Property Appaiser Cites Pressure to Raise Assessments, Property Taxes

Escambia County Property Appraiser Chris Jones says the Florida Department of Revenue is trying to force him to raise property assessments, a move that could reduce potential tax savings for some home, business and rental property owners.

Jones said state officials rejected his preliminary tax roll. He said he suspects they want an increase of up to 15 percent, although they have not given him a specific percentage.

“We have gotten an attorney to respond to the Department of Revenue,” Jones said. “We feel we are on solid ground, right is on our side and the market will bear that out.”

Department of Revenue officials, however, said they have not turned down Jones’ tax roll and are just waiting for him to resubmit paperwork he used to justify lowering appraisals.

“There were just some things he needs to provide to us, that’s all,” said Department of Revenue spokeswoman Renee Watters. “It is a very routine part of the process that we go through every year at this time with different counties.”

But Jones, who has worked in the property appraiser field for 28 years, said the situation is anything but routine in the Florida housing market.

“I’ve been the property appraiser for Escambia County for 12 years, and I’ve never had this happen,” he said.

If the matter is not settled, the Department of Revenue could take Jones to court in an effort to force him to adjust the appraisals or ask Gov. Charlie Crist to remove him from office. Watters doubts the problem will reach that point.

“Our expectations are his roll will be approved once he completes the paperwork,” she said.

In reviewing county tax rolls, the Department of Revenue compares property appraiser assessments to the actual prices for which properties sell. But Jones is arguing that such a comparison does not present a true picture of the local real estate market.

He contends that the market, especially the residential market, is so sluggish that sellers are having to make numerous financial concessions, not reflected in the sales price, to unload their properties. As examples, he cited sellers paying closing costs normally left to buyers, or sellers purchasing new appliances, privacy fences, plasma TVs or other expensive amenities as part of the sale.

“If I sold you a house for $150,000 but gave you $5,000 in concessions, then that house’s real value is $145,000,” Jones said.

He said he is bound by law to take concessions into consideration when assessing a home.

Florida statutes state the “property appraiser shall take into consideration the net proceeds of the sale of the property, as received by the seller, after the deduction of all the usual and reasonable fees and costs of the sale.”

Rates, taxes and glut
Before Hurricane Ivan made landfall in September 2004, there were between 1,200 and 1,500 homes for sale in Escambia and Santa Rosa counties. This year’s tax rolls are based on home sales in 2006, when there were more than 7,000 homes up for sale.

New home sales in Escambia County dropped 41 percent in the fourth quarter of 2006 when compared to the previous year, according to the Haas Center for Business Research and Development at the University of West Florida. During the same time frame, Santa Rosa’s new home sales dropped 35 percent.

The housing glut, skyrocketing Florida mortgage holder’s insurance rates and property taxes generally are agreed to be contributors to the drop.

Several real estate salespeople also said they agree with Jones that sellers are making frequent concessions.

“There is just about a concession on every house sold,” said Paradise Home Realty Florida mortgage broker associate Trish Sarfert.

Lucretia Lamb, a sales associate with Century 21 Southern Home Realty, said many homeowners are offering to pay the first year’s cost for insurance or property taxes or for both.

Studying the market
Jones said he can’t just tell the Department of Revenue that home values are lower than the sales price. Rather, he said, he has to prove it with a study. Therefore, he said, he began asking Department of Revenue officials in February for direction on how to perform an acceptable study.

He said he never got a response but performed the study anyway, spending “a lot of time” interviewing real estate professionals and building contractors to understand what is going on with the market.

The state turned down Jones’ completed 65-page study and ruled his tax roll an “incomplete submittal.” He said a ruling on whether the tax roll is too low won’t be made until the issue of the study is settled. Jones is convinced the denial of his study was a pretense to refuse his tax roll.

“The bottom line is they don’t like our numbers and feel they are too low,” Jones said. “They told me they were too low,” he said. “In my opinion, they are just hiding behind the incomplete submittal.”

Watters said that is not true.

“I don’t know anything about that,” she said.

SOURCE: The Pensacola News Journal