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HomeMy WebLinkAboutM040297 Jefferson County Board of Equalization TELEPHONE: 385.9100 r/'~ ~'- ''S~ ,-, - r:;(f : ,~,- . v ;-. ~I"," ~.:<- ,:;.tAf /- '- - II _ ~ / ~ \'/€:t rl, JF~?0 ~ :~;""... ~ . I ,I.~ (~.' ~ ~~' .., COURTHOUSE ~;- ", ,-h., ~pr: :. >t -"1 r' ,.... I %1 P.O. BOX 1220 h' .,' ';',' "'il / ~ rye. ,Hf PORT TOWNSEND, WASHINGTON 96368 ., l~ . ,,~{:, "91 ,I. 111~~'1ll 'i'~ JEFFERSON COUNTY BOARD OF EQU~~=- ' _~~;.1-= MINUTES ,=~--~~--- APRIL 2, 1997 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 and Member James A. DeLeo. APPROVAL OF THE MINUTES Vice-Chairman Broders moved to approve the minutes of March 10, 1997 as presented. Member DeLeo seconded the motion which carried by a unanimous vote. HEARING David & Jacquelynn Wheeler 93 Sea Vista Place Port Ludlow, W A 98365 BOE: 96-55-R PN: 998700036 Mr. Wheeler was present. Jeff Chapman 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 Teal Lake Village, in Port Ludlow. Mr. Wheeler stated that he believes property is assessed at fair market value which is based on property sales. The Wheeler's purchased their property for $182,000 in November of 1996. He believes this amount is fair market value. Submitted with his petition is an appraisal of the property listing the value at $191,000. The assessed valuation is $229,565 ($61,000 for the land and $168,565 for the improvements). This extreme difference in valuation is not reflective of market value. He understands that the original sale price in 1992 was close to the assessed value, however, the real estate market has come down and the current assessed valuation does not reflect current market value. Mr. Wheeler stated that he recently received information from Pope Resources who is working with the County Assessor to reassess the value of various parcels in Teal Lake Village. Pope Resources is lowering the value ofland in order to sell. This shows that the land is overvalued. In addition, the Wheeler's have filed for the Louisiana Pacific (LP.) siding on there house to be removed and replaced with better quality siding. This problem along with other minor things, devalue the property. Chairman Marlow asked what date the property was purchased? Mr. Wheeler answered, November 1996. n ~J 100% Recycled Paper BOARD OF EQUALIZATION MINUTES - APRIL 2,1997 Page 2 In conclusion, Mr. Wheeler reiterated that the current assessment reflects an inflated market and he would like the value of his property adjusted to reflect current market value. Jeff Chapman explained that Washington State Law allows counties to value property in one of two ways. One is an annual cycle where property is assessed every year. The second is a multi- year revaluation cycle where property is assessed every four (4) years. Jefferson County uses a multi-year revaluation cycle. Approximately half of the counties in Washington State use a multi- year revaluation cycle. For counties using this cycle the law states that every four years the Assessor will value property based on sales of the property from the prior four years. This method fundamentally freezes property values for four (4) years, until the next revaluation period. The Wheeler's property was valued on January 1, 1995 based on the prior four years of sales. The question for the Board is what was the value as of January 1, 1995? Not what is the value today? Mr. Chapman stated that it is very rare for property values to go down in Jefferson County. In most cases they go up. He reported that in the late 1980's, the assessments which had been set a couple years before, were 50% to 60% of the market value. Not one property owner complained about their property being worth more or the assessment being to low. Even if the Assessor agrees with the appellant that the current market value is much lower than the January 1, 1995 assessed value, the Board only deals with equity issues and must determine what the value was as of January I, 1995 in order to be fair to all property owners in the area. Prior to the Wheeler's purchase, this property sold in August of 1994 for $229,990. The January 1, 1995 assessment was based on that sale. Mr. Chapman stated that this information should answer the Board's question, however, if you look at the sales in the area after January 1, 1995, you will see that virtually all the sales are less than the assessed value. There was another resale in the area similar to the Wheeler's purchase, where the seller took a $15,000 loss. Mr. Chapman continued by stating that normally, the Assessor would conclude the testimony by stating that all the sales leading up to the January I, 1995 assessment date support the current assessment, however, this case brings up some concerns. In looking at all the resales in Port Ludlow, it appears that the market has only decreased in Teal Lake Village and not throughout the entire Port Ludlow area. County-wide sales have stagnated, but not significantly decreased. The most obvious decrease in market value of property is in Teal Lake Village. The cause of the market drop in this area has been attributed to the problems with the Louisiana Pacific siding as well as the additional building of houses by Pope Resources which seems to have changed the nature and desirability ofthe area. As a result of this rare market change, the Assessor believes that the sales prior to January 1, 1995 are not typical of market value and are reflective of aggressive marketing. The difficulty lies with determining the actual value. Another problem is with new construction that has occurred since January 1, 1995. Under State law, counties using multi-year revaluation cycles can value new construction as of the year it is completed. In Teal Lake Village, new construction is valued based on the sale prices which are less than the previously assessed existing homes. This has created an inequity among property owners in the area. Early in the season the Board upheld the Assessor's valuation on another appeal from Teal Lake Village. The County Board of Equalization's decision was appealed to the State Board of Tax Appeals which does not review appeals based on equity and appraisal dates, but rather on all available sales information, including those sales which occur after the appraisal dates. As a result the State overturned the County's decision and reduced the value of the property. The State reviews appeals using a different set of guidelines than those required for Counties. Having two sets of rules is a problem for Counties with multi-year revaluation cycles as it upsets equity among property owners. Mr. Chapman stated that in order to be fair, the Assessor Jack Westerman recommends reducing the value of the Wheelers property from $229,565 ($61,000 for the land BOARD OF EQUALIZA nON MINUTES - APRIL 2, 1997 Page 3 and $168,565 for the improvements) to $191,460 ($36,000 for the land and $155,460 for the improvements). Even though the Wheeler's purchased the property for $182,000, it is believed the market value is closer to $191,000. This is because it was sold by a trustee who may have been anxious to sell the property. It was listed on the market for $199,000. In the Assessor's opinion, had it been listed longer it may have eventually sold for $191,000. In addition, the Assessor developed a spreadsheet reducing the value of other parcels in Teal Lake Village and is recommending the Board of Equalization equalize all of those parcels to insure equity. The Assessor will be requesting this of the Board during the first 28 days of the Board's 1997 season. Mr. Chapman added that equalizing might cause a problem, since some property owners may not want their value reduced, as far as financing goes. Mr. Wheeler stated that the property they purchased had been on the market for a year and a half with no offers. The market is dead in Teal Lake Village. The newly constructed homes in the area are of poorer quality which may reduce their value. Mr. Wheeler stated that he did not realize that property in Jefferson County was valued every four years. He thought when property sold, it was automatically reassessed to the sale price. Based on the multi-year revaluation cycle, he feels that the Assessor's valuation recommendation of$191,000, which was also the amount of Mr. Wheeler's appraisal, is fair. With no further testimony Chairman Marlow closed the hearing. The Board concurred that an inspection of the property is not necessary, since the appellant feels the Assessor's recommended reduction in value is fair. After a brief discussion Vice-Chairman Broders moved to overrule the Assessor and reduce the value of parcel number 998700036 to $191,460 ($36,000 for the land and $155,460 for the improvements). Member DeLeo seconded the motion. Before calling for a vote on the motion, Chairman Marlow added that reducing the value of this property will cause an inequity among similar property in Teal Lake Village, thereby, necessitating the equalization of other parcels during the Board's 1997 season. He also stated that it was his understanding that the Assessor agreed with the appraisal amount of$191,000. Vice-Chairman Broders withdrew his previous motion and then moved to overrule the Assessor and reduce the value of parcel number 998700036 to $191,000 ($36,000 for the land and $155,000 for the improvements). Member DeLeo seconded the motion which carried by a unanimous vote. CLOSE 1996 BOARD OF EQUALIZATION SEASON/ APPROVAL OF MINUTES The Board concurred to approve the actions taken on this date upon the completion and signing of the minutes. There being no further business before the Board of Equalization for the 1996 season, the Board adjourned Sine Die. A~St: "';Q . I 1...-- .,' Ld' ltC E .'Gndgre Cle~he~rd JEFFERSON COUNTY BOARD OF EQUALIZATION j-' iIIi ck~ A roder, r~;;~Aq,e~o, ember