Q: UNDER MAYOR NUTTER's Actual Value Initiative, why has the city determined that some properties are worth less (or more) than what they sold for in the last couple of years?
A: Just a couple of months ago, a building at 7th and Bainbridge streets sold for $950,000. The city assessed it for tax purposes at $545,600. Several blocks away, a home on Morris Street sold for $100,000 last September. But guess what the city assessed it at? $202,700.
Why is this happening?
Well, there are a few potential reasons. One possibility is that a property's sales price simply doesn't reflect its actual value.
The goal of Nutter's property- tax overhaul is to assess homes and businesses based on their market value. But Richie McKeithen, the city's chief assessment officer, said that a property's assessment ought to be different from its sales price sometimes.
For instance, he said that it should vary when people have paid less - or more - for a house than it's worth. A home's value also could have changed since it was sold.
A second possibility is that an assessment is just wrong. If a homeowner thinks that his new assessment is off, he can ask the Office of Property Assessment for an informal review.
A third possibility is that the whole reassessment is flawed.
Councilman Mark Squilla said that his office has found hundreds of questionable assessments, including many that are very different from recent sales. He thinks that this may indicate a bigger problem.
He said he's worried "that there's maybe some type of flaw in the process of how this was all done."
At this point, no one has demonstrated through a comprehensive analysis that the new assessments are inaccurate.
- Holly Otterbein, It's Our Money
