Whiteley: Property Review Task Force Needed to Review Property Tax Assessment System and its Cumbersome 3-Step Appeals Process

From Roy Whiteley, Founder, Marylanders for Fair Property Taxation:

Chairman Kasemeyer and Budget and taxation Committee Members,

I am Roy Whiteley, representing Marylanders for Fair Property Taxation, in support of SB 634 Property Review Task Force, a bill that creates a task force to review the property tax assessment system and its cumbersome three-step appeals process, which many dissatisfied property taxpayers do not understand and therefore often avoid even though between about 60,000 and 100,000 appeals per year are continually filed.

As an 86-year-old veteran of WWII and the Korean Conflict, we have been seeking true democracy for over ten years for this bill. Instead, we continually see the lack of a proper review to determine if our bill has merit, will it benefit the taxpayer and the State, is it constitutionally correct, is it legal, can it be made better by amendment? If it passes this muster, then let it go to the floor with a favorable recommendation to be voted on by ALL of those we have elected. It is time to stand up for the taxpayers and put some true transparency into the system. It’s time to grant us that right.

Last year we provided you with a 40-page report about the ills of the archaic, biased, corrupt, flawed, highly subjective, inequitable, non-uniform, and unfair assessments and appeals system. If you took the time to look at just one page showing the wasted millions of assessable base dollars for your jurisdiction, we are sure you would then agree with the following facts, most of which are quotes from SDAT Director Robert Young, showing that his department is failing in its mandated obligations to the taxpayers of this State and needs to be studied to find corrective actions. You can continue to ignore these facts but that will not change them!!!

• The present assessment system is based on construction costs basically in place since its 1977 inception BUT said costs can only be challenged by the taxpayer using fair market sales values.

• Assessment system was updated without public input or methodology change.

• Assessor staff is down from 280 to 158 with no sign of employment offerings to fill vacancies.

• The depleted assessor staff is unable to make physical inspections, or update market value database and indices.

• Assessor staff competency is questionable with no mandatory continuing education required.

• Assessor staff education and skills is less than that of State Licensed Real Estate Appraisers that taxpayers are often forced to hire to challenge inaccurate and unfair assessments.

• Large percentage of assessments are incorrect due to lack of up-to-date record keeping.

• Recent state audit shows 16,948 of 60,199 Montgomery County 2013 assessments with discrepancies ranging from 20 to 43 %. That’s 28% of the 2013 county triennial assessments. Projecting that ratio over the one third of the approximately 666,000 triennial assessments for the year could mean 186,500 are in question.

• An independent Rockville firm analyzed all 2012 assessments for homes in Baltimore City, Anne Arundel, Baltimore, Howard, Montgomery and Prince George’s counties finding tens of thousands of assessments “wildly out of line with their recent sales prices by as much as 20% above or below the sales price.”

• Millions of potential assessable tax base dollars lost and unaccounted for because of these errors.

• Triennial assessments insure that at least 2/3 of 2 million taxpayers’ assessments are at least 2 years out of date.

• Property assessment worksheets are unavailable to taxpayers on line BUT SDAT website promotes private firm, SpecPrint, who purchased said worksheet records and profits by resale negating privacy concerns touted by SDAT Director.

• Assessor hearings are a waste of time, primarily fishing expedition with little accomplished.

• Property Tax Assessment Appeals Board (PTAAB) and assessment offices are housed and staffed together eliminating any separation of function or separation from possible collusion.

• PTAAB is staffed with politically connected citizens with questionable property value knowledge.

• PTAAB staff qualifications and credentials are unknown to taxpayers.

• Tax Courts are inconvenient, time consuming, unfair to taxpayer who must prove State wrong rather than each side proving their respective case.

For eleven years, we have been coming before you to argue these same conditions. We respectfully ask you to explain to us and the property taxpayers of this State what more evidence do you require to warrant enough concern to authorize a study of this obviously broken system?

We have long advocated the need for this task force study and have offered several solutions to the problem including an automated indexed assessment system based solely on fair market sales values coupled with the nationally recognized Standard and Poor Case Shiller Home Price index. Index values already exist on a daily basis and are geographically attuned to the State in four statistical areas with composite values for Baltimore-Towson, MD.; Bethesda-Frederick-Rockville, MD.; Cumberland, Hagerstown, MD. Martinsburg, WV. and Salisbury, MD. Fine tuning, if needed or desired, could be acquired to areas as small as postal zip codes by contracting with Case Shiller. Such a simple automated system based on actual sales made at fair market value or an agreed upon pre-bubble year values kept current via a computerized sales index would eliminate questioning the assessed value, for who can argue against their own sale price paid under fair market conditions? The obvious decrease in appeals at all three appeals levels is an added financial bonus.

Creating this task force to study an archaic system is long overdue. We respectfully ask that instead of exercising your ability to play both judge and jury you instead exercise “true democracy” giving the full General Assembly the opportunity to act on the bill. Give us the chance to put this task force in place with informed citizens who are experiencing the problems first hand and let us show you solutions. All we ask for is that an inexpensive study by volunteers selected by the delegations from the State’s 24 jurisdictions be allowed to look at this property assessment and appeals system to see if there might not be a better way to achieve fair and equal assessment values. There is nothing to fear. It is a win-win situation – with nothing to lose other than a little time to look at an overwhelming system that is abhorred by taxpayers and obviously costing every one – State, County, City and all taxpayers untold millions of dollars..

We urge your favorable report on Senate Bill 634. Thank you.

Roy Whiteley, Founder