type]), logical consistency (e.g., year built less than current year and greater than say 1600, baths greater than 1, property classified as a two-family residence has at least 2 kitchens), and field checks for consistency of collection, especially for subjective variables.  Data must be collected consistently in a prescribed format to facilitate the collection in the field, data entry into a machine-readable format, and subsequent retrieval through computerized analysis programs.  At a minimum, to avoid a redundant effort, the data collection form should serve as the data entry form.  Computer devices that allow data collectors in the field to directly encode the data on-site into a machine-readable database, thus eliminating the duplicate entry of data are preferable.  These devices can save time, data entry expenses, and improve data quality with built-in data edits that insure more accurate data without multiple site visits. 

 

Data edits built into on-site data collection devices or comprehensive data quality analysis by computerized data editing programs in the office should be used during both the initial data collection and subsequent, continuous maintenance of the parcel records.  Property characteristics data continuously change and must be updated in response to changes brought about by new parcels (parcel splits and merges), new construction, property maintenance (condition changes), fire or demolition, change in ownership, and many other factors.  Some jurisdictions confirm the accuracy of their assessment inventory and improve public relations with data mailers to property owners that disclose the information currently on record.  Corrections are requested from taxpayers prior to commencing any valuation efforts to insure the most accurate and effective valuation possible.  If most new construction is identified through building permits, a physical on-site review of the property characteristic data should be conducted at least once every six years[89]. 

 

Property Transfer Verification and Validation

 

While a property sale is not an exact indication of market value, collectively sales are considered the most direct evidence of the real estate market value.  Appraisers (and assessors) use sales in all three approaches to values (i.e., cost approach, sales comparison approach, and income capitalization approach).  The sales are used in the cost approach to determine land values to be added to the depreciated replacement cost of the structures and to calibrate the depreciation schedules to reflect physical, functional, and economic depreciation.  Sales are used in the income capitalization approach to determine overall market capitalization rates.  Finally, and most obvious, sales are used in the sales comparison method to develop market models using techniques such as multiple regression analysis (a statistical least-squares fitting process with statistical confidence testing) or the adaptive estimation procedure (based on the engineering “feedback”, an iterative partial correction value tracking process).  Sales may also be used through the selection of comparable property sales and the adjustment of those sales to reflect the subject property as it existed as of the taxable status date and valued at the statutory valuation date.  This is the most familiar format for most taxpayers since it is also the common format of bank loan appraisals and other appraisals ordered on a single property.  When sufficient sales are available, the sales comparison approach is generally considered the preferred approach for the valuation of residential properties. 

Reliability of the sales comparison approach depends heavy upon the quality and quantity of available market sales data.  Sales with special conditions, such as trades, exchanges, partial interests, land contracts, auctions, or unusual financing must be used with caution.  Since the definition of market value requires the transfer to reflect a willing buyer and willing seller, neither of whom is under duress to buy or sell, and fully knowledgeable of all the potential uses of the property, only arms-length sales should be considered for direct sales comparison.  Ascertaining the conditions of sale transfer is critically important for developing an accurate market model and property valuations.  Non-arm’s-length transactions must be screened from distorting the market analysis and sales with special conditions should be analyzed and adjusted, if necessary, before they are used.

 

Validating the sale transfer and conditions of sales is equally important on commercial, industrial, or other non-residential property.  Sales prices of commercial property are often intertwined with personal property (e.g., furniture, fixtures or equipment that is associated with the property and required to maintain the property use such as hotels, bars and restaurants, car washes, retail (display cases)), or business value (e.g., liquor licenses, goodwill value of a recognizable name, or customer lists), and often more unusual financing (e.g., purchase with leaseback agreements for a period of time, seller financed mortgages, escalation clauses tied to business outcomes, stock or other non-cash considerations).

 

It is important to maintain a separate database of the property characteristics, as they existed at the time of sale.  Properties are often improved just prior to being placed on the market to enhance their sales potential and frequently remodeled or fixed subsequent to purchase to accommodate the buyer’s preferences.  The sales price is a reflection of the buyer’s and seller’s opinion of the property value with its physical condition and characteristics at the time of purchase.  Attributing a prior or subsequent inventory to the sale price would cause inaccurate market value conclusions to be drawn. 

 

Appraisers or trained data collectors must verify the property inventory, as the property existed at the time of sale, and validate the sales transaction.  This is often accomplished while completing the on-site data collection by checking with the buyer in residence or by sending a return response questionnaire to the seller.  Attorneys, acting as agents of the buyer and seller, could also verify and validate the conditions under which the property was transferred.

 

Exemption Administration and PILOTs

 

Administration of exemption eligibility and taxable assessed value adjustments is the responsibility of every assessor.  It is critically important in the Village of Bronxville since the Village assessment roll is used to apportion school taxes.  The School Tax Relief Program (also known as STAR) is a major exemption administration effort required in only one other village in New York State[90].  Proper administration of other key exemptions for senior citizens, veterans, religious and charitable organizations and others are equally important as part of the overall tax policy program.  This can be a time consuming task and usually requires clerical support for the assessor in addition to the continuous assessment data maintenance. 

 

Payments in lieu of taxes (PILOT) are also part of the tax policy picture.  Although the Village Board sets the eligibility, terms and conditions, the assessor must consider the PILOT payments as part of the annual tax levy calculation.  Often the assessor is required to monitor the property owner’s continued eligibility under the defined terms of the agreement.

 

 

Market Analysis for a Uniform Level of Assessment

Assessments must be determined based on the current market values.  Achieving equitable assessments only creates fairness and equity at a “snapshot in time”.  Maintaining equity requires a systematic analysis of the assessments of all properties and changes in real property markets. 

An analysis and reassessment does not mean, however, that each valuation must be reviewed or recomputed individually[91].  This does mean that market values must be analyzed each year as of the taxable status date and valuation date (January 1 for the Village).  The current market values ascertained must be compared to the current assessments to determine the need for any adjustments.  If required, the assessor must subsequently adjust those properties that are “out-of-line” with the Village’s uniform level of assessment.  The term revaluation (where each valuation must be reviewed or recomputed individually) is a term used to differentiate that process from reassessment.  If assessments are maintained annually through a systematic analysis, a complete Village-wide revaluation would not be required.  The systematic analysis process required has four distinct steps.   

The first step of systematic analysis is to make sure there is complete and accurate current data on all properties and recent sales of properties at the time of sale.  The accuracy of property assessments depends on the accuracy of the data.  As stated in Uniform Standards of Professional Appraisal Practice (USPAP), “In developing a mass appraisal, an appraiser must not commit a substantial error of omission or commission that significantly affects a mass appraisal; and not render a mass appraisal in a careless or negligent manner.”[92]  The USPAP clarifying comments state that, “… an appraiser must use sufficient care in analyzing such data to avoid errors that would significantly affect his or her opinions and conclusions….  Perfection is impossible to attain, and competence does not require perfection.  However, an appraiser must not render appraisal services in a careless or negligent manner….  This requires an appraiser to use due diligence and due care.”  Basing decisions on inaccurate data will result in inaccurate and inequitable assessments. 

Data accuracy deteriorates as properties change with new construction, demolition, rehabilitation and maintenance.  These factors significantly impact the accuracy of property assessments in approximately 2 to 3 percent of the properties per year.  In order to maintain accurate data, IAAO Standards recommend that, “Property characteristics data should be continually updated in response to changes brought about by new construction, new parcels, remodeling, demolition, and destruction. …Properties should be periodically revisited [periodic field inspection] to ascertain that assessment records are accurate and current…. at least every four to six years[93].  If possible, interior inspections should be made to increase the reliability of building quality and condition ratings, as well as improving overall data credibility and equity between similar homes within a neighborhood.  Building permits can provide forewarnings on construction activity, but field verification is necessary to verify the extent of completion, quality of construction and effect on overall market value of the property.   

Accurate data on real property sales including the verification of the sale price, conditions of the transaction, and physical inventory at the time of sale are especially critical.  If data is inaccurate on a subject property, that property is not likely to get an accurate or equitable assessment.  More importantly, if the data is inaccurate on a sale property, then every time the sale is used in analysis or to determine the value of another unsold property, those other properties may receive an inequitable assessment!   

Computerized data edits can identify suspect data for field review between data recollection cycles.  Questionnaires may be used to confirm and update inventory.  Although questionnaires mailed to property owners are often returned on less than one-third of the properties, they could save field inspection time and travel expenses.  Questionnaires are usually most effective on confirming sales inventory and sales transaction information between the parties to the transaction.

The second step in systematic analysis is to stratify or segment the properties into appropriate groups for analysis.  Markets vary depending on the characteristics of the buyers and sellers involved.  Their preferences are often reflected in property location or characteristics.  Grouping properties from different markets into the same group to achieve adequate sample sizes for statistical analysis would mask or distort the actual market effects.  Grouping apartments with offices or retail properties is no more appropriate than grouping residential properties with commercial properties

 Market analysis is required to determine if real estate markets are acknowledging more subtle market differences.   Real estate markets may react differently to different types of properties such as single-family residential properties compared to multi-family residential, older properties compared to newer properties, larger properties compared to smaller properties, or properties in poor condition compared to those in good condition.  Flexibility in stratification is necessary to be responsive to more than one market influence characteristic.  Failure to stratify and analyze the market difference causes over generalized conclusions. 

 

The third step in systematic analysis is to apply appropriate analytical techniques (to each stratification group).  The step is similar to visiting a doctor’s office.  Initially, statistical or other analytical techniques must be applied to diagnose the action required.  For each stratified group, the diagnostic phase of step three must answer two questions to determine assessment accuracy (i.e., Are assessments at the appropriate level of assessment?  …Are assessments uniform within the group?).

 

                                             note: Chart omitted on web-site version
 

The appropriate methodology to use in updating the assessments is indicated (as shown in the chart above) by the answers to those two questions:

§         If the LOA is good and the uniformity is good for that type of property (as indicated in the upper left box) then no adjustment is required to the prior assessments to reflect current market values.

 

§         If the LOA is not good, but the uniformity is good for that type of property (as indicated in the upper right box) then trending can easily and cost-effectively update the prior assessments to current market values.  (Trending does not change uniformity within the group.)

 

§         If the LOA is good, but the uniformity is not good for that type of property (as indicated in the lower left box) which is typical for new construction or demolition in areas of no market change then only the parcels not at current market value should be appraised.

 

§         If the LOA is not good and the uniformity is not good for that type of property (as indicated in the lower right box) then all parcels in the group should be appraised …(or reappraise those parcels “out-of-line” to create uniformity within the group and then use trending as indicated in upper right box).

Knowing what is required does not guarantee that the appropriate action will be taken.  Applying the appropriate methodology to the groups of parcels (as indicated by the chart) is the prescriptive phase of step three of systematic analysis.  It is easy to “do nothing” as indicated in the upper left box.  When trending is required, merely divide by the median assessment to sales price ratio for the group (or multiply by the reciprocal of the ratio …i.e., median sale price / assessed value ratio).  Trending is not a substitute for appraisal.  Trending will not improve uniformity within the stratum.  Therefore, stratification in many different ways (e.g., age, construction grade, condition, neighborhood, property type) improves the chances of capturing market trends and improving uniformity.  When appraisals are required, the most efficient method depends on the volume of appraisals required.  When only a few appraisals are necessary, manual field appraisals may be the most cost effective and efficient method.  When many appraisals are required, computer-assisted mass appraisal systems are a much more efficient and cost effective method of appraisal.

 The fourth and final step in systematic analysis is to validate the results of the analysis.  Testing the conclusions drawn in the analysis with other knowledge of the real estate market trends from realtors, independent appraisers or lenders in the area, and comparison to other competitive money investment opportunities such as municipal or corporate bonds of equivalent risk, assures that results are appropriate and taxpayers being treated equitably.  This step is most critical when appraising limited groups of properties where statistical tests are less reliable such as commercial properties, more unique residential properties, or property types with a paucity of sales data.  While often the most frequently overlooked, validation of conclusions drawn from statistical analysis is a critically important step to increase credibility and reliability.  The inability to perform the systematic analysis annually leads to a downward spiral of difficulties for an assessment department. 

 Parcel and sale inventories must be kept current and accurate.  Poor data leads to improper stratification and analysis.  Improper stratification and analysis leads to poor valuation conclusions, possible improper assessments and subsequently more appeals.  More appeals require more time and unnecessary expense in value defense, field verification, and inventory correction.   

Public Information and Public Relations

 The role of public information and public relations in the assessment department in Bronxville is a very low priority.  The assessment information that does exist is poorly organized and begrudgingly disclosed.  The perception of a fair and equitable process is critical to the real property tax system.  Although no system is perfect and appraisal is an inexact science, where professional opinions may differ slightly, the taxpaying public must understand the system and have adequate access to assure them that the assessments create a fair distribution of the real property tax levy.  The assessor should continuously seek opportunities to clarify misconceptions about assessments and the real property tax system and provide the public with information about exemption eligibility, access to information, and market trends.  These opportunities may be formal requests to make presentations at civic groups; newspaper articles, radio or television broadcasts; or being generally available for informal discussions at public forums. 

Although the Town of Eastchester has not had a reassessment since 1941, and evidences considerable dispersion among assessments, their open access to information through publicly accessible computer terminals with the assessment data provides a good example of the positive benefits of public information and public relations.  The New York State Office of Real Property Services can also supply a number of reproducible public information pamphlets that help clarify and demystify the complex real property assessment administration process to any taxpayer.

 

Training, Education and Professional Development

Seeking a qualified assessor does not necessarily guarantee finding a professional capable of managing a modern mass appraisal system and maintaining equitable assessments.  While the Village Board may retain the services of an assessor on a part-time contractual basis, it does not relieve the assessor from maintaining his or her professional development and educational requirements.[94]  Specific education and skills are essential to maintaining an understanding of the changes that constantly occur in the Real Property Tax Law and mass appraisal systems and techniques.  The commitment to maintaining the professional knowledge and skills necessary should be a shared commitment by both the assessor and the appointing body.  Recognized professional development through the New York State Institute of Assessing Officers (IAO) (affiliated with the New York State Assessors’ Association  - NYSAA) and the International Association of Assessing Officers (IAAO) is strongly encouraged.

 

Value Defense

 

The most important concept to understand in value defense is that it is sacrosanct to maintain fairness and equity to each and every taxpayer.  Defense of an equitable assessment is essential to maintain that fairness.  If any taxpayer receives an unwarranted reduction in assessment through an appeals process, then every other taxpayer in the Village is being disadvantaged.  While the increase in tax shares may seem insignificant, the practice of convenient reduction begins the erosion of the equity of assessments.  An assessor maintains credibility throughout the appeals process with current, accurate property and market data, well-defined valuation methods and procedures, and the recognition brought about by professional education and designations.  However, if new information is brought to the attention of the assessor during the appeals process that was previously unknown to him or her that would affect the valuation decisions that determined the assessment, then the assessor should be grateful for the information disclosure and adjust the assessment as necessary.

 

A low number of assessment appeals should not be equated to good assessment practices.  On the contrary, often few appeals mean the assessments are too low or too difficult to understand in relationship to other assessments.  It may also indicate that the appeals process is not clearly understood, taxpayers may lack access to adequate information to assess their equity, or taxpayers feel that their valid arguments will be ignored and thus consider that an appeal would be a waste of time.  While numerous requests for information may occur, assessment appeals after a quality revaluation would typically be made on 10 to 15 percent of the parcels on the assessment roll. 

Other General Administrative Functions

 

The assessor should protect the assessment records through routine backup and recovery testing procedures.  Security and backup of these computerized data files is relatively easy and inexpensive. 

Appendix A: Consultant Qualifications:

Bruce W. Sauter, AAS, IAO

48 FAR FIELDS ROAD   BREWSTER, MASSACHUSETTS 02631             (508) 896-8328

 

State of New York                                                                                      (1972 - 2005)

 Office of Real Property Services (formerly the Division of Equalization and Assessment)

Chief Information Officer and Chief Valuation Strategist             August       2002

Core Process Manager, Valuation                                               May            1999

Asst. Program Manager, State Assessment Services                June          1995

Director, External Services                                                           August       1994

Director, Bureau of Local Assessment Services                         January     1990

Director, Bureau of Valuation Services                                        June          1986

Director, Valuation Research and Development                          November 1980

                                    and a series of 6 progressively responsible positions since                            August            1973

                        Department of Correctional Services                                                       

Bureau of Research and Statistics, Crime Statistics Unit                     August        1972

 

Significant Accomplishments:

 

Without increasing personnel or funding, successfully led and implemented an innovative solution to meet customer requirements with a first of its kind public-private partnership involving the cooperation of State, county, and local governments with IBM. This mutually beneficial relationship; allowed local governments to manage their own assessment administration needs locally and save them hundreds of thousands of dollars annually; allowed IBM to meet their customer needs and significantly expand IBM system sales and use in the governmental sector; and allowed the State to expanded the use of the standardized Real Property Assessment System (RPS) to over 94 percent of the municipalities facilitating assessment roll classification and equalization rate survey selections, assessor training programs, and tax policy studies.

 

Developed the textbook outline and was a global editor for the International Association of Assessing Officers' textbook Property Appraisal and Assessment Administration used to support the professional education program of the IAAO worldwide and adopted as a text for college accreditation through the University of British Columbia, New York University (Masters Program in Real Estate), and the Empire State College among others.

 

Received the 1994 New York State Association of County Directors of Real Property Tax plaque award for recognition and appreciation of support and assistance given in dealing with the issues of real property tax administration in New York State

 

Built an employee-management consensus that balanced agency goals and objectives with employee needs leading to improvements in productivity, employee working conditions and fiscal savings  This New York State Management/Leadership initiative was recognized as a significant achievement with newspaper and television coverage from coast to coast.

 

Analyzed tax policy issues analyzing the ramifications of shifting the fiscal infrastructure base from the Real Property Tax to a payment in lieu of taxes (PILOT) lauded by many local government officials and legislators with vested interests.

 

Created the Valuation Services Bureau and managed program planning and implementation of statutory responsibilities in several different bureaus with statewide regional staffing.  Negotiated contracts and litigation settlements on behalf of the agency.

 

Champion for technology advancements by developing the first videodisc on real property, integrating Geographic Information Systems (GIS) technology in real property tax administration, evaluating optical scanning recognition, image storage and retrieval, and Internet based network opportunities.

 

Successfully influenced and negotiated policy changes with the New York State Appraiser Licensing Board to sanction mass appraisal experience criteria for Appraiser Licensing in New York State.  Appointed to The Appraisal Foundation’s (ASB) task team to rewrite Standard 6 (Mass Appraisal).

 

Bruce W. Sauter (continued)

48 FAR FIELDS ROAD                BREWSTER, MASSACHUSETTS 02631                  (508) 896-8328

 

Active member of the International Association of Assessing Officers (1984 -2005); Executive Board (1996 -98); IAAO Representative to the Association of Appraisal Regulatory Organizations (AARO) and The Appraisal Foundation (TAF) (1996 -2004); Chairperson of the Planning and Operations Committee (1998-99); Chairperson of the Research and Technology Committee (1995-96) and Chairperson of the Computer-Assisted Appraisal Section (1990-92); Budget Subcommittee (1997-98), Infrastructure Review Committee (1996-97); Rules and By-Laws Subcommittee(1992-94); Nominating Committee (1995); USPAP and Appraisal Regulatory Advisory Committee (1999-2004), Computer-Assisted Appraisal Section (1990-97);  State Representative for the IAAO (1986-91); IAAO Presidential Citation (1991,1992, 1998, 1999, 2000, 2001, 2004). Additional professional memberships include: New York State Assessors' Association (1981-2005), New York State Institute of Assessing Officers (1985-2005) and the Western New York Chapter of the IAAO (1992-2005). Formerly a member of the Northeast Regional Association of Assessing Officers, Albany/Schenectady County Assessors' Association, IAAO Mapping Section, and Urban and Regional Information Systems Association (URISA).

 

 

Publications

§         "Economic Model for Appraising Vacant Commercial/Industrial Property in the Absence of Existing Sales Data", (Sauter), Florida Department of Revenue Property Appraisers' School, Tampa Fla., (FDR) 1994.

 

§         "Generating Revenue Without Raising Taxes", (Sauter), State and Local Government Executives Conference Proceedings, International Business Machines (IBM) 1992.

 

§         Property Appraisal and Assessment Administration: IAAO, (Chapter outlines, global and technical editing), International Association of Assessing Officers (IAAO) 1990.

 

§         "Valuation Stability: A Practical Look at the Problems", (Sauter), Property Tax Journal 6(4) 243-50, International Association of Assessing Officers (IAAO) 1987.

 

§         "Chapter 9: Computers and Comparable Sales", (Sauter), Introduction to Computer Assisted Valuation, Lincoln Institute of Land Policy (LILP) 1985.

 

§         "Pros and Cons of Using Financial Data in Appraising Real Property", (Sauter) Chapter 23, 3rd Annual Institute on State and Local Taxation, New York University (NYU) 1985.

         PRESENTATIONS and SPEECHES

§          World Congress on Computer Assisted Valuation, I and II and the Lincoln Institute of Land Policy

§          Institute on State and Local Taxation

§          International Association of Assessing Officers'                     

Participation in Technical Seminars and Annual Conference on Property Tax Administration

Hollywood, Florida                      1984       Reno, Nevada                  1985               San Francisco, California        1986

New Orleans, Louisiana                            1987           Nashville, Tennessee        1988       Fort Worth, Texas      1989

Montreal, Quebec, Canada       1990       Phoenix, Arizona              1991               St. Louis, Missouri                    1992

Seattle, Washington                   1994       Chicago, Illinois               1995               Houston, Texas                         1996

Toronto, Ontario, Canada          1997       Orlando, Florida               1998               Las Vegas, Nevada                  1999

Miami, Florida                              2001       Nashville, Tennessee    2003               Boston, Massachusetts           2004

Anchorage, Alaska                      2005       …also attended Las Vegas, Nevada (1977)

§          State and Local Government Executives Conference (IBM)

§          Northeast Regional Association of Assessing Officers

§          N.Y.S.  Association of Counties and N.Y.S.  Association of Towns

§          N.Y.S.  Assessor's Association and the Albany-Schenectady County Assessor's Association

§          N.Y.S.  Interdepartmental Conference on Data Processing

§          Florida Department of Revenue Property Appraisers' Conference

§          Massachusetts Chapter IAAO and the Western New York Chapter IAAO

Bruce W. Sauter (continued)

48 FAR FIELDS ROAD                BREWSTER, MASSACHUSETTS 02631         (508) 896-8328

 

         TECHNICAL TRAINING

§         Bachelor of Science Physics/Mathematics at the State University of New York at Albany

 

Successful completion of the following professional development courses:

§         Managing N.Y.S. Management/Leadership Level I, Management Communications (American Management Association), Communication Skills for Managers, Oral Presentations, Time Management, Strategically Working Effectively in Teams, Introduction to Quality, Quality Improvement Process and numerous Quality Forum Seminars.

 

§         Course 1: Fundamentals of Real Property Appraisal, Course 2: Income Approach to Valuation, Course 3: Narrative Appraisal Report Writing, Course 207: Industrial Property Appraisal, Course 302: Mass Appraisal of Income Producing Commercial Properties, Course 311: Residential Modeling Concepts, Course 400: Assessment Administration, Course 402: Tax Policy, IAAO Commercial Case Study Exam, Seminars on Computer Assisted Appraisal Systems, and the Workshop on Narrative Appraisal Report Writing from the International Association of Assessing Officers (IAAO).

 

§         Computer Assisted Mass Appraisal and Multiple Regression Basics, Land Valuation Methods, Land Valuation for Rural Property, Mathematical Methods for Computer Assisted Mass Appraisal, Feedback Computer Assisted Mass Appraisal, and Computer Assisted Mass Appraisal Potential for Commercial Property from the Lincoln Institute of Land Policy (LILP).

 

§         Advanced Rural Appraisal from the American Society of Farm Managers and Rural Appraisers (ASFMRA)

 

§         Appraisal Licensing Courses R1, G1, Ethics and Standards of Professional Appraisal Practice [USPAP] (Manfred Learning Center) and G3 (NYSAA/IAO at Cornell University)

 

§         The First and Second World Congresses on Computer Assisted Valuation (LILP/ IAAO)

 

Consulting:   Real Property Tax Administration, Management and Valuation Systems

 

Town of Kennebunk, Maine                                       County of Brevard (Melbourne, Titusville, Canaveral), Florida

      City of Boston, Massachusetts                        County of Luzerne, (Wilkes-Barre, Hazelton), Pennsylvania

City of Minneapolis, Minnesota                                County of Jasper, Texas

City of Providence, Rhode Island                             County of Johnson (Olathe), Kansas                             

City of Richmond, Virginia (3)                                   County of Johnson, Texas

City of Washington, District of Columbia                                County of Orange, Texas

State of Vermont                                                          County of Pinellis (Clearwater/St. Petersburg), Florida

State of Maryland                                                         County of Prince William, Virginia

City of Calgary, Alberta, Canada                       County of Sarasota, Florida

City of Montreal, Quebec, Canada                   County of Shelby (Memphis), Tennessee

                        And independent taxpayers in the Village of Bronxville, New York

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

APPENDIX B: bronxville Zoning Map

            APPENDIX c: Data Collection/Revaluation Contractors

Reappraisal Firms WORKING in New York State OR CONNECTICUT

APPRAISAL CONSULTANTS

32 Ripplewood Drive

Rochester, NY 14616-1502

Attn: Mr. Robert D. Hilbert

(585) 865-2078

Appraisal Resource Group, Inc.
135 Wall Street
Coventry, CT 06238
 

(800) 249-4372 or (860) 742-9662
Fax: (860) 742-9815
E-mail: argivt@msn.com

 

Michael Bekech d/b/a
Assessment Services
84 Hope Street
P.O. Box 135
Niantic, CT. 06357-0135
(860) 739-9285 or (860) 303-5013
Fax: (860) 739-9285

 

BRIGGS APPRAISAL SERVICE

13 Church Street

Cortland, NY    13045

Attn: Mr. David W. Briggs

(607) 753-1232

Fax: (607) 756-0726

 

GAR ASSOCIATES

2399 Sweet Home Road

Amherst, NY 14228-2326

Attn: Mr. Walter Allen

(716) 691-7100

Fax: (716) 689-0601

 

KVS Information Systems, Inc.
821 Maple Road
Williamsville, NY 14221-3299
Telephone: (716) 626-1976
Fax: (716) 626-1973
E-mail: sprechel@kvsinfo.com

 

Manatron, Inc. (formerly Sabre Systems and Services)       

4105 Executive Drive                          9111 Springboro Pike

Beaver Creek, OH  45430                  Miamisbury. OH 45342

(800) 776-7227                                   (937) 866-6000

Fax: (937) 866-2214                           Fax: (937) 866-2214

E-mail: sabre@manatron.com

MJW Consulting, Inc.

33-33 161 Street

Flushing, NY  11358

Attn: Mr. John M. Watch

Email: john@uspdr.com

(718) 321-7114

Fax: (718) 939-4006

 

Northeast Appraisals & Mgmnt. Co., Inc.

PO Box 4805

Ithaca, NY 14852-4805

Attn:     Mr. Kenneth Gardner II, President

(607) 272-9500

Fax: (607) 273-0703

 

PBS Systems, LLC
750 Main Street - Suite 606 - 6th Floor
Hartford, CT  06103
(860) 246-7555 or (866) 246-7555
Fax: (860) 246-7557

E-mail: smulready@hotmail.com 

 

J.F. Ryan Associates, Inc.

143 Merrimac Street

Newburyport, MA  01950-2429

Attn:  Mr. John Ryan, CAE

(978) 462-0036

Fax: (978) 463-0011

E-mail: jfryan@comcast.net

 

SIGMA SYSTEMS

6265 Sheridan Drive, Suite 202

Williamsville, NY  14221

Attn: Mr. James Moesch

(716) 634-8787

 

TYLER TECHNOLOGIES, INC. (former Cole-Layer-Trumble – CLT)

12 Goose Lane

Tolland, CT 06084

Attn: Mr. Paul M. Flynn, ASA, Sr. Vice-President

(860) 872-9747

(800) 273-8605

(860) 872-9526 (FAX)

 

Vision Appraisal Technology, Inc.
44 Bearfoot Road
Northboro, MA 01532
Telephone: (508) 351-3600
Fax: (508) 351-3798