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HomeMy WebLinkAboutM112995 , , Jefferson County Board of Equalization TELEPHONE: 385.9100 COURTHOUSE P.O. BOX 1220 PORT TOWNSEND, WASHINGTON 98368 . ,~...r;.(.':it;~ji ~I'~,,', C"., >~II, :f~,',>J3:i h" 11'" ~'"', T "', "''-, ~~'. ',",''''1 ,I; ~h~""""I"\' "'f' II,> .~,:'. ,I,~> ~,' "~ ';_;~.ilf ~ c.,. " ,,'. - . ~,. '" ,.".."" '." ... .,', ,'" ,,~" .", ' ""',", .:' ", ,', r' :": ',~. ' y-'!'''- -', '. .',',lJ;,", d'jfrl-':;o,,'-Jf.~.-_ !~Ul--,", ;;;,' \i~r:':;;!xth1.l, 1~t: :~)~ :~~~~~~-\;.::';~:'" ~ JEFFERSON COUNTY BOARD OF EQUALIZATION MINUTES NOVEMBER 29, 1995 William S. Marlow Richard A. Broders James A. DeLeo Chairman Vice-Chairman Member Chairman William S. Marlow called the meeting to order at 9:30 a,m. in the presence of Vice- Chairman Richard A. Broders. Member James A. DeLeo was not present. HEARINGS David & Jeane Woodruff 371 S. Bay Way Port Ludlow, W A 98365 BOE: 95-122-R PN: 976800038 Mr. and Mrs. Woodruff were present. Robert Kingsley was present on behalf of the Assessor's office. Chairman Marlow eXplained the hearing process and swore them in. The property under appeal is located in Port Ludlow. Mr. Woodruff presented a letter addressing their concerns, which he read to the Board. It states that they believe the method of valuation used by the Assessor's office is flawed. Specifically, the letter states: "Consider two theoretical identical neighboring waterfront properties purchased for the same price at the same time by different buyers. Property one is developed in accordance with building permits under one set of available technologies and county policies and codes as well as the professional opinions of the current county representatives, i.e. sanitarian. As a result, property one becomes limited in use to a single bedroom, single bath residence with a relatively smaller resale value. Further, the original permitting circumstances have driven permanent decisions as to size and siting of auxiliary buildings, roads, septic installations, landscaping, wells and other uses. Identical property two is developed a few years later subject to changed technologies, codes and professional interpretations. Result---markedly different development decisions are available. For example, a multiple bedroom residence can be built with the result that the second property has a much higher resale value. This value is not based entirely on waterfront footage, but rather, in large part, on decisions driven by how the county permitted development at two different, but close, points in time, The true per front foot value has been permanently affected. As a result, one basis for the permanent land value of two [lUviously identical properties has been unalterably changed. \.J 100% Recycled Paper BOARD OF EQUALIZATION MEETING MINUTES - NOVEMBER 29, 1995 Page 2 It is unreasonable to assume that improvements can be removed from property one in order to obtain the same basic land value as property two. Consequently, we are requesting that the county revalue this property subject to the considerations presented above. Thank you." A second letter was submitted during the hearing which states "Further, we maintain that the use of a predominant factor, i.e. a locally standardized front foot value for waterfront property, to determine a specific property value, is questionable. The technology now exists to establish a discrete information data base for any given property. Current assessment practices appear to apply macro factors associated with aggregated properties. It wquld be more equitable to apply micro factors associated with the individual property. For example, in the case of the subject property, the county has used three comparables, two of which occurred after the 1/1/95 date mentioned in the Assessor's cover document as the understood cut-off. In the first case it lists a sale of 10/95, parcel 976800039, as having no improvements. In fact, the property has a small mobile, a multiple bath septic system and a well. It is no bank. The second case, parcel 97600039, sold 5/95, has a much larger square footage of ground and a septic permit for the three bedroom house built there. It has lower bank than our property. The third, parcel 97600016, sold 7/94 lists a mobile home. To the best of our knowledge, the building is a large prefab. It has a lower, steeper bank than ours. Our property consists of an approximately 880 sq,ft., remodeled one bedroom, one bath house which had been brought in on a truck years before we bought the property in 1967, plus outbuildings as described. We have the highest bank in our immediate area on our two lots. The reason for this is that we are on a property that is underlain by a solid basalt rock ridge that runs diagonally under the whole property, from front to back. The county drainage ditch across the road from our property is bottomed by the exposed bedrock of this formation. As a result, we were required to rebuild no more than a one bedroom, one bath house, There is only a small portion of the lots that would perc. This required the installation of the current modified mound system. Further, this lot is more sloping than others in the area, has a double slope, back to front and side to side, effectively making the two lots into a single property that could not be divided. The property is further constrained by the placement of neighboring wells and a neighboring pond. We will be pleased to demonstrate these conditions to the Board when it does an onsite inspection for purposes of this appeal. Thank you." The appellants are requesting the Board reduce the current assessment from $186,025 ($120,080 for the land and $65,945 for the improvements) to $150,000 ($100,000 for the land and $50,000 for the improvements). Mr. Kingsley stated that he has not received any comparable sales which substantiate the appellant's estimated value. The appellant commented that comparable sale #1 used by the Assessor's office, included a mobile home, well and septic system. Mr. Kingsley stated that when the property was sold, the excise tax affidavit stated that the property was bare land. The mobile home, well and septic system were added after the purchase. He continued by explaining how property is valued. In regard to comparable sale #1, Mr. Woodruff stated that there was a mobile on that property for years, however, the older mobile home may have been removed and replaced with a new mobile home during the transfer. Additionally, there has been a septic system on the property for a number of years and the well was drilled as a condition of sale. After hearing the testimony of both parties the Board concurred to conduct an inspection of the property and make a determination at a later date. BOARD OF EQUALIZATION MEETING MINUTES - NOVEMBER 29, 1995 Page 3 Member DeLeo was present for the following hearings. Jerald & Laurie Hampton 421 OIele Point Road Port Ludlow, WA 98365 BOE: 95-110-R PN: 921283010 Mr. and Mrs. Hampton were present. Robert Kingsley was present on behalf of the Assessor's office. Chairman Marlow explained the hearing process and swore them in. The appellant's property is located in Port Ludlow. Mr. Hampton stated that they are appealing their property value for the following reasons: 1) front footage; 2) Overpaid; 3) the bogg; 4) No services; 5) the quarry; and 6) the rate of increase. The front footage rate has increased from $900 to $1,200. They believe there is an inequity between the value of their property and the value of their neighbors' property. They feel they paid too much for the property. There are no services in that area. The quarry is owned by a new company which has increased its operations and is more noisy than it used to be. The appellants are requesting the Board reduce the current assessment from $385,615 ($174,000 for the land and $211,615 for the improvements) to $331,075 ($130,620 for the land and $200,455 for the improvements). Mr. Kingsley stated that according to the law the property must be valued at its true and fair market value as ofJanuary 1, 1995. In order to do this the Assessor's office reviews all the properties that have sold and those sales are used to value similar property. The amount of increase is based on the market. He presented and discussed comparable sales in the area. Discussion ensued regarding the real estate market and front footage rates. After hearing the testimony of both parties the Board concurred to conduct an inspection of the property and make a determination at a later date. Dennis & Jean McCarthey 393 Olele Point Road Port Ludlow, W A 98365 BOE: 95-111-LO PN: 921283002 Mr. and Mrs. McCarthey were present. Robert Kingsley was present on behalf of the Assessor's office. Chairman Marlow explained the hearing process and swore them in. The appellant's property is located in Port Ludlow. The McCarthey's are very concerned with the tax structure and question the rate of increase. The appellants own 160 feet of waterfront property which is assessed at $1,263 per front foot, while the adjacent property consists of277 feet of waterfront and is assessed a lower rate of$854 per front foot. According to the records in the Assessor's office, the adjacent property receives a reduction for excess front footage and a 20% reduction due to wet areas. Excess front footage adjustments are made on waterfront property over 150 feet in width. Since, they own 160 feet of waterfront property, they feel they should be eligible for a reduction as well. Topographically, the two properties are very similar, however, they believe their property has more wet areas than the adjacent property and yet no adjustment was made to their valuation. In closing he stated that they do not feel that the sales used by the Assessor's office are comparable to their property. The appellants are requesting the Board reduce the current assessment from $338,340 ($202,080 for the land and $136,260 for the improvements) to $272,965 ($136,705 for the land and $136,260 for the improvements). BOARD OF EQUALIZATION MEETING MINUTES - NOVEMBER 29, 1995 Page 4 Mr. Kingsley presented and discussed comparable sales in the area. The appellant's property value was reduced by 1 % for excess front footage. He explained that the percentage of reduction is based on a sliding scale. The larger the waterfront parcel, the higher the percentage of reduction. A reduction for wet areas was not made since there are two home sites on the appellant's property and it appears as though the wet areas would not affect the market value. At the close of the hearing the Board concurred to conduct an inspection of the property and make a determination at a later date. William Eldridge 561 OIele Point Road Port Ludlow, W A 98365 BOE: 95-164-R PN: 95-165-R 95-166-LO 95-167-R 921 283 001 961 802 004 961 802 005 961802006 Mr. Eldridge was present. Robert Kingsley and Will Butterfield were present on behalf of the Assessor's office. Chairman Marlow explained the hearing process and swore them in. The property recorded under parcel number 921 283 001 is located in Port Ludlow and was appraised by Robert Kingsley. The property recorded under parcel numbers 961 802004,961 802005 & 961 802006 are located in Port Hadlock and were appraised by Will Butterfield. The hearing began with the Board taking testimony regarding the property located in Port Ludlow. Mr. Eldridge stated that the comparable sales used by the Assessor's office to value parcel number 921 283 001, are not comparable. Those parcels have water views, while his does not. The parcel under appeal is located behind the parcel which contains his home and he doesn't feel that it should be valued separately. He is requesting the Board reduce the current assessment from $33,315 ($12,000 for the land and $21,315 for the improvements) to $19,000 ($7,000 for the land and $12,000 for the improvements). Mr. Kingsley stated that the Assessor's office is required to value property at 100% off air market value. During his inspection he observed that Mr. Eldridge owns property recorded under two separate parcel numbers. The law states that each parcel must be valued separately. He then explained how the property was valued. If Mr. Eldridge wants the two parcels to be valued as one parcel, he could apply for a boundary line adjustment to legally combine them. After hearing the testimony of both parties the Board concurred to conduct an inspection of the property and make a determination at a later date. The hearing continued regarding the property located in Port Hadlock which consists of an apartment complex. Mr. Eldridge pointed out that the map presented by the Assessor's office which outlines his property is incorrect. He identified the proper location of his parcels and the correction was noted. In reading through the information he received from the Assessor's office he noticed that he is being assessed for more lots then he actually owns. The Assessor's office records also show that the laundry building is located on lots 21 and 22, when it is actually located on lots 23 and 24. Parcel number 961 802004 is currently assessed at $12,720 ($6,000 for the land and $6,720 for the improvements); parcel number 961 802005 is currently assessed at $6,000; and parcel number 961 802006 is currently assessed at $465,025 ($77,855 for the land and $387,170 for the improvements). He is requesting the Board value all the parcels as one parcel and reduce the value to $390,000 ($40,000 for the land and $350,000 for the improvements). BOARD OF EQUALIZATION MEETING MINUTES - NOVEMBER 29, 1995 Page 5 After reviewing the information, Mr. Butterfield agreed that a mistake had been made. Mr. Eldridge should only be assessed for 16.2 lots. The records can also be changed to reflect the correct location of the laundry building, however, this change will have no affect on the value. The lots that have separate parcel numbers must be valued separately. If Mr. Eldridge consolidates all the lots into one, they could be valued as one parcel. After hearing the testimony of both parties the Board concurred to conduct an inspection of the property and make a determination at a later date. Donald & Lynn Giese 295 S. 7th Avenue Port Hadlock, W A 98339 BOE: 95-179-R PN: 994200050 Mr. and Mrs. Giese were not present. Will Butterfield represented the Assessor's office and was sworn in by Chairman Marlow. The property under appeal is located in Port Hadlock. It states on the petition that "1.) Mobile home is 1969 single wide. Appraisal at $18,680 is far too high. 2.) Purchase price of property is lower than appraisal should reflect." The current assessment of the property is $37,180 ($18,500 for the land and $18,680 for the improvements). The appellants are requesting the Board reduce the current assessment to $28,500 ($18,500 for the land and $10,000 for the improvements). Mr. Butterfield stated that the appellants purchased this property in April of 1995 for $41,200. In the appellant's petition it states there is bank appraisal listing the property value at $48,000. He feels the current assessment of $37,180 reflects fair market value. At the close of the hearing the Board concurred to conduct an inspection of the property and make a determination at a later date. Guy Rudolph 1225 Irondale Road Port Hadlock, W A 98339 BOE: 95-142-LO 95-143-R PN: 952 800 208 952 800 209 Mr. Rudolph was present. Mr. Butterfield was present on behalf of the Assessor's office. Chairman Marlow explained the hearing process and swore them in. The property under appeal is located in Port Hadlock. Mr. Rudolph questions the equity of the assessments in this area. The rate per front foot increased from $250 to $600. Other properties in the area that he feels are superior to his, are only valued at $11,000 per acre. He is requesting the Board reduce the current assessment of both parcels to the previously assessed amount (the specific amount was not provided). Mr. Butterfield presented a map outlining comparable sales in the area. He explained how the properties in that area were valued. Mr. Rudolph's property is valued at the lowest rate in the area. After hearing the testimony of both parties the Board concurred to conduct an inspection of the property and make a determination at a later date. BOARD OF EQUALIZATION MEETING MINUTES - NOVEMBER 29, 1995 Page 6 Jesse & Lisa Osmer 320 Old Anderson Lake Road Chimacum, W A 98325 BOE: 95-161-R PN: 901113021 Mr. Osmer and his Attorney Norm Short were present. Will Butterfield was present on behalf of the Assessor's office. Chairman Marlow explained the hearing process and swore them in. The property under appeal consists of a mini-storage located in Port Hadlock. Mr. Short stated that he understands that the current assessment of$336,885 is based on sales. Particularly on the sale of the property under appeal, which the appellants purchased in December of 1994 for $350,000, The current assessment is broken down into two components, the land and the improvements, and the value is allocated between the two. It is the appellant's position that a third component should be considered. When the appellants purchased the property, they were not just purchasing the land and the buildings, they also purchased an already established mini-storage business. The business or "going concern" has a value of its own and is typically considered during the purchase of a business. This is also in accordance with standards set by the Internal Revenue Service (I.R.S.), where value is allocated between the goodwill and intangible value ofa "going concern" business as well as the land and the buildings. The appellants are requesting the Board reduce the current assessment from $336,885 ($93,120 for the land and $243,765 for the improvements) to $242,000 ($27,000 for the land and $215,000 for the improvements). Mr. Butterfield stated that the appellant's petition is based on information that was not mentioned in Mr. Short's testimony. He was unaware that "blue sky" value was an issue in this case. Regardless, the Assessor's office does not value the "blue sky" component, which is considered intangible personal property. The Assessor's office values the land and the improvements of property only. Mr. Butterfield explained the details in regard to the valuation of the appellant's property. In the petition the appellants brought up their concerns about the physical condition of the building. The appellants had an inspection ofthe property prior to the purchase and they knew the amount of income the business produced. The rules of the I.R.S. may provide for the allocation of specific values to intangibles, however, the Assessor's office does not consider that in valuing real property. Therefore, if the appeal is based on intangibles and "blue sky" value he objects to it being entered at this stage. Chairman Marlow explained to the appellant that the Board is unable to accept additional information unless it was provided to all parties at least seven days prior to the hearing. Mr. Short stated that all the information was provided seven days prior to the hearing. Included in the information is a letter from a Certified Public Accountant (C.P.A.), which is set forth to establish the theory that the value should be allocated between the three separate components. Mr. Butterfield stated that the inclusion of "blue sky" value is for I.R.S. purposes. Mr. Short argued that it is not only for I.R.S. purposes. The property sold for $350,000. This purchase price also includes payment for a "going concern" business. The Assessor's method of valuation fails to consider this. Mr. Butterfield stated that if the income approach was used to value the appellant's property this may have some merit. Since Jefferson County is not a large County the income approach is rarely used. BOARD OF EQUALIZATION MEETING MINUTES - NOVEMBER 29, 1995 Page 7 Discussion ensued regarding the "blue sky" component. After hearing the testimony of both parties the Board concurred to conduct an inspection of the property and make a determination at a later date. Meeting adjourned. Attest: JEFFERSON COUNTY BOARD OF EQUALIZATION ~1A-~~-~~ ~ K. L{u;~ren, Cferk of the Board i^ ---, Willi, S. M~airman ~ ~JO~r-~L~- ~ard A. Broders, Vice-Chairman " , #" ".(U,,/ " .:i,,!r.<~{~ ,.~! )\yL-< afiles A. DeLeo, Member i_....o/