UPDATED March 2018

Alabama Legislature Requires Disclosure of Additional Information for Sales Comps in Tax Appeals

In March 2018, the Alabama Legislature passed a bill requiring certain disclosures for those intending to offer sales or lease comparables in tax appeals. SB182, which will be codified as Ala. Code (1975) §40-3-27, requires any party (taxpayer or taxing jurisdiction) introducing a sales or lease comparable in a tax appeal to disclose the following:

(1) whether the proposed comparable property was occupied or unoccupied at the time of the transaction; and

(2) whether the proposed comparable property was subject to any use, deed, or lease restriction at the time of the transaction that prohibits the property, on which a building or structure sits, from being used for the purpose for which the building or structure was designed, constructed, altered, renovated, or modified.

Under the new statute, the party introducing the sales or lease comparable must disclose this information at the time it offers the comparable into evidence. Failing to disclose the information carries a harsh penalty, resulting in the comparable being deemed inadmissible.

The new bill is effective immediately upon execution by the Governor, so taxpayers, counsel and appraisers must diligently review their sales and lease comps to ensure compliance with the new act.

Aaron D. Vansant, Esq.
DonovanFingar, LLC
American Property Tax Counsel (APTC)

UPDATED march 2020

COVID-19 Potential Relief for Tax Payments

As of April 10, 2020

The second half of property taxes for 2019 are due by May 1st. If not, individuals will be subject to interest penalties and their property taxes will be considered delinquent. Per Arizona State Law, the Counties do not have authority to extend the May 1st deadline. Extensions and changes in due dates can only be enacted by the legislature. County Treasurers have been asking for property tax relief by extending the deadline for property taxes 30 days (https://www.graham.az.gov/DocumentCenter/View/3956/Treasurer-Joint-Press-Release-Move-Deliquency-Date-PDF). If granted, this would allow individuals and businesses to pay the second half of their 2019 property taxes by June 1st, waiving all penalties and interest for payments made after May 1st.

If you have any questions about the status of this legislative effort or options for appealing your property taxes, please contact us at This email address is being protected from spambots. You need JavaScript enabled to view it..

If you or your business want to support the Treasurers’ attempt to extend the May 1st deadline, you must reach out to legislators and request property tax relief amid the COVID-19 pandemic. Below is a link to find your state legislators, and links to the rosters for the Arizona State Senate and House of Representatives. Please note you should call or email the senator and representative over your legislative district.

Find My Legislator:
https://www.azleg.gov/findmylegislator/

District Locator: simply enter your address, it will identify your Congressional and Legislative District. Then click on next link to find the senator (use LEGISLATIVE district)
https://azredistricting.org/districtlocator/

List of Arizona Senators and their Legislative Districts:
https://www.azleg.gov/MemberRoster/?body=S

List of Arizona Representatives and their Legislative Districts:
https://www.azleg.gov/MemberRoster/?body=H

Property owners may also want to contact the Arizona Department of Revenue to communicate the need for relief due to the COVID-19 pandemic: (602) 716-6843

Mooney, Wright, Moore & Wilhoit, PLLC
American Property Tax Counsel (APTC)

UPDATED june 2020

Counties Set-Up Procedures for Canceling COVID-19 Late-Payment Penalties

California law permits county tax collectors to cancel late property tax payment penalties “due to reasonable cause and circumstances beyond the taxpayer’s control.” In May, Governor Newsom issued Executive Order N-61-20 which extended tax collectors’ authority to cancel the 10% delinquency penalty if the late payment was caused by COVID-19. The Governor’s Order established the following conditions for excusing late-payment penalties: (a) the real property for which the taxes were not paid is the taxpayer’s residence or is owned and operated by a qualifying small business and (b) the taxpayer was unable to tender payment due to the COVID-19 pandemic or any governmental response to the pandemic. While the Governor’s Order applies statewide, county tax collectors have implemented the Order’s requirements in different ways. Most county tax collectors have put COVID-19-specific waiver forms on their websites with instructions for taxpayers to describe on the form how COVID-19 prevented them from paying their property taxes timely (e.g., Los Angeles County, San Diego County). Some tax collectors also require taxpayers to submit documentation of medical conditions that prevented the taxpayer from paying on time, or of economic hardship caused by unemployment, reduced employment, or the closure/non-operation of a business due to COVID-19 (e.g., Alameda County, Riverside County). For more information, consult the website of the California county tax collector in which a property is located.

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Greenberg Traurig, LLP
American Property Tax Counsel (APTC)

Updated July 2017

New Rules in Ontario

The Assessment Review Board (“ARB”), which provides the first and only level of administrative law review of assessment appeals in Ontario, has changed its rules.

The ARB new rules are effective April 1, 2017. There are 122 rules and several Practice Directions.  Most significantly, all appeals will be grouped as either “General” or “Summary”.  General proceedings have a detailed schedule to be adhered to unless it is altered by the parties with the consent of the ARB. All appeals are deemed to be general proceedings unless they are specified as summary proceedings.  The details include specified hard dates for inspections, productions, examinations for discovery, motions, exchange of witness statements and reports.

All of this means that the litigation before the ARB will be increasingly complex and rule-bound. It is not an area for amateurs. 

J. Bradford Nixon
Nixon Fleet & Poole LLP
American Property Tax Counsel (APTC)

Updated March 2015

Colorado Begins Its 2015 Reassessment

Bi-annually, Colorado Assessors perform a revaluation/reappraisal for purposes of assessing the value of Colorado property using a “base period” method. In tax years 2013 and 2014, nonresidential property values were based on sales, income and cost data from a “base period” commencing on January 1, 2011 and ending on June 30, 2012. A new “base period” with its likely higher values now comes into play. 2015 is a revaluation year in which Colorado County Assessors will reappraise the value of real property. Under Colorado law, 2015 and 2016 nonresidential property values will be based on sales, income and cost data from a base period commencing January 1, 2013 and ending June 30, 2014.

Given the general upward trend in real estate values since the last base period ending June 30, 2012, many property owners may expect to see an increase in their property values and consequently, their property taxes for 2015 and 2016. The assessors are required by law, absent significant changes in the property after the base period, to use the same value for tax years 2015 and 2016. Even if an appraised value does not increase, budget demands will likely incentivize cities, counties and other taxing entities to maximize tax revenues by increasing the mil levies that determine the assessed value and the resulting tax, to the extent permissible by a Colorado Constitutional Amendment that limits tax increases called the "Tabor Amendment".

Beginning May 1, 2015, County Assessors will mail the 2015 Notices of Valuation for real property. The property owner will have a very short period of time to evaluate these notices and protest the value set on the property. Protests of valuation for most Colorado counties must be filed by May 31, 2015. Protests of valuation for Denver County properties must be filed no later than November 15, 2015. Our property tax attorneys know the critical legal and business factors that affect real property values and classifications. We are prepared to meet with property owners to assist in evaluating their property tax situation and, when appropriate, plan their strategies for their 2015 property tax protests.

Larry R. Martinez, Esq.
Berenbaum Weinshienk PC
American Property Tax Counsel (APTC)

UPDATED September 2017

Delaware Court Unlocks Opportunities to Reduce Property Tax Burden

Managing expenses is one of the best ways to ensure the long-term profitability of investment properties.  Owners of real property know that achieving reductions in property tax assessments can be challenging under the best of circumstances, and distinctions between state tax systems can make minimizing the real estate tax burden across a commercial or industrial portfolio a daunting task.  But a recent decision by the Delaware Supreme Court provides taxpayers with a new, yet surprisingly familiar, opportunity to reduce the burden of property taxes on their properties in The First State.

Delaware’s tax assessment system shows its age
Under Delaware Law, property must be valued at its “true value in money,” a term interpreted to mean the property’s “present actual market value.”  However, in order to implement the Delaware Constitution’s mandate of tax uniformity, Delaware applies a base year method of assessing property, meaning that all property in a jurisdiction is assessed in terms of its value as of a certain date, then that value remains on the property indefinitely until the jurisdiction performs a general reassessment.  For Delaware’s northernmost county, New Castle County, the last reassessment occurred in 1983, so all property in the County is valued as of July 1, 1983.

A major challenge to contesting property tax assessments in Delaware is that a taxpayer must determine the property’s market value in 1983.  Determining what a property is worth today is not always easy, but proving a property’s value three decades ago has proven increasingly difficult.  Furthermore, because the County makes no regular adjustments to a property’s assessed value, the County asserts that a property should be valued as it existed in 1983 or, if it was built after 1983, as if it is new and undepreciated.

Delaware’s courts have explained that taxpayers have two options in assessment appeals: they can use data from the base year (by, for example, finding sales of comparable properties in or around 1983, or using prevailing market rents and capitalization rates from 1983) or they can calculate the current market value of the property and “trend back” that amount to 1983.  The County Board of Assessment Review has expressed a near-absolute preference for 1983 data, and rarely finds a taxpayer’s trending formula acceptable.

The inequities of this system are blatant.  Under the county’s interpretation of the base year system, a 34-year-old building located next door to a similar new building should be assessed and taxed at the same level, despite that buyers, sellers, and tenants might value the buildings quite differently.  If the owner of the 30-year old building wanted to contest its assessment, the owner would have to identify data for new buildings in 1983.  Of course, as time marches on and years turn to decades, relevant data from the base year becomes increasingly difficult to find.

Taxpayers highlight the system’s obsolescence
Taxpayers have raised many challenges to Delaware’s assessment system, but most successful challenges are fact-specific, and no recent court has gone so far as to order Delaware’s counties to complete a reassessment.  But after several attempts, the taxpayers in Commerce Associates LP v. New Castle County Office of Assessment underscored the largest flaw in the system.

One Commerce Center is an office condominium building in Wilmington, Delaware.  Each office condominium was originally assessed by the County upon construction in 1983.  After keeping the same tax assessment for decades, the owners of several of the condominiums challenged their assessments in 2015.

Before the County Board of Assessment Review, the owners presented five different analyses: two relied on comparable sales transactions (one using 1983 sales of buildings that were about 32 years old, and one using modern asking prices trended back to 1983 using the Consumer Price Index); two relied on income (one using 1983 data, and one using 2015 data trended back to 1983 using CPI); and a cost approach using the original construction costs and reflecting depreciation.  These approaches showed that the properties were overassessed by more than 40%.

The County presented evidence of the condominiums’ sale prices in 1985, when each unit was relatively new.  The County also presented an income approach using 1983 data and a cost approach reflecting no depreciation.  The County’s approaches all supported the original assessed values, and the Board ultimately denied the taxpayers’ appeals.

Delaware’s Court approves a decrease in value
After having their appeals denied by the Superior Court, the taxpayers brought their challenge to the Delaware Supreme Court.  In a tersely-worded decision, the Supreme Court reiterated that all relevant factors bearing on the value of a property in its current condition must be considered.  While the County argued that no depreciation was needed because the properties were brand new in 1983, the Court noted that the properties were, in reality, more than 34 years old.  Failing to account for their age and the resulting depreciation (or appreciation) resulted in a flawed value.

Although the Court’s decision has yet to be implemented by the County, its effects will likely be widely felt.  Most properties in New Castle County built after 1983 are assessed without any depreciation.  Because each tax year brings with it a new opportunity to challenge an assessment, property owners can bring a new appeal to the Board every year reflecting the property’s current depreciation.  Ultimately, this could result in the downfall of the decades-old base year assessment, as the County finds it necessary to update assessments for a larger number of properties.

A number of questions remain unanswered by the Court’s ruling.  How should properties be valued in areas that were rural in 1983 but are now highly developed?  How can appreciation and depreciation be quantified and reconciled?  Future cases will need to resolve these questions, but for now, owners of Delaware property should evaluate their portfolios and determine whether opportunities exist to improve profitability by reducing property taxes.

Benjamin A. Blair
Faegre Baker Daniels LLP
American Property Tax Counsel (APTC)

UPDATED june 2020

Higher Property Tax Bills in November Won’t Reflect Current Reality for Commercial Property Owners

Although property tax bills for 2020 don’t come out until November, and the preliminary notices of assessment will not be mailed to owners until August, County Property Appraisers have finished setting 2020 assessment values and submitted their tax rolls to the Department of Revenue for final approval.  Unfortunately, most Property Appraiser’s Offices which we have contacted are taking the position that since the effects of COVID happened after January 1st, and Florida’s lien date is January 1st, they do not need to recognize the economic downturn which has impacted most sections of the economy.

In Miami-Dade County, the total tax roll is up 2% before factoring in new construction. With new construction, which was highest in Miami, Miami Beach, and unincorporated Miami-Dade County, the total tax roll is up 4.6%.  In Broward County, the total tax roll including new construction is up 6.1%, and in Palm Beach County it is up 5.5%.

In order for owners to obtain relief in 2020, it will be necessary to be proactive with appeals.  For those properties which were already hurting before COVID, the appeal must identify the forces which negatively impacted these businesses prior to COVID.  For other property types, it will be necessary to relate back the early reports of the pandemic to the lien date.  Appeals will require an individualized approach to challenging property values in 2020.

Julie Schwartz, Esq.
Rennert Vogel Mandler & Rodriguez, P.A.
American Property Tax Counsel (APTC)

UPDATED june 2020

Covid-19 and Property Tax Appeals

Georgia Supreme Court Chief Justice Harold D. Melton issued three 30 day statewide judicial emergency orders due to the coronavirus, but the deadline for filing property tax appeals has not changed. Property owners must timely file appeals of their assessment notices or will have no right to contest their tax bills.  Assessment notices are used in April/May/June with a deadline of 45 days from the date of issuance. If an assessors' office changes the assessment in response to an appeal, a new assessment notice is sent to the taxpayer which also must be timely appealed, or the change is final. Taxpayers should watch carefully for a supplemental change notice because the filing deadline is much shorter than the initial filing deadline. Simple errors in the appeal process can be costly.

Lisa F. Stuckey
Ragsdale, Beals, Seigler, Patterson & Gray, LLP.
American Property Tax Counsel (APTC)

Updated june 2020

Looking at Taxable Value Increase Limits

Employees of the Idaho State Tax Commission recently published an analysis of property tax value limits.* Idaho assessors must assess property at market value as of January 1 each year. Unlike some states, there is no cap on how much the value can increase each year. According to the article, this promotes transparency because caps on value mislead taxpayers. Lower taxable values give the illusion of lower taxes. “Taxpayers have nothing to appeal (i.e., their values will not exceed market value),” so they believe they are paying less than without the cap. Caps also place a greater burden on owners of properties whose values are not keeping pace with the increases contemplated by the cap. 

In 2006, Idaho considered adopting a cap. But no property tax changes are on the horizon now. Legislative work is likely done for 2020 (despite recent efforts of some legislators, backed by armed supporters, to convene a special session). And dropping market values makes limits of less interest now. The article, however, provides a thoughtful framework for evaluating proposals for value limits in the future. 

*Alan S. Dornfest, Kathlynn Ireland, and Mark Southard, Taxable Value Increase Limits – Revisited, Journal of Property Tax Assessment & Admin. 49 (Vol. 17, Issue 1).

Michelle DeLappe & Norman J. Bruns
Foster Garvey PC
American Property Tax Counsel (APTC)

Updated March 2015

The Story of Real Estate Taxes - 2015

Chicagoans should be wary about their 2015 Real Estate Tax Bills. Up to now, Chicago Taxpayers have fared much better than their suburban neighbors when it comes to real estate taxes. Tax Year 2015 may well mark the beginning of a “Perfect Tax Storm” in Chicago.

In 2015, all property lying within Chicago will be re-valued. It seems very clear that the Assessor has determined that the Great Recession has become an event of history and that most segments of the real estate market are well on the way to recovery.

Thus far, new valuation Notices have only been sent to the property owners in one of the eight townships that comprise the City of Chicago. We have been able to review the new values. On average, the assessed values in that township have increased approximately fifteen (15%) percent. Multi-family residential properties have increased beyond twenty (20%) percent, single family residences and condominiums have risen to triple digit increases in some cases. Based on what we have seen in the first townships, we have to forecast even greater increases for most of the other townships.

Real estate values are only one component in the calculation of real estate taxes. The other critical component is the Tax Rate. The Tax Rate is determined by dividing the total budgets of all the Municipal and County agencies which provide services to the public by the total taxable value of the service area. That will include school districts, police, fire, park districts and more.

In 2015 and 2016, the pension deficits of the City agencies are about to reach catastrophic proportions. The Mayor’s staff is looking to Real Estate Taxes to reduce these deficits.

A PERFECT TAX STORM!

James P. Regan
Fisk Kart Katz Regan & Levy, Ltd.
Telephone:  (312) 726-1833
American Property Tax Counsel (APTC)

UPDATED december 2019

Indiana Tax Court: Under The Income Approach, Fee Simple Interest Must Be Valued Based On Market Rents

Name:  Southlake Indiana LLC v. Lake County Assessor (the decision can be viewed here -- https://www.in.gov/judiciary/opinions/pdf/11251901mbw.pdf)

Date Issued:  November 25, 2019

Property Type:  Retail store

Assessment Years:  2007-2014  

Synopsis:  Taxpayer owns a 90,000 SF two-story, freestanding retail building in Northwestern Indiana, which it leased to a retailer doing business nationwide.  The property was encumbered by a build-to-suit lease, originally executed in 1992 and renewed in 2012. At the administrative hearing before the Indiana Board of Tax Review, the parties’ appraisals developed all three approaches to value but relied primarily on the income approach.  The Indiana Board’s final determination assigned no weight to the appraisers’ sales comparison and cost approaches.  The Tax Court explained, “To determine which appraiser’s estimate of market rent [under the income approach] was best supported, the Indiana Board used its own unique evaluation method.”  The Indiana Board examined 16 leases from the parties’ appraisers, made certain adjustments, and ultimately concluded that the market rents and income approach values offered by the Assessor’s appraiser were more credible.

Observing that Indiana assesses the value of real property – not business value, investment value, or the value of contractual rights – the Tax Court observed: “when valuing a property under the income approach, the fee simple interest in property must be valued based on an estimate of market rent, not contract rent.”  Comparable rental data, the Court further noted, must “represent freely negotiated, arm’s length transactions.” 

Assessor’s appraiser failed to adjust the rental data from the build-to-suit leases upon which his income approach relied.  Accordingly, those leases were not probative evidence of the market value of the subject property’s real property alone.  In contrast, the record evidence showed that Taxpayer’s appraiser exercised caution in using any build-to-suit rental data.  That the build-to-suit rental data “relied heavily on” by Assessor’s appraiser and the Indiana Board  “was neither adjusted nor explained as reflecting market rent” was contrary to law, the Court held. 

Finally, the Court explained that “no reasonable person reviewing the administrative record would find enough relevant evidence to support the Indiana Board’s reconstruction of [the Taxpayer’s Appraiser’s] percentage of gross sales analysis or its resulting conclusions.”  Therefore, the Indiana Board’s final determination also was unsupported by substantial or reliable evidence. 

The Tax Court reversed the final determination and ordered the Indiana Board to determine assessed values based, in part, on market rents derived by the analysis offered by the Appraiser for the Taxpayer. 

- The above facts and summary of the holding are based solely on the information presented in the published opinion issued by the Indiana Tax Court. 

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Faegre Baker Daniels LLP
American Property Tax Counsel (APTC)

Declining To Reweigh The Evidence, Indiana Tax Court Affirms Assessments Of CVS Store Based On Cost Approach

Name: CVS Corporation v. Elkhart County Assessor (can be accessed at
https://www.in.gov/judiciary/opinions/pdf/12091901mbw.pdf)

Date Issued: December 9, 2019

Property Type: Retail pharmacy

Assessment Years: 2012 – 2015

Point of Interest: Indiana Tax Court would not reweigh the record evidence, which supported the Indiana Board of Tax Review’s conclusion of value based solely on the cost approach without adjustment for external obsolescence.

Synopsis: CVS challenged the assessments of its nearly 11,000 SF retail pharmacy, built in 2004 and situated on 1.26 acres of land. The County Assessor had valued the property at a range of approximately $1 Million to $1.1 Million for the four contested assessment dates. At the consolidated administrative hearing before the Indiana Board of Tax Review, both parties presented USPAP-compliant appraisals; both appraisers applied all three approaches to value but assigned weight to them differently. For CVS, its appraiser gave most weight to the sales and income approaches, concluding to a range of $800,000 to $890,000. For the Assessor, her appraiser assigned equal weight to each of the three approaches, opining on a value for each year of about $1.8 Million.

The Indiana Board applied the cost approach, without obsolescence. The Indiana Board concluded that the cost approach – absent any adjustment for economic obsolescence – was the most persuasive indication of value for this eight- to eleven-year-old store. The Indiana Board disregarded both appraisers’ sales and income approaches completely, finding them too flawed, and concluded to values of more than $1.2 Million for each year.

The Court will not reweigh the evidence. The Tax Court noted that the Indiana Board is “required to adopt a value based exclusively on evidence in the administrative record,” but it is not obligated to “adopt the same weight afforded to the evidence” that the appraisers applied in their respective reports. The Court further explained that the record evidence supported the Indiana Board’s rejection of external obsolescence. The appraiser for CVS had testified in “vague generalities” about the subject property’s “softer market.” The Assessor’s appraiser, however, presented evidence regarding growth in population, employment and gross domestic product in the local area during the years at issue. CVS was asking the Court to reweigh the record evidence in its favor, something the Court cannot do “absent a showing that the Indiana Board has abused its discretion.” Concluding that the Indiana Board had acted within its statutory authority, the Court affirmed the final determination.

This email address is being protected from spambots. You need JavaScript enabled to view it., Esq.
Faegre Baker Daniels LLP
American Property Tax Counsel (APTC)

Indiana Tax Court Affirms Assessment of Vacant Lot Based on Appraisal and Testimony of the Appraiser

Name:  Sheerin v. LaPorte County Assessor (which can be viewed at https://www.in.gov/judiciary/opinions/pdf/12111901tgf.pdf)

Date Issued:  December 11, 2019

Property Type:   Vacant lot

Assessment Year:  2015

Point of Interest:  Appraisal offered by Assessor had minor flaws but sufficiently established a prima facie case supporting the assessed value of a vacant lot. Relying on the appraisal and the appraiser’s testimony, the Indiana Board of Tax review did not abuse its discretion in affirming the assessed value.

Synopsis:  A 6,000 SF rectangular vacant lot, which was zoned residential, was “buildable,” but several issues would make any construction more costly than normal, i.e. it had a “severe slope,” a lack of rear access, the need for septic installation, and a proximity to overhead power lines. Though the County Board had reduced the assessment from $220,000 to $132,000, Owner appealed to the Indiana Board of Tax Review.

Before the Indiana Board, Assessor had the burden of proof. Assessor engaged an appraiser who, relying on sales of three vacant lots, estimated the property’s vale at $160,000 as of January 1, 2015. Owner challenged the comparability of the three sales and claimed the appraiser made other errors. The Indiana Board affirmed the $132,000 assessment despite “minor flaws” in the appraisal, ruling the Assessor had made a prima facie case supporting the property’s assessment, which Owner failed to rebut with probative, market evidence. Assessor had not asked for an increase in the lot’s value.

Before the Tax Court, Owner repeated his arguments from the administrative appeal and asserted that the Indiana Board improperly deferred to the “perfidious” appraisal offered by the Assessor. The Tax Court observed, “When, as here, the Indiana Board determines the evidence presented at the administrative level has probative value, the Court will not reverse its determination that a litigant made a prima facie case absent an abuse of discretion.” Here, the Indiana Board concluded that the appraisal, despite its problems, and the appraiser’s testimony “provided a sufficient explanation of the methods and information used to derive the estimate of value.” Owner did not establish that the Indiana Board had abused its discretion because its final determination “comports with the law and is supported by substantial evidence.” The Tax Court affirmed the Indiana Board’s ruling.

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Faegre Baker Daniels LLP
American Property Tax Counsel (APTC)

UPDATED March 2019

The Time to Negotiate Iowa Property Tax Assessments is Now

On April 1, 2019, assessors around the state of Iowa will release their property tax assessment values.  This starts the clock for negotiations.

Pursuant to Iowa Code § 441.30, from April 2 until April 25, aggrieved taxpayers may contact local assessors and make an informal request that the assessment be changed.  This can result in a written agreement with the assessor to correct or modify the assessment, or an agreement by the assessor to file a recommendation with the local board of review that the assessment be changed.  Assessors around Iowa take this period seriously.  The time to consider negotiations is now.

Here is a brief overview of the Iowa appeal deadlines:

• January 1 – Assessment date (Iowa Code § 441.46)
• April 1 – Assessor’s release assessment values (Iowa Code § 441.23)
• April 2-25 – Time to negotiate with assessors (Iowa Code § 441.30)
• April 30 – Iowa Board of Review protests due (Iowa Code § 441.37)
• Later date of May 31 or 20 days after board of review opinion – Deadline to file appeal with PAAB or district court (Iowa Code §§ 441.37A, 441.37B, 441.38)

This email address is being protected from spambots. You need JavaScript enabled to view it. and Elizabeth Carter
Faegre Baker Daniels LLP
American Property Tax Counsel (APTC)

Updated september 2019

Kansas Board of Tax Appeals rejects Korpacz /IAAO methodology for Big-Box Retail Properties

The Kansas Board of Tax Appeals recently issued a decision in various tax appeals for Walmart stores located in Johnson County, Kansas. 

 The County hired Peter Korpacz, MAI, and Bliss & Associates to appraise the properties.  The County also hired Dr. Tom Hamilton, MAI,  to join Korpacz in advocating for the new IAAO method of valuing the illegitimate “fee simple subject to a lease”.  

The properties were owner-occupied but Korpacz valued the property ‘as if leased to Walmart with 20 years left on a lease’.  He utilized the sales comparison and income approaches to value the properties and relied on sale leaseback and build-to-suit comparables for both approaches.   The taxpayer’s expert, Gerald Maier, MAI, excluded build-to-suit and sale leaseback comparables to value the property in fee simple. 

 The Board ruled that the County’s methodology was contrary to Kansas law, which prohibits the use of build-to-suit comparables without proper appraisal adjustments to limit the value attributable to the leased fee interest.  The Board reaffirmed Kansas is a fee simple state and not a leased fee state. 

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Property Tax Law Group, LLC
American Property Tax Counsel (APTC)

UPDATED march 2020

Kentucky Extends Property Tax Calendar

In light of the ongoing COVID-19 State of Emergency declared by Governor Beshear, and the effect of the State of Emergency on the operations of state and local government offices, the Kentucky Department of Revenue has taken a number of steps to extend the 2020 property tax calendar.

Personal property tax returns, originally due by May 15th, are now due by July 15th.

For real property, the tax roll inspection period (appeal period), originally scheduled to run from May 4 - 20, will now run from July 6 - 20.  Property valuation administrators are allowed to start their inspection periods before July 6th, but the inspection period cannot close before July 20th.  While the real property tax appeal period will be compressed, the counties plan to send out tax bills on the regular schedule (November and December).

Kentucky law does not provide any type of relief on property valuations for catastrophes or disasters.  Given the January 1st lien date, current policy is that a taxpayer will not be granted valuation relief for 2020 due to COVID-19, but that any diminution in value will be considered for 2021.  This policy is subject to change, although that is unlikely unless Kentucky's legislature provides some emergency relief.

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Morgan Pottinger McGarvey
American Property Tax Counsel (APTC)

Updated june 2020

Louisiana's Catastrophe Statutes

Like most states, Louisiana has gone through phases of lockdown and reopening due to COVID-19. Our governor also extended filing deadlines for property tax renditions numerous times, but eventually the question will have to be asked: how has all of this affected property tax values? The general rule in Louisiana is that assessments are based on the condition of property on January 1 each year (August 1 in Orleans Parish). However, La. R.S. 47:1978.1, which was enacted after the late summer/fall devastation of Hurricane Katrina in 2005, provides that:

[i]f lands or property, including buildings, structures, or personal property, are damaged, destroyed, non-operational, or uninhabitable due to an emergency declared by the governor or to a disaster or fire, the assessor or assessors within such parish shall assess such lands or property for the year in which damage has occurred at the percentage of fair market value provided in the Constitution of Louisiana by taking into consideration all the damages to the lands or other property, including obsolescence, and the depreciation of the value of such land or other property caused by the disaster, fire, or emergency.

Thus, when the governor declares a public emergency, any property that is (1) damaged, (2) destroyed, (3) nonoperational, or (4) uninhabitable as a result of the emergency is entitled to reassessment regardless of when the public emergency occurred.

The Louisiana Tax Commission has confirmed that La. R.S. 47:1978.1 applies to property affected by COVID-19. However, it has not specified the type of information that must be provided to assessors to substantiate any COVID-19 reduction in value. Some suggestions: financial statements, profit and loss statements, revenue and expense information, and sales information, preferably presented in year-over-year/month-over-month format for easy (and irrefutable) comparison.

Additionally, taxpayers may request a hardship deferral that allows for a short-term delay in making property tax payments under La. R.S. 47:3702.  

Angela W. Adolph
Kean Miller LLP
American Property Tax Counsel (APTC)

PILOT Gets A Second Chance

Louisiana has long relied on its Industrial Tax Exemption Program ("ITEP") as an economic development engine for manufacturing.  Several years ago, a coalition of industry associations promoted Payments In Lieu of Taxes ("PILOT") as an alternative to ITEP to create greater flexibility in assessments of manufacturing facilities.   After getting no traction for years, the legislation finally passed this year (Act 370).  Essentially, the legislation creates a new classification of exempt property and allows taxing jurisdictions and taxpayers to negotiate PILOT on that exempt property.  The legislation requires an amendment to the Louisiana Constitution, which proposal will be on the November 3 ballot.  

Angela W. Adolph
Kean Miller LLP
American Property Tax Counsel (APTC)

Updated December 2014

Ignoring The Assessor's Inquiries Can Be Fatal To Your Appeal

In Maine the assessor may require the taxpayer to answer in writing all proper inquires as to the nature, situation, and value of the taxpayer's property liable to be taxed. This request can include income, expenses, manufacturing or generational efficiencies, manufactured or generated sale price trends, or other related information. A taxpayer has thirty days to respond to the inquiring. Upon written request a taxpayer has an automatic thirty day extension to respond to the inquiring. The failure to supply the information will bar the taxpayer the right of appeal. Please be aware that some assessors use this provision of the law to inundate the taxpayer with inquires. The property of some of these inquires is questionable and some inquires appear to be patently improper. These inquires can be a cynical attempt to have the taxpayer's appeal dismissed for failing to comply with an inquiry.

David G. Saliba
Saliba & Saliba
American Property Tax Counsel (APTC)

UPDATED September 2019

Upcoming 2020 Reassessment and Mid-Cycle Appeal Deadline

Major markets in Maryland set to be reassessed as of 1/1/2020 are Bethesda & Chevy Chase (Montgomery County), Laurel & Bowie (Prince George’s County), Hanover & the BWI Airport area (Anne Arundel County), Mount Vernon & Midtown (Baltimore City) and Towson (Baltimore County).  Even if your property is not set to be reassessed, a mid-cycle appeal can be filed.  It must be noted by January 2, 2020.  Please contact Wilkes Artis to review your property to determine if a mid-cycle appeal is warranted.   

Kevin E. Kozlowski, Esq.
Wilkes Artis, Chartered
American Property Tax Counsel (APTC)

UPDATED march 2020

Devaluation of Real Estate Due to the Covid-19 Virus

As of March 2020, the COVID-19 pandemic has caused a serious disruption in many businesses. Some businesses have shut their doors, and some will never reopen. It is unknown how long the crisis will continue. This leaves property owners in a poor position to pay mortgages, employees, and other bills. In Massachusetts the assessing date is January 1. The next tax bill issued will be for Fiscal Year 2021. That tax bill has an assessing date of January 1, 2020. A problem for property owners is that on January 1, 2020 in general the economy was doing well. Notwithstanding the disconnect between the assessing date and the timing of the COVID-19 pandemic it would be prudent for property owners to file for an abatement for Fiscal Year 2021. Many assessors will want to deal with this obviously serious problem sooner rather than later.

David G. Saliba
Saliba & Saliba
American Property Tax Counsel (APTC)

UPDATED june 2020

Michigan Extends 2020 Property Tax Appeal Deadline

Due to the challenges property taxpayers faced as the pandemic took hold, Honigman’s Tax Appeal Group sought legislation to provide additional time for filing 2020 tax appeals.  That effort successfully ended on June 11, when Michigan House Bill 5766 became Public Act 88 of 2020, and August 31 became the State’s new property tax appeal deadline for the current 2020 tax year.

Honigman convincingly argued to legislators in Lansing that without the extension of the filing deadline, due to the pandemic and government office closures, taxpayers would be deprived of fundamental fairness and due process.  Legislators agreed.  The bill passed unanimously in both the Michigan House and the Michigan Senate, and it was signed into law by the Governor on June 11.  With this additional time, taxpayers can now take a holistic approach and carefully evaluate their 2020 Michigan property taxation.

Stewart Mandell
Honigman LLP
American Property Tax Counsel (APTC)

Updated june 2020

Coping with COVID and Civil Unrest

The times we live in are challenging for everyone, and commercial property owners are not being spared.  Many retail properties were closed for months, and the hospitality industry has been ravaged.  Office employees have been working from home, and many in the industry suspect that office use by corporations, law firms, and other traditional users of such space will change forever. 

The financial pressures on properties are real, and have been recognized by many Minnesota counties that extended payment deadlines for first half 2020 tax payments by forgiving penalties.  Assessing jurisdictions are also reaching out to property owners who may qualify for disaster relief because structures were significantly damaged in the Twin Cities’ recent civil unrest following the death of George Floyd in Minneapolis police custody.

The issue for many owners is whether assessing jurisdictions can react quickly enough to the distress to afford meaningful tax relief.  Taxpayers may face valuation analyses by assessors that bear no relationship to the changed circumstances 2020 has brought.  It’s more imperative than ever that the financial realities faced by owners be shared with assessors so that properties can survive the turmoil.

Mark Maher
Smith, Gendler, Shiell, Sheff, Ford & Maher
American Property Tax Counsel (APTC)

Updated June 2016

Personal Property Statute

On August 28, 2015 the Missouri Legislature enacted Section 137.122.1 which requires county assessors to apply the “standardized schedule of depreciation” to determine assessed value of personal property which will be “presumed to be correct.”

Owners may challenge the assessment by presenting substantial and persuasive evidence of value.

It appears many county assessors are resisting using the depreciation concept in setting assessed value. Only time will tell how this plays out.

Jerome Wallach
The Wallach Law Firm
American Property Tax Counsel (APTC)

Updated june 2020

Nevada property tax bills and the effect of the coronavirus

Tax bills for fiscal year 2020-21 will be issued in July of 2020.  The values on which those bills are based were issued by the assessors in December of 2019 and the time to appeal those values ran in January of 2020 – before the impact of the coronavirus epidemic was evident.  There is no provision that allows property owners to now challenge the taxable values for tax year 2020-21 based on the intervening impact of the coronavirus epidemic. 

The taxable values for tax year 2021-22 will be issued by the assessors in early December of 2020.  Those values will need to be critically reviewed to ensure they reflect the loss of value resulting from changed market conditions caused by the coronavirus epidemic and the resulting closure of businesses.  If those values do not adequately account for the affect the epidemic has had on market value, the values can be challenged by appealing to the county board of equalization.  The deadline for filing an appeal is January 15, 2021.

Our property tax attorneys know the critical legal and valuation factors that affect the tax treatment of property in Nevada and are prepared to assist property tax owners in evaluating and , when appropriate, challenging that tax treatment.

Paul D. Bancroft
McDonald Carano
American Property Tax Counsel (APTC)

Updated march 2020

Corona Virus Decreases Real Estate Values

As of March 2020, The Corona Virus also known as the COVID-19 pandemic has caused serious disruption to the real estate market. In some cases, businesses have closed completely, and some may never open again. Some tenants find it impossible to pay rent. Some landlords cannot make mortgage payments. In New Hampshire the assessing date is April 1, 2020 which is directly in the cross hairs of this horrific pandemic. The filing deadline for Tax Year 2020 is generally March 1, 2021. If your property value has been negatively affected by the pandemic it would be prudent to file an abatement application before March 1, 2021. The application should among other things alleged a reduced market value because of the pandemic. Proving and quantifying the disruption in market value may prove difficult. So often trying to prove and quntify a self-evident reality can prove to be oddly vexing.

David G. Saliba
Saliba & Saliba
American Property Tax Counsel (APTC)

Updated MARCH 2019

New Jersey Tax Court Analyzes Freeze Act Invocation and Waiver

A recent New Jersey Tax Court opinion analyzed whether a tax payer waived N.J.S.A. § 54:51A-8 (“Freeze Act”) protections pursuant to a settlement agreement that expressly invoked Freeze Act application only for the freeze year immediately following the appealed tax year. In 160 Chubb Properties, LLC v. Township of Lyndhurst, the Tax Court held that the taxpayer did not waive Freeze Act application to the second freeze year because Freeze Act protections must be deliberately and intentionally waived. Although the settlement agreement invoked Freeze Act protections for the first freeze year, the agreement did not expressly mention the waiver of application to the second freeze year. Importantly, the Freeze Act is self-executing, thus, invocation is not necessary for its application. Without any indication that the taxpayer requested or agreed to waive Freeze Act protection rights, application to both freeze years was enforceable. 160 Chubb Properties, LLC v. Township of Lyndhurst, 30 N.J. Tax 613, 624-25 (N.J. Tax Ct. 2018).

Gregory S. Schaffer, Esq.
Garippa, Lotz & Giannuario P.C.
American Property Tax Counsel (APTC)

Updated September 2018

Expanding the Workforce in Construction: Inclusive Initiatives for Women and Minorities Proves Critical for Ever‐Evolving NYC Construction Industry

New York City represents the best of real estate development on a global spectrum. From the record-breaking economic sales, to record-breaking building heights, the complexity and success of this industry rests on the shoulders of its committed, dynamic, knowledgeable, and diverse workforce.

This workforce is made up of many roles – developers, architects, legal counsel, and construction personnel. Take a stroll through any New York City street and you will undoubtedly witness a construction site underway. The hammering, demolition, concrete mixing, safety signaling, and drilling make up the musical medleys that fill the every-day tunes this magical City is best known for.

For that reason, it’s imperative that the construction workforce advance and grow. One initiative that has gained momentum and added a dynamic impact to the construction world is the growing rate of women-owned construction firms and women construction workers on-site. The construction world has been predominately male-oriented, but the inclusion of women in the workforce has only strengthened the industry and given it a greater edge.

Marcus & Pollack LLP, a leading real estate tax firm in New York City, has recognized this trend. Recently, Marcus & Pollack created a new department specifically tailored to assist women and minority owned business in the bidding and contract award process on major construction projects throughout New York City.  Marcus & Pollack LLP works hand-in-hand with leading developers to include women owned business on their job-sites at every level – from general contractors and construction managers to all lower-tiered trades.

Marcus & Pollack LLP can be the catalyst in bringing significant numbers of women and minority owned businesses and construction labor into the bidding and contract award process. Marcus& Pollack LLP’s involvement and representation of many of the owners and developers involved in new construction projects enables the initiative to be established and pursued at the very early stages of planning and project development.

As advisors in property tax aspects and tax incentive programs, Marcus & Pollack LLP advocates the inclusion of minority and women owned firms on construction sites by counseling clients to include at least three minority and/or women owned companies in every request for proposal or construction labor throughout the project. The initiative has been widely accepted and implemented.   

Further, women and minority owned firms and construction workers are also given access to Marcus & Pollack’s database of on-going, active construction sites looking to hire. By matching these minority and women owned firms or construction labor to projects currently underway throughout New York City, the overall construction schedule is helped to steadily progress because construction needs are being met by an able, capable, and dynamic workforce.

For more information, please contact Joel Marcus or Kristine Loffredo at This email address is being protected from spambots. You need JavaScript enabled to view it. or (212) 490-2900.

Joel R. Marcus
Marcus & Pollack LLP
American Property Tax Counsel (APTC)

Updated December 2002

Hijacking the Assessment Review Process 

New York consistently ranks as one of the highest taxed states in the nation, and local property taxes are 79 percent higher than the national average. Boards of Assessment Review face high rates of complaints and increased pressure by the local governing body to control refund liability.

The evidentiary demands of many Boards have escalated sharply and many initiatives have been criticized as mere attempts by the local governing body to deliberately discourage taxpayers from exercising their right to seek a fair assessment, in conflict with the spirit of New York's Real Property Tax Law.

Perhaps the most flagrant attempt to hijack the review process as a tool to curtail the property owner's right to a fair assessment is found in a recently proposed local law by the new Nassau County Executive. The controversial proposed law requires only commercial property owners who file appeals of their property's assessments to submit a certified appraisal as a condition precedent to reducing an assessment. In the alternative, owners may submit a "bona fide" counteroffer - defined as no less then 85 percent of the County's assessment, or withdraw the appeal altogether. Owners who fail to exercise one of the above options forfeit their right to judicial review and are subject to a $5,000 fine.

Nassau County spends approximately $150 million annually to pay down a $1.1 billion debt from past tax refunds even as taxpayers file more than 100,000 protests annually. More than 80 percent of the annual refund liability goes to commercial property owners. The proposed law by the new County Executive seeks to punish commercial property owners for exercising their constitutional right to a fair assessment and equitable tax burden.

The controversial law must be codified by the Nassau County Legislature as well as the New York State Legislature, which must issue a "home rule" message to authorize the change. However, State Senator Craig Johnson (D-Port Washington) has rejected the County Executive's request to introduce the state legislation, citing concerns that the legislation would be unfair to commercial property owners and was unconstitutional on its face. Of the many concerns with the proposed law, it was rejected by Sen. Johnson because it is punitive and bullies commercial property owners to settle within a 15 percent margin that deprives the owner of the right to a fair assessment and an opportunity to be heard.

Michael Martone
Koeppel Martone & Leistman, L.L.P.
American Property Tax Counsel (APTC)

Updated September 2015

North Carolina

The North Carolina General Assembly has enacted legislation which exempts from property tax the increase in the value of real property held for sale by a builder. Effective for tax years beginning January 1, 2016, and applicable to improvements made after July 1, 2015, improvements to single family or duplex residential real property held for sale by builders and commercial real property held for sale by builders are excluded from taxation as long as the property is held for sale. Applications for exclusion must be filed annually.

Charles B. Neely, Jr.
Nancy S. Rendleman
Williams Mullen
American Property Tax Counsel (APTC)

UPDATED june 2020

Tenant Complaint Filing in Ohio

Siegel Jennings’ efforts to ensure fair property taxation for all Ohio taxpayers include an active role in the Ohio legislative process itself.  On May 12, 2020, Managing Partner Kieran Jennings appeared before the Ohio Ways and Means Committee in support of an amendment to Ohio Revised Code 5715.19(A)(1), which would permit a tenant who is wholly responsible for the property tax liability of a leased property to file a valuation complaint in its own name.

5715.19 regulates who may file a complaint against the valuation of real estate in Ohio.  In its current form, the language of the statute makes it necessary for a tenant to file a valuation complaint in the name of the owner of the property.  However, the owner of a property where a tenant pays 100% of the property taxes often has little interest in committing time to the valuation complaint process. The true litigant in these situations is the tenant.

The current law’s shortcomings are highlighted during the discovery process on appeal.  Once a decision is appealed to the next level of review, the parties can issue and compel discovery.  Often, discovery issued by opposing parties is directed to the owner and includes requests for information not available to the tenant.  These requests do not always seek information relevant to the fee simple as if unencumbered value of the real property.  Should a tenant receive discovery it cannot answer, such as a question about a sale or a recent financing appraisal, its entire litigation position may be jeopardized.  Unanswered discovery may result in motions to compel.  Motions to compel may include monetary penalties, and even more damaging, evidentiary restrictions that handicap the tenant’s ability to pursue its case.  A tenant who is 100% responsible or the property taxes, and is the true litigant, may be denied due process because it is not in the possession of the information requested.

Property owners with tenants 100% responsible for paying property tax bills often have limited knowledge of the day-to-day operations of their properties.  They are often unable to answer condition questions, may not have familiarity with the markets in which their properties are located and frequently cannot offer much information relevant to the fee simple value of their parcels.  They focus more on collecting rent, and frequently do so from locations outside the state or even the country.  Conversely, the tenant has boots on the ground, knows the bulk of information relevant to the property’s value and has a vested interest in all tax implications. 

Adopting the proposed amendment, as discussed by Mr. Jennings, would clarify language of the statute never intended to exclude a relevant party to the litigation.  It would provide the most interested party – the taxpayer – the ability to fully advocate for and defend its position.  It would ensure due process to tenants already most impacted by the fee simple value of the properties they rent.  Importantly, these changes would not serve to extinguish owner’s rights to participate in Ohio tax litigation matters for their properties but would serve to include the correct parties for properties where the responsibility for taxes is wholly the tenants, who have the most information and are the most impacted by the results.

Kristopher Nicoloff
Siegel Jennings Co. L.P.A.
American Property Tax Counsel (APTC)

UPDATED march 2020

Changes to Deadlines Due to COVID-19

On March 27, 2020, the Supreme Court of Oklahoma issued an order that closed all 77 county courthouses, cancelled all jury terms and suspended all deadlines and procedures through May 15, 2020. Aside from matters that can be worked on by agreement, all District Court and Appellate Court tax cases are on hold until May 15th. The Supreme Court is expected to issue further directives in the near future.

Additionally, on March 24, 2020, Oklahoma Governor Kevin Stitt and State Auditor Cindy Byrd made a “recommendation” that all Oklahoma county treasurers extend the second half ad valorem tax payment deadlines from March 31st to April 30, 2020. In this request, the Governor and State Auditor cited 68 O.S. § 2913(G), which states the “county treasurers may waive penalties and interest in any case” where the failure to timely remit was due “through no fault of the taxpayer.” Since Governor Stitt’s recommendation, the Oklahoma County Treasurer and most treasurers across Oklahoma have stated they will not charge penalties and interest for late property tax payments until April 30, 2020.

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Elias, Books, Brown & Nelson, P.C.
American Property Tax Counsel (APTC)

UPDATED march 2020

Property Tax Relief Not Expected for 2020

Effective March 23, 2020 Governor Kate Brown issued a stay at home order for Oregonians and shuttered all non-essential business including restaurants, malls and business. The effect on business, and in turn property values will be significant. What property tax relief will be forth coming from the assessor or the Department of Revenue is yet to be known. However, because assessments relate back to January 1 of each tax year and the test is what was known or knowable as of the assessment date, we are not holding our breath. While the COVID-19 virus is a reality in 2020, as of January 1 it had not swept through the United States and been declared a pandemic. Oregon has a statutory provision for property that has been destroyed or damaged that allows a proration or reduction in assessment. ORS 308.425. Unfortunately, it does not address proration of property assessment when there is a catastrophic event. There may be some relief for some properties that were already seeing a decline in property values due to other economic obsolescence events. Additionally, the legislature may be imposed on to provide some relief, particularly when it comes to enterprise zones that require a business to maintain a set number of employees and to remain in operation. The central assessment roll will come out in May and locally assessed property will be valued by June 30. So, we are in a holding pattern and we will continue to explore for means to secure relief for over assessed property. 

Oregon property tax statements for real and personal property are required by statute to be mailed by October 25, 2020 for locally assessed property. Taxpayers who believe their property has been improperly assessed must file their appeal by December 31, 2020 to preserve their statutory rights of appeal. When reviewing the tax statement, review the real market value and the assessed values of the property. The assessor calculates a real market value for both the land and improvements for the current tax year and the previous tax year. The assessed value may be less than the total real market value, but it may not be more. This is because Ballot Measure 50 (ORS 308.142 et seq.) requires the assessor to calculate both the real market value and the maximum assessed value. The lesser of the two values is the assessed value and the value upon which taxes are paid. If the assessed value is less than the real market value, generally the real market value has no effect upon the property taxes you pay. This is because a property’s maximum assessed value may only increase by three percent.

Cynthia M. Fraser
Foster Garvey PC
American Property Tax Counsel (APTC)

UPDATED June 2020

Pennsylvania Taxpayers Uniquely Positioned to Argue Now for Value Reducations Based on COVID 19 Impact

Pennsylvania property owners who have been financially impacted by the pandemic should act now to evaluate and potentially request relief on their property taxes.

With respect to the impact of the COVID 19 pandemic, owners in Pennsylvania have an advantage over most other states because the date on which the market value for an appeal is based—known as the “effective date of value”—is earlier than in other states. In Pennsylvania, the effective date of value is:

• For Allegheny County, PA – March 31, 2020
• For Philadelphia County, PA – the first Monday in October (October 5, 2020)
• For all other 65 PA Counties – Between August 1, 2020 and September 1, 2020 (we recommend filing before August)

By comparison, in nearly every other state, the effective date of value is either January 1, 2020 (at which point, the impact of the pandemic was largely unknown in the market) or January 1, 2021 (at which point assessors will likely argue that the effect of the pandemic is already behind us).  Assessors in other states are already pushing back against requests for property assessment reductions based on arguments of what was known on those dates.

Thus, Pennsylvania property owners are uniquely positioned to use information about the effect of the pandemic to seek a reduction in property taxes.  For 65 of Pennsylvania’s 67 counties, the operative question in seeking to reduce your property taxes will be:  “What would someone pay for my property on August 1, 2020 based on what information was known in the market?”

Reducing your property taxes will require appealing your assessment; winning that appeal will require evidence of your property’s market value. Therefore, appraisals used to support assessment appeals filed in Pennsylvania this year should incorporate the impacts of the COVID-19 crisis.

Hotel operators in particular should evaluate the potential to reduce their property taxes this year. Even in a typical year, valuation of hotels presents a unique appraisal problem that requires a specialized appraisal expertise.  For this year, the expectation is that the impact of the current crisis will impair hotels’ real estate values in most cases.  Further, as market participants in some sectors are looking to the 2009 financial crisis as a point of reference, there seems to be general agreement that demand for hotel rooms will be slower to return this time around.  This unknown timeline increases the risk to potential investors, further driving down property values.   

Now is the time to start collecting the data and documents that will be necessary to evaluate your property’s assessment to see if there is an opportunity to reduce your real estate taxes.  Owners should gather three years of income and expense statements, a current balance sheet, and a recent monthly STAR Report. In addition, STAR Reports from 2018 and 2019 will be helpful to compare and estimate the impact of the pandemic on 2020 performance.

If you believe the value of your property may be diminished by the COVID-19 crisis, please contact us before July so that you can properly evaluate the opportunity to reduce your property taxes with adequate time to prepare a winning case.

To discuss the specifics of an appeal and the valuation of your property, please contact Siegel Jennings at:

Sharon F. DiPaolo, Esquire
Brendan Kelly, Esquire
Siegel Jennings, Co., L.P.A.
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American Property Tax Counsel (APTC)

Updated june 2020

Rhode Island Property Tax Bills Have Been Sent

In Rhode Island, the property tax bills for the Tax Year 2020 have been sent. The assessing date for Tax Year 2020 is December 31, 2019. The filing for an appeal with the local assessor is due within ninety days after the date the first installment of the tax is due. In the past the burden was upon the taxpayer to prove value in the tax year of revaluation which is commonly known as the base year. Some judges are now interpreting the law that the value must be proved for the tax year in which the property tax appeal is field e.g. Tax Year 2020 the value as of December 31, 2019, regardless of whehter or not it was a revaluation year. In order to be safe, it may be advisable to prove value in both the tax year of revaluation (base year) and the tax year appealed.

David G. Saliba
Saliba & Saliba
American Property Tax Counsel (APTC)

Updated June 2011

South Carolina Enacts New Point of Sale Law

On June 14, 2011, Governor Nikki Haley signed a new law significantly amending South Carolina's controversial "point of sale" law requiring tax reassessment of properties whenever a sale has occurred. The prior law adopted in 2006, commonly known as "Act 388," placed a fifteen (15%) percent cap on reassessed values as part of the five (5) year countywide reassessment programs but sought to make up for the loss of revenue by requiring that properties be reassessed whenever there is a change of ownership.

Many in the commercial real estate market had expressed that Act 388 placed buyers of commercial properties at a significant competitive disadvantage with competitive properties whose property taxes had not increased. The new law, which does not apply to owner occupied residential properties, creates an exemption equal to twenty-five (25%) percent of any increase in valuation resulting from a change in ownership. The exemption does not permit a reduction in market value below the prior assessed value.

The new legislation leaves several important legal arguments unresolved, most notably the date of valuation for property owners whose properties have decreased in value during the middle of the countywide reassessment cycle. Although the current law calculates property taxes based on the state of the property as of December 31st of the prior year, the South Carolina Attorney General's Office issued an advisory opinion in June 2010 stating that the valuation for any mid-cycle appeal was to refer back to date of the last countywide reassessment. Many South Carolina counties are not adhering to this advisory opinion. The new legislation does not address this issue.

Morris A. Ellison
William T. Dawson
Womble Carlyle
American Property Tax Counsel (APTC)

UPDATED June 2020

The Importance of Proper Representation

Many taxpayers ask their property tax attorneys to take over appeals after an unsuccessful hearing with the county board of equalization.  

In one recent case, an unrepresented taxpayer introduced into evidence excerpts from an appraisal report, but failed to provide the entire appraisal or have the appraiser appear for cross examination.  In his decision, the administrative judge reluctantly affirmed the assessor’s value, while stating that “additional evidence could possibly support a significant reduction in value.”  In other words, the taxpayer’s property warranted a reduction in value, but the evidence was not properly presented.  Unfortunately, the taxpayer did not timely appeal further, and the case was not preserved.

Taxpayers should engage counsel early in the process when seeking a property tax reduction, because there are many pitfalls in the appeal process that can deprive them of the tax savings they deserve.

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Evans Petree PC
American Property Tax Counsel (APTC)

Updated June 2020

APTC Texas Update

The impact of Covid has been felt all across the world.  The property tax system is no exception.  The following are some observations from Texas.

• · Covid and 2020 Valuations: For property tax purposes, the valuation date is “as of” January 1 of each tax year. Thus, despite the devastation caused by Covid, its ruinous effects on businesses may not be considered for 2020 property valuations.

• · Section 11.35 Temporary Disaster Exemption: Governor Greg Abbott has declared the entire state a disaster area.  Section 11.35 of the Texas Property Tax Code provides for a temporary ad valorem tax exemption for property damaged in a disaster.  The applicability of the exemption in the context of Covid, however, has been called into doubt.  In AG Opinion KP-0299, Attorney General Ken Paxton concluded that the exemption does not apply to economic loss caused by the pandemic, reasoning that physical damage to property is required.

• · Alternative Hearing Procedures: Appraisal Review Boards are responding to social distancing needs by utilizing various types of formal hearings, such as hearings by telephone and video conference.  These appear to comply with due process requirements.  Interestingly, Attorney General Paxton recently opined on these alternative hearing types in AG Opinion KP-0307, ultimately concluding that a taxpayer is entitled to an in-person hearing if it insists on one.  Many counties, including several large ones, are currently holding in-person hearings.   Overall, the hearing process is working effectively, albeit slowly.

• · Tax Rate Caps: Recent legislation caps ad valorem tax rate increases by cities, counties, and large special districts at 3.5%, unless otherwise approved by voters. This limit, however, does not apply to taxing units located in a Governor-declared disaster area.  Controversy is brewing over whether this cap applies in light of Covid.  Governor Abbott argues that it does, while many taxing units contend that his disaster declaration removes the cap.  More to come.

• · Rolling 2019 Values: Some taxing units and taxpayers contend that rising appraised values, and thus property tax increases, may be avoided in tax year 2020 by using 2019 appraised values.  Because the valuation date is January 1, 2020 (not January 1, 2019), doing this may run counter to law, others argue.  The property tax burden is not increased by rising appraised values, but rather from the refusal of taxing units to lower tax rates in response. This sentiment was expressed by Governor Abbott, who remarked:

“To that end, I strongly encourage local governments to adopt property tax rates that will not result in an increase in the tax burden. This power is wholly within their control. As you know, local governments—not the State of Texas—set the property tax rates, and they are the ones responsible for an increase (or, ideally, decrease) in property taxes. The state, for example, took the unprecedented step last year in reducing school property tax rates, and requiring those rates to continue to decline as property values increase.”

Covid has undoubtedly disrupted the normal course of property tax administration in Texas.  Despite this disruption, the flexibility built into the state’s system has allowed it to adapt and work efficiently.

Jim Popp
Popp Hutcheson, PLLC
American Property Tax Counsel (APTC)

Updated march 2020

Possible Property Tax Relief Due To COVID-19 Pandemic

Owners of business properties in Utah may qualify for property tax relief as a result of the COVID-19 pandemic. 

Generally, Utah law requires property to be taxed at its fair market value as of January 1 each year.   Because COVID-19 had not impacted Utah communities as of January 1, 2020, it is unlikely that any negative impacts from the COVID-19 pandemic will be reflected in 2020 assessments.  However, Utah law contains a provision for “access interruption” that occurs after January 1 and allows an adjustment to the current year’s assessment even though the events causing a decrease in fair market value occurred after January 1. 

Utah Code Ann. § 59-2-1004.6 states, “if, during a calendar year, property sustains a decrease in fair market value that is caused by access interruption” then the property owner may apply for an adjustment to the property’s fair market value.  “Access interruption” is defined as “interruption of the normal access to or from property due to any circumstance beyond the control of the owner.” Id.  Owners may have properties, the values of which have been negatively impacted by proclamations, orders or actions denying or substantially limiting “normal access” to, or full use of, those properties during the COVID-19 pandemic.  These interruptions should qualify as “access interruption” and entitle the owner to potential property tax relief.  To obtain relief, the property owner must file an application with the County Board of Equalization “on or before September 30” and must prove “that the property sustained a decrease in fair market value during the applicable calendar year, that was caused by access interruption” and the amount of such decrease.  Id. 

Owners of business properties should pay particular attention to their property assessments to ensure that proper treatment is given to the property to account for any negative impacts of the COVID-19 pandemic.  If the assessment does not take into account a reduction in value caused by the COVID-19 pandemic, the owner may wish to seek the relief explained above. 

If you have any questions regarding this potential property tax relief, please do not hesitate to contact us.

David J. Crapo & John T. Deeds
Crapo Deeds, PLLC
American Property Tax Counsel (APTC)

UPDATED september 2019

Virginia Year-End Deadlines Approaching

In Virginia, taxpayers typically have three years from the last day of the tax year for which an assessment is made to appeal the assessment to the appropriate Circuit Court.  In most of the large jurisdictions in Virginia, the tax year corresponds with the calendar year.  As a result, most taxpayers have until December 31, 2019 to appeal their 2016 assessments to Circuit Court.  The majority of Virginia locales do not require an administrative appeal before filing to court (the City of Alexandria being a notable exception); however, if you believe your 2016 assessments overstated the value of your properties or otherwise did not fully account for the impact of market conditions, please contact us to review the case and determine whether an appeal can or should be filed before the end of the year.

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Wilkes Artis, Chtd.
American Property Tax Counsel (APTC)

Updated june 2020

Property Tax Relief Proposed for Commercial Real Estate

While many types of commercial real estate have been hit hard by the COVID-19 pandemic, immediate property tax relief has been in short supply. Immediate tax reductions are available in the event of unexpected physical destruction, such as by fire or flood, but the application of that statute to the pandemic is less clear. Another statute gives relief for government restrictions that cause a loss in value, but the timing of that relief is problematic. The King County Assessor recently proposed legislation to address the problems with current law:

https://www.youtube.com/watch?v=OYkb0f4QLnc. 

The next regular session of the state legislature convenes in January 2021, but the governor may call a special session sooner in order to work on a large budget shortfall. Now is the time to be in touch with your legislator to press the view that property tax relief for commercial real estate should be high on the list of priorities.

Norman J. Bruns & Michelle DeLappe
Foster Garvey PC
American Property Tax Counsel (APTC)

updated june 2020

D.C. Mayor's Budget Anticipates Decrease In Tax Collections Due to COVID Pandemic

Last month, the Mayor of the District of Columbia released a proposed budget for Fiscal Year 2021 that specifically referenced the COVID pandemic’s anticipated effect on property taxes over the next few years. The Mayor’s report acknowledged that “collections are expected to be affected by the COVID pandemic in two ways.” First, the Mayor is anticipating an increase in property tax appeals. Second, according to the Mayor, the next Tax Year – Tax Year 2022, which has a date of value of January 1, 2021 – “will reflect the recession impacts on real property values, particularly commercial.”

The budget anticipates that the “2020 pandemic is expected to have a bigger impact on [commercial] property taxes than” residential property. To that end, the Mayor is expecting commercial property taxes to “decrease by 0.5 percent in FY 2021 and by 2.3 percent in FY 2022, before returning to growth in FY 2023.” Not surprising, a reduction in property tax collections will be “particularly driven by reduced assessments of hotels, retail and restaurants – the industries mostly affected by the pandemic.”

Based on the Mayor’s analysis, the implication is that while retail and hotel assessments will decrease, the assessments of office properties will remain relatively flat, resulting in a lower overall reduction in collections of 2.3%, as opposed to a scenario where there is a greater decrease in collections from commercial property taxes.

Jonathan L. Cloar, Esquire
Wilkes Artis, Chartered
American Property Tax Counsel (APTC)

Updated March 2018

Wisconsin Court Of Appeals Holds That Agricultural Land Classification Does Not Require That Crops Be Grown For A Business Purpose

In a decision issued on March 7, 2018, State of Wisconsin ex rel. The Peter Ogden Family Trust v. Board of Review, the Wisconsin Court of Appeals rejected the assessor’s position that crops must be grown for a business purpose for land to qualify for agricultural classification, which requires assessment at significantly below market value.

Beginning in 2012, the land at issue was classified as agricultural and agricultural forest based upon pine trees, apple trees, and hay the landowners planted on the property. In 2016, the assessor concluded that the property failed to meet the agricultural and agricultural forest classifications and reclassified the property as residential.  This resulted in an increase in the assessed property value from $17,100 as agricultural land to $886,000 as residential land.

The landowners objected to the 2016 assessment, and the board of review upheld the residential classification. The landowners filed an action for certiorari review, arguing that the change was erroneous because it was based upon the mistaken belief that for land to qualify as agricultural land, crops grown on the property must be grown for a business purpose. The circuit court upheld the assessment, and the landowners appealed.

The Court of Appeals examined Wisconsin statutes defining “agricultural land” and “agricultural use,” as well as the relevant Department of Revenue rule, and concluded that the plain language of the statutes and rule refers to “growing” the relevant crops, not marketing, selling, or profiting from them. The Court found that the board of review’s position that the land could not be “devoted primarily to agricultural use” without “minimal sales,” “valid economic activity,” and crops being “marketed for sale” was unsupported and contrary to law. The Court further rejected the board’s argument that the assessor did not impose a “business standard” when evaluating the use of the property, concluding that a review of the transcript of the board hearing demonstrated that the assessor and the board clearly—and erroneously—equated “agricultural use” with growing crops for a business purpose.

The Court thus held that to qualify for agricultural classification, it is sufficient that the land be devoted primarily to growing qualifying crops, whether or not those crops are grown for a business purpose.

Marie Bahoora
Michael Best & Friedrich LLP
American Property Tax Counsel (APTC)