WPCNR QUILL & EYESHADE. By John F. Bailey. March 3, 2008: The 2008-2009 Assessment Roll was officially released this morning, showing City Assessed Valuation has risen slightly over last year’s $6 Million decline.  The City Tax Assessor reported thought that Residential Assessed Value had declined 3.9% for the first time in a decade.

 The Roll from which city, school and county taxes are determined rose to $290,189,377  up from $289,902,411 Million last year ending a five year decline in the city’s Assessed Value.

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The Good Book! City Assessor Lloyd Tasch presented the 2008 Assessment Roll this morning.

 The city Homeowner’s total Assessed Valuation declined 3.9%, according to Lloyd Tasch, the City Assessor. The  Assessor attributed the stabilization of the assessment roll to the addition of the Louis Cappelli Ritz-Carlton Hotel structure (excluding the two residential towers) and the Ritz-Carlton underground garage (beneath Renaissance Square) to the tax roll at full valuation for 2008-2009, and the return of Nine West to the tax roll.

The school district Assessment Roll for 2008-2009 stands at $291,802,226, which reduces to $249,529, 555  after the STAR exemption.

The Assessor said the stabilization “reflects a balance between certiorari settlements and current City of White Plains development that has taken place. Without the development the Mayor has been responsible for, the City  would be troubled.”

The assessor remarked that the Equalization rate decline ( from 3.24 in 2007 to 2.75% in 2008) “never helps White Plains therefore the city is dependent on development in order for it to be able to endure its certiorari losses.”

“This year we took a terrific hit at the residential assessed value,” Tasch elaborated, “because of the stabilization or slight decline in the residential market.”

Residential Value Declines 3.9%

Tasch said this was the first time the Residential Assessment Ratio in White Plains had declined in ten years he has been with the White Plains Assessor’s Office. (He has been Acting, then City Assessor for two years.)  He said there had been a 3.9% decline in the value of residential property.

However, the Assessor said there was approximately  twice  the number of residential homeowners filing for certioraris in January up from 106 to 173.  Tasch said those claims had already been settled and were reflected in the new roll.  He noted that adjustments to homeowner assessments had very small effect on the final roll and were not a factor. He said he worried more about the large commercial properties where you can lose a million dollars in assessed value with one settlement.

9-West, Louis Cappelli Hotel & Parking Facility Lifts Roll.

Asked how the city was able to make up the certiorari losses of the last year, Tasch said the Ritz-Carlton hotel structure and its subterranean garage have now been fully assessed and placed on the tax rolls. The condominium tower on Main Street and the office/condominium tower on Hamilton, part of the complex have  not been tax rolled yet.

He also noted that 9 West had come off its PILOT of $355,022 paid to the city and $1,420,000 to the school district. Tasch said he had assessed it at $3.2 Million as a PILOT, and the Board of Assessment Review had set its present assessed value  (after PILOT had ended) at $1,950,000, which added that amount to the city assessment roll.

Tasch said “In the public’s eye, people have a problem with PILOTS. PILOTS have been important to White Plains taxpayers for many years, contrary to the negative portrayal of their agreements.”

Possible new taxes after PILOTS less than the PILOT

WPCNR observes that this new assessment results in a city tax of $276,705  in 08-09 based on last year’s tax rate, and a school tax of $924,300 for a total tax payment between city and school of about $1,201,000 in the coming year. This is approximately $500,000 below  what they were paying in their last PILOT payment, $1,775,000.  At least in this case, the PILOT payment Nine West had been paying was higher than their present estimated tax payment for 2008-2009, though the PILOT was set a number of years ago. The Board of Assessment review apparently feels that time has not been kind to the 9 West appreciation in value over the years.

Expects Equalization Rate,  Assessment roll, to Stabilize.

Tasch said “I estimate the assessment roll to continue to be flat or slightly up for next year and the State Equalization Rate to be flat.”

Asked if the low Equalization Rate of 2.75% was going to result in more certiorari filings in the months ahead by commercial properties, Tasch said he had not seen it, the number of businesses filing had not increased, though as noted previously, residential certioraris had increased, though he allowed that was a possibility. WPCNR notes that the last two times such drops in the Equalization Rate occurred  of this year’s magnitude it resulted in the rounds of certioraris that have resulted in certiorari’s costing the city $30 Million in assessments.  A 1.64 percentage point drop (from 6.35%) in 2002-03 and a .64 drop in 2004-2005 (from 4.45%)  helped induce commercial property owners to challenge their assessments. This year’s reduction was a half percentage (3.24% down to 2.74%), and perhaps may have a comparable impact.

No Surcharge or Penalty Device Being Considered

WPCNR asked if the city was considering a surcharge or mechanism to apply to commercial properties to discourage certiorari filings and recoup lost revenue for successful certiorari suits. Tasch said the city definitely was not contemplating such a mechanism.  He said that because the city is not a reassessment community,  the Assessment office has no right to reexamine a property unless some kind of construction occurs, or the property asks for a Board of Assessment Review.

Long Day's Journey Into Assessment Night

For the record, the City Tax Assessment Roll 17 years ago (1991) stood at $424.1 Million of Assessed Value. By 1997, the first year of the Delfino Administration, it had fallen to $337.3 Million.

This $86 Million drop (B.D., "Before Delfino)  in Assessed Value was based largely on the plunge of the equalization rates of  .45% in 1995-96,  .25% in 1996-97, and a stiff .81 % in 1997-1998 – due mainly to ballooning real estate values – triggering certioraris.

From 1997-98, (A.D. "After Delfino"),  the Assessment Roll continued to erode, from $337.3 Million in 97-98 to $318.8 Million in 2002-2003. The Equalization rate fell by almost half from 8.22% in 1997-1998 to 4.71% in 2002-03, triggering massive certiorari efforts on the part of commercial properties as the housing price escalation hammered the assessment roll.  The Equalization Rate experienced a .12% decline in 98-99, a .65% decline in 99-00; a .36% decline in 00-01; a .74% plunge in 01-02 as rising home prices made it clear on paper that commercial properties were over-assessed.

The Time Bomb

In the last five years of the Administration those certioraris won inadvertently by the Equalization Rate, have been coming home to roost, driving down the City Assessment Roll from $318.1 M in 01-02 to $290.2 Million today, a $28 Million loss of Assessed Value in five years. And there are more of these settlements to come.

In the last five years the Equalization Rate has continued to take its macabre financial toll on the White Plains residential taxpayer.

In 02-03, it dropped, as previously noted, 1.64%! Those were boom days in real estate. In 03-04, .26% eroded off the E.R. In 04-05, .63% was shaved off. The last three years the declines continued, .28% to 3.54%; .30% to 3.24% last year down to the present Equalization Rate of 2.75%, another .49% decline.

Seeing this trend, which has not been matched by any fiscal restraint or significant budget adjustment by either the city or the school district,  or mitigation effort,  the White Plains Homeowner may never see the results of selling their home at the price it has inflated to over the last 17 years.