My Turn: Memo to city council: Reject property appraisal
On Monday the Concord City Council will hold its second hearing and vote on whether to authorize the annual appraisal of city real estate. This year’s appraisal has resulted in significant tax increases for many commercial properties, particularly in downtown Concord and Penacook.
While the new appraisal starts to shift the tax burden from residential to commercial, the methodology and results of this year’s appraisal are in question. Many downtown building owners will see tax increases in the multiple of thousands of dollars – and there is a question about the timing of such a large increase.
One explanation given by the city assessor for the dramatic change in assessments is that the commercial sector hasn’t been reevaluated since 2008. Yet 2007-08 resulted in some of the highest real estate values our city has ever seen.
And we have been told the reason the city has been doing yearly assessments was to avoid the large spikes in assessments we are seeing this year.
The experience of residential homeowners has been different. For me, 2008 was the first year I saw a decrease in my house’s value after an almost 10 percent increase in value in 2007. Each subsequent year since 2008, the value of my house has decreased, according to the city. And even though my house value went down in 2008, it was still the second highest valuation of my house in the 23 years I have owned it.
Yet we are supposed to believe that commercial properties and businesses have fared so much better than the residential market that many of their building’s values have increased by 30 percent or more since 2008. Please.
Big changes coming
The large spike not only in the value of commercial properties but also in the taxes they owe the city comes as both downtown Concord and Penacook are embarking on multi-year construction projects that will most certainly affect their bottom line. I find it difficult to believe that commercial property values have increased to the extent the assessor’s office claims, just as we are starting to extricate ourselves from the worst downturn in our economy since the Great Depression.
If the city council votes not to accept the annual appraisal, building values stay the same as last year. Buildings that have had a change of use and buildings whose physical characteristics have changed can still see changes to their assessments.
And while tax liabilities can still increase or decrease (even when assessments remain constant) based on the city’s spending, having confidence that the value of their buildings will remain fairly consistent over the next few years will allow for commercial property owners to better plan and be able to meet their expenses.
I see only one option for the city council at its Monday meeting: Just vote no – no to authorizing this annual appraisal.
State law requires a reevaluation only once every five years. While there may be a good reason not to wait until 2017 to revaluate properties in Concord, we should at least wait until after the downtown construction projects are complete before we start fiddling with assessments.
(Allan Herschlag lives in Concord.)