Tuesday, October 09, 2007

On Taxes, Assessments, And "Freezes" That Leave Homeowners Out In The Cold

Semantics May Blur The Numbers, But For Taxpayers, You Just Can't Obscure The Bottom Line

"Freeze" the assessment, and we'll hold the line on taxes. "Freeze" the tax levy, and we'll hold the line on taxes. "Freeze" everything as if it was circa 1908, and we'll hold the line on taxes.

If only we had a single dollar for every time one of our elected officials said "freeze," the property tax crisis would be resolved -- and we'd have something left over for a frozen TV dinner, or two.

The folks who tell you they're "freezing" taxes at last year's levels, blame the increase in your taxes on the assessment.

The folks who now administer the assessment -- brought to you by the courts and tweaked by the quirks of the State Legislature, NOT the Assessor -- will tell you its spending by the local taxing authorities (special districts, school districts, towns, counties), raising the tax rates that increase your taxes, not the fact that assessed values are now based on market values, or that such values are adjusted annually.

And the folks who blame it all on waste, pissing away money like it was water (they take that literally at the water districts), and government excess, well, they'll tell you something you just don't want to hear -- the truth.

Yes, the assessment process is flawed -- big time.

Its not the move away from assessing properties at 1938 values. That was absurd, and entirely inequitable. Full market value is the only realistic indicator of assessed value. Whether property values are "inflated" or not, the indicia of what the market will bear -- or how much is my house really worth -- is the best barometer, readily adjustable for both slumps and boons.

What is inequitable -- and unconscionable -- is (a) relying almost exclusively on the property tax to fund our schools, and (b) the shifting of the tax burden away from commercial properties to the owners of residential properties, establishing different rates for different classes of property owners. [The latter being the product of State mandate, by way of a formula set under the Real Property Tax Law.]

The school property tax burden -- and the many/varied ways of relieving that burden -- has been discussed and debated in these blog posts, almost ad nauseum. [We'll keep doing it, until somebody gets it right!]

But the shift of the tax burden from commercial to residential? What's that all about?

Think about it. A commercial property owner in Nassau County, at one assessment class rate, could own a parcel worth hundreds of thousands of dollars more than the neighboring residential property owner -- who is in an assessment class rate of his own -- and pay significantly less in property taxes.

Where is the fundamental fairness? Where is the justice? Where is the equity?

As far as the residential property owner in Nassau County is concerned, there is none. And for the residential property owner in the unincorporated areas? Even less. [Residential property owners whose properties are in villages, pay significantly less in town taxes (as they use less of the town's services) than residential property owners who reside in the town's unincorporated areas.]

In the Town of Hempstead, the proposed property tax levies for 2008 will, in fact, be held at 2007 levels, the total levy being, give or take, $220.8 million. [This does not, off course, apply to the Town's special taxing districts, the control over which -- despite common knowledge to the contrary -- the Town continues to vigorously deny.]

Commercial property owners, based on their assessment rate class (established by the State Legislature, not the Assessor), will pay less of the $200.8 million dollar pie, as will residential property owners who are within the limits of incorporated villages (many of whom will pay town taxes at or less than 1995 levels).]

So, guess who will have to take a larger piece of that $220.8 million pie, and swallow it whole? You guessed it. Those second-class stepchildren who own residential properties in the unincorporated areas of the township.

Would a freeze in the reassessment help these folks? Absolutely not!

Will the Town of Hempstead's "frozen" tax levy of $220.8 million mean that many of us will not see an increase in the Town portion of our property tax bill? Clearly, no.

So, who's telling the truth?

The Nassau County Assessor, Harvey Levinson, when he points out that a freeze of the reassessment will neither freeze the tax rates nor result in a lower proerty tax bill?

How about the Town of Hempstead Receiver of Taxes, Don Clavin, when he says that tax levies for 2008 will be held at 2007 levels in the township, and any tax increases borne by individual taxpayers are due to the assessment?

Or is it Hempstead Town Supervisor, Kate Murray, when she claims its the assessments inequitable classifications that cause homeowners' tax burdens to rise.

Actually, they are all correct (yes, even Kate Murray), which is what happens when one talks of apples, the other of oranges, and the third of bananas, and all the while, the grapes are left -- primarly by those who hesitate to legislate in Albany -- to wither on the vine.
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Hempstead residents may see property tax hike
By Eden Laikin

Hempstead Town will not collect one cent more in property taxes this year than it did last year, according to its proposed $392.6-million 2008 budget released yesterday. But town officials, placing the blame on Nassau County's reassessment program, said homeowners may see their property taxes go up anyway.

Supervisor Kate Murray, a Republican who is up for re-election in November, added in a prepared statement that as the tax burden of residential homeowners has increased, the share of property taxes shouldered by commercial property owners has decreased.

"Unfortunately, the hard work of responsible government officials has been compromised, indeed undermined, as a result of Nassau County's reassessment ...," the statement read. "Although the town has frozen general town taxes each year since 2005, our (class 1) homeowners will be burdened with over half a million dollars in additional taxes in 2008."

County Assessor Harvey Levinson countered that it's not assessments that drive tax increases, but spending.

"Assessment increases [as reflected in real estate sales] and the residential class share are limited under NYS law," he said. "However, when the town's building commissioner fails to file a building permit and doesn't pay thousands of dollars in property taxes, his neighbors are burdened with more than their fair share."

Levinson was referring to John Loeffel, who resigned in February after Newsday revealed he failed to get the proper permits for renovations at his Levittown home. The preliminary 2008 budget for the county's largest township, with 764,000 residents, will be the subject of a public hearing on Oct 16.

The town's proposed spending plan for 2008 is an increase of $9.1 million over last year, mostly for employee earnings and contractual raises. Other increases include health insurance, which is up $500,000. The budget notes a 3-percent reduction in the workforce, which will save the town $5 million a year. Officials said some of the decline was through attrition, but there also was a "conscious decision to promote from within and to reduce the number of actual employees." There is also a freeze on taxes for village residents, who will pay less in general town taxes next year than they did in 1995, the budget states.

Copyright © 2007, Newsday Inc.
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From Newsday's Letters:

Newsday's spin on budget wrong Only Newsday could have the audacity to term a budget that freezes all Hempstead Town taxes a tax increase ["Homeowners facing tax hike," News, Oct. 2].

Make no mistake, Supervisor Kate Murray's 2008 proposed budget holds the line on all town taxes. The town will not collect one penny more in taxes in 2008 than it will this year.

For years, Newsday has denied that reassessment or assessment updates have had any impact on property taxes. Curiously, an article on Nassau's budget ["Suozzi budget: No tax hike," News, Sept. 17] didn't warrant any such mischaracterization of Nassau's tax freeze document.

Donald X. Clavin Jr.

Editor's note: The writer is Hempstead Town receiver of taxes.

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