Most owners of the 60,200 pieces of real property in the Kenai Peninsula Borough don't find taxes appealing. But those who believed their properties were valued unfairly definitely thought them worth appealing.
On Tuesday and Wednesday, the Board of Equalization, consisting of the nine-member borough assembly, completed formal hearings on 39 of 532 formally written appeals.
According to Shane Horan, the borough's newly appointed head assessor, real property in the borough has a total value of $2,847,696,200. Jeff Sinz, the borough's finance director, estimated taxes on those properties at $29,582,547, or 39.2 percent of borough revenue for Fiscal Year 2001.
"I told (the board) that Cooper Landing considered these high appraisals an attempt to balance the borough's budget in Cooper Landing," said Robert Baldwin, who appeared Wednesday on behalf of his father-in-law Robert T. Williams. "Essentially, if they had appraisals based on inadequate data, that artificially inflated the market. I don't think I used the term then, but I would now: it's a 'self-fulfilling prophecy' in that high appraisals generate high sales as owners attempt to cash out their equity. And higher sales generate higher equity and in turn justify higher appraisals.
"That's something for private real estate to do, but not local government," said Baldwin, president of Quartz Creek Homeowners Association. Baldwin said 89-year-old Williams' tax bill increased 267 percent in one year.
Horan and Bill Popp, borough assembly president, said the increase reflected a systematic attempt to bring valuations current.
"The year before last, the assessor's office took all the appraisers down to the Homer and Anchor Point area," Horan said. "Teams remeasured and reviewed every piece of property.
"Once you get outside the cities, there's no building permits required and it's very difficult for appraisers to cover all the roads all year. It's difficult to know if a property was improved or built on. There was quite an increase just by virtue of the fact that some properties weren't previously on the roll."
After completing that area, assessors moved on.
"The scheduler said, 'Okay, Homer and Anchor Point are done. Now let's go to Cooper Landing and Seward.' It hadn't been done or reviewed in numerous years and obviously it was necessary to kind of look at it and review it," Horan said.
Popp said the delay actually benefited property owners in the area.
"I understand the shock and pain of having your assessment go up so dramatically as opposed to a long, slow climb, but, in effect, if properties were valued properly in previous years, (the owners) would have paid more taxes in the sum of those 10 years than they paid under the recent most assessment," he said.
That was little comfort to Sharon Renfro, who presented her appeal Wednesday by telephone.
"Our taxes skyrocketed this year," said Renfro, owner of four Moose Pass parcels, who said she was told the selling price of a neighboring property had increased the value of her land.
Renfro's appeal focused on a parcel on which she and her husband created a 10-space recreational vehicle park, complete with water and electricity, for $1,500. Assessors labeled the stubbed-in water and electricity "structures," valued them at $10,900 and billed the Renfros $969.22. Land value for that parcel jumped from $66,000 to $101,800.
"The board reviewed it and I guess it was fair because they don't make assessments according to income," Renfro said.
She's not alone in thinking that saving on building or improvement costs will save on taxes.
"Some people argue they may get great deals on materials. After somebody has torn down a house, they may get siding material or roofing material to use," Horan said. "But in reflecting fair market value, we look at comparable sales, not just people's cost."
Cheryl James, a Cooper Landing property and business owner, is considering taking the appeals to the next step.
"I'm contacting everyone that went to the Board of Equalization with regard to a class action lawsuit. I understand the next step is that we can appeal to Superior Court," said James, who saw valuation on one of her parcels jump from $90,000 to $226,600.
Public participation in assessments helps ensure accuracy, according to Horan.
"I have always encouraged people to be vigilant of their own personal affairs," he said. "Come in and review property records and make sure we have the attributes correct."
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