City of Buffalo

Assessment EquityProject - 2020

Public Information Session

July 2019

Jason C. Shell, MPACommissioner of Assessment & Taxation

John ZukowskiJoseph H. Emminger

Emminger, Newton, Pigeon & Magyar, Inc., City Reassessment Contractor

Goal of the Project

The goal of the assessment equity

project, is to establish uniform, fair

and equitable assessments on all real

property types!

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ReassessmentDoes Not

Raise Tax Levies

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*** Reassessment provides an equitable redistribution of the property tax. ***

Now we will show you how.

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The Property Tax

• It is an Ad Valorem (At Value) Tax

• The Tax is based on the value of real property

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Budget vs. Levy

• The taxing jurisdiction – city, county, etc. are responsible for developing and adopting a budget.

• Revenue from all sources other than the property tax is determined.

• These revenues are subtracted from the budget to arrive at the tax levy.

• Total Cost –Other Sources of Aid=TAX LEVY-THE AMOUNT TO BE RAISED BY TAXATION

NYS Property Tax Cap

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• On June 24, 2011 the property tax cap was signed into law (see Chapter 97 of the NYS Laws of 2011).

• What is the property tax cap? The tax cap law establishes a limit on the annual growth of property taxes levied by local governments and school districts to 2% or the rate of inflation, whichever is less.

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Tax Cap

2018/2019 2019/2020 2020/2021

City Tax Levy City Tax Levy City Tax Levy

$145,000,000 $147,537,500 $150,488,250*

*This dollar amounts reflects a 2% increase in the tax levy which is the highest amount that the levy could go up. The actual figure will not be available until sometime next year. The figure shown is for informational purposes only.

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Assessment Equity

• Equity with respect to assessments and real property taxes means:

– Properties are assessed at a uniform percentage of value

– Properties with similar values pay similar taxes

– Taxpayers pay their FAIR share

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Equity versus Inequity

• If one property or neighborhood is significantly under-assessed, not only are they paying too little in taxes, but other property owners are subsidizing that taxpayer’’’’s or neighborhood’’’’s share of the tax bill.

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Effect of Inequitable Assessments

Mrs. Smith

Full Market Value = $100,000

Assessed Value = $100,000

Mrs. Jones

Full Market Value = $100,000

Assessed Value = $100,000

2013 2013

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Effect of Inequitable Assessments

Mrs. Smith

Full Market Value = $300,000

Assessed Value = $100,000

Mrs. Jones

Full Market Value = $150,000

Assessed Value = $100,000

2020 2020

Mrs. Jones is subsidizing Mrs. Smith’’’’s taxes!

Assessments vs. TaxesWhat’s the difference?

YOUR ASSESSMENT COULD INCREASE AND YOUR TAX BILL COULD DECREASE

2019

Assessment: $100,000

Total Value of City: $6,600,000,000

Tax Levy: $140,000,000

Tax Rate: $21.21 per $1,000

Your Property Tax Bill: $2,121

2020

Assessment: (25% Increase) $125,000

Total Value of City:(27.5%Incr.) $8,415,000,000

Tax Levy: $140,000,000

Tax Rate: $16.64 per $1,000

Your Property Tax Bill: $2,080

(DECREASE of $41)

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Assessments vs. TaxesWhat’s the difference?

YOUR ASSESSMENT COULD INCREASE AND YOUR TAX BILL COULD STAY THE SAME

2019

Assessment: $100,000

Total Value of City: $6,600,000,000

Tax Levy: $140,000,000

Tax Rate: $21.21 per $1,000

Your Property Tax Bill: $2,121

2020

Assessment: (25% Increase) $125,000

Tot Value of City:(27.5%Incr.) $8,415,000,000

Tax Levy:(2.00% Increase) $142,800,000

Tax Rate: $16.97 per $1,000

Your Property Tax Bill: $2,121

(NO CHANGE)

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Remember!!

• Property Taxes – based on assessed value

• Market Value is defined as – what a willing buyer will pay a willing seller in a fair and open real estate market.

• You want to only pay your fair share of the tax pie

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How Is Market Value Determined?

• The Assessor does NOT create market value

• Market value is determined by the interaction of buyers and sellers.

• The assessor monitors and analyzes real estate transactions to establish market value estimates for real property within the city.

• The Assessor uses comparable sales in your neighborhood that are most similar to your property and adjust for items of variance to establish market value

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What Drives Market Value?

• Location, Location, Location

• Some locations are more desirable than others.

• Market participants determine the neighborhoods which are in demand by paying higher prices for homes in those locations.

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What Else Drives Market Value?

• Economic influences – Such as demand for the homes in the neighborhoods location and the supply of homes available for sale

• Interest rates and resulting buying power of consumers

• Availability of amenities and jobs

• Consumer desires and the quality, condition and amenities of a property

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The question to ask yourself . . .

• Is the market value estimate theassessor has derived for your propertya reasonable representation of whatyou would expect to receive for yourproperty if it was offered for sale onthe open market?

Buffalo Reassessment Project Website http://www.buffalo.oarsystem.com/

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Property Information and Comparable Sales Search

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Sample Disclosure Notice

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CITY OF XXXX REASSESSMENT PROJECT 2016 ASSESSMENT DISCLOSURE OVERVIEW

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Informal Review Process

• Locations/scheduling of meetings will follow on city website and in your disclosure letter in August

• One-on-one meeting with the contractor

• Very informal

• Property owner should provide proof of lower value (appraisal, photos, survey)

• Property owner will be notified by mail of decision

Board of Assessment Review (BAR)

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� Board comprised of experienced peers

� More formal hearing than the Informal Review Process

� Must fill out NYS Form RP-524

� Petitioner is sworn in prior to giving testimony

� Burden of proof is on the Petitioner

� Decision by BAR is binding

� If Petitioner is not satisfied with BAR decision they can go to SCAR

Small Claims Assessment Review (SCAR)

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� Only applies to owner occupied residential 1-3 family dwellings

� Hearing Officer (typically an attorney is appointed by the court)

� Filing fee of $35.00 (set by NYS)

� $35.00 fee is refundable if claim is successful

� Appraisal, while not required, is typically encouraged

� Hearing Officer’s decision is final

Tax Certiorari – Article 7

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� Applies to commercial properties and vacant land

� Must be filed through the NYS Court system by an attorney

� Appraisal is required

� Time to take the property to trial and receive a decision could take up to 5 years

2020 City of Buffalo Reassessment Schedule

• Impact Notices Mailed to taxpayer – End of August 2019

• Informal Review Sessions– Start September 2019

• Notification of Informal Review Results-End of November 2019

• Tentative Assessment Roll – December 1, 2019

• Grievance Filing Period – Dec. 1 to 31, 2019

• BAR Hearings – Start January 1, 2020

• Final Assessment Roll – March 1, 2020

• First Tax Bills Impacted – July 1, 2020 (City & Sewer); January 1, 2021 (Erie County)

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THANK YOU!!!

John ZukowskiJoe Emminger

Emminger, Newton, Pigeon & Magyar, Inc.,

For More Information call:

716-712-5550

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