[StBernard] State Tax Commission study says St. Tammany Parish property values were set too low

Westley Annis westley at da-parish.com
Thu Apr 16 09:15:41 EDT 2009


State Tax Commission study says St. Tammany Parish property values were set
too low
Posted by Charlie Chapple April 16, 2009 7:48AM
When St. Tammany Parish Assessor Patricia Schwarz Core posted the 2008
property tax roll last fall, thousands of residents and dozens of local
officials vehemently complained that property values were set too high.


But a recent study conducted by the state Tax Commission has concluded just
the opposite. It found that Core reassessed properties at an average of 83
percent of fair market value, a level unacceptable under state law.

Core has been called to a commission meeting in Baton Rouge on Tuesday
morning to decide what corrective measures need to be taken.

Core said Wednesday that she plans to defend the rolls and fight any attempt
to raise assessments, which would result in higher tax bills for property
owners. Chief Deputy Assessor George Klumpp Jr. said the office has until
next year to correct deficiencies, so no immediate action is necessary or
anticipated.

"Ultimately, it's up to the commission to determine what I have to do, "
Core said.

The commission conducted "sales ratio studies" in all 64 parishes at the end
of the year to determine whether homes and businesses in each parish are
being assessed at a state-law-required benchmark of 90 percent to 110
percent of fair market value.

St. Tammany was one of nine parishes where assessments fell below the
benchmark, commission administrator Charles Abels III said. He said the
other parishes are St. Bernard, Plaquemines, St. John the Baptist,
Ascension, Lafourche, Terrebonne, St. Helena and Madison. Studies in those
parishes showed assessments being done at 70 percent to 88 percent of fair
market value, he said, and officials in those parishes also have been
notified of Tuesday's commission meeting.

In St. Tammany, Abels said, the commission reviewed the sales of 500 lots,
homes and businesses, and compared the selling prices with their 2008
assessments on the tax roll.

The comparisons showed that on the average, assessments were 7 percentage
points lower than the required benchmark, he said. The sales used for the
study occurred from the last half of 2006 through the first half of 2007,
the time period set by state law for determining the fair market values for
the 2008 assessments.

Core said an antiquated state law caused her office to fail the ratio study.
Property values were skyrocketing during the post-Katrina boom during 2006
and the first half of 2007. Property values have declined dramatically
since, she said, and a house that sold for $500,000 in 2006 had a
significantly lower value in 2008, or even late 2007.

If the ratio study had been done using more recent sales, "even the last
half of 2007, you would have seen the beginnings of a depressed market, "
Core said. But assessors were required to set the tax rolls using property
values from July 2006 to June 2007, Core said.

"With the technology we have now, there's no reason we couldn't use Jan. 1,
2007, to Dec. 31, 2007, as the time period, " Core said, confiding that's
what her office actually did. That and the fact that her office tries to set
assessments that reflect 90 percent of fair market value -- leaving little
room for error -- led to the conclusions in the ratio study. Had the study
been done using more recent sales figures, "there's no doubt we would have
passed ratio study, " she said.

Abels said 59 parishes met the benchmark. He also noted that when property
values are increasing, no one complains about the time period to determine
assessments being set too early.

The decline in property values has continued with the nation's economic
woes, tight credit and glutted local housing inventory, Core said.
Assessments in parts of the parish actually should be reduced in 2009 to
reflect the decline, she said.

Core said the commission's study does vindicate her position that the vast
majority of properties were not over-valued on the tax roll as thousands of
residents contended. An unprecedented 15,000 property owners appealed their
assessments after they were posted by Core's office.

In late October, the commission conducted a random survey of 292 homes in 31
subdivisions throughout St. Tammany prompted by the complaints and requests
from local officials, including state legislators.

That survey reached the same conclusion as the more extensive ratio study
that would be done later: Homes were being reassessed at an average of 83
percent of fair market value.




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