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EQUALIZATION PROJECT TEAM

MINUTES
Wednesday, October 1, 2003

10:00 a.m. – 3:00 p.m.;
Video-Conference Between ORPS Syracuse & Newburgh Offices

 Attending:

 Assessors:  Dave Briggs, Edye McCarthy, Roger Tibbetts, Walter Smead

 County Directors:  Tom Bloodgood, Paul Burckard, Barry Miller

ORPS:  Pat Holland, Jim O'Keeffe, Tim Maher

Other:  Tom Frey, Bruce Sauter, Curt Schoeberl, Dave Williams

Update from RPTAC Valuation Team:

Bruce reported that it is difficult to develop computer models to estimate the market value of commercial properties.  He said two major problems are the lack of income data and the inconsistency of data.  It appears that the best chance to use modeling will be with certain types of commercial properties such as apartment buildings or warehouses. 

ORPS has a team that is working with a consultant (Bob Gloudemans) to research the potential use of CAMA modeling, and other aggregate valuation techniques for non-residential property types.  The team will address potential techniques by property type, and identify the data requirements and criteria for using these techniques.  The team has been asked to develop recommendations by April 2004.          

Rules & Legislation Update:

Jim reported that the Assessment Calendar Team recommended to RPTAC that the valuation date be moved from January 1 of the current year to July 1 of the prior year.  The team also recommended changes to the dates that assessors are required to submit the assessment roll to the county, school districts and ORPS.  Under current law there is a different filing date for each, and the team recommended that the assessor file the roll with all three parties within 15 days of final roll date.

2003 Rates Status and Issues:

Pat reported that tentative 2003 State equalization rates have been established for 950 cities and towns.  The equalization rate is the same as the LOA declared by the assessor for 78 percent of these municipalities.  She said that ORPS is on schedule to establish final rates for all municipalities before the first levy of taxes. 

Dave Williams stated that the pre-decisional (PDC) meetings for 2003 equalization rates were another step in the right direction but they were held too late in the process.  The plan for 2004 equalization rates is to start holding PDC meetings with the assessors in November 2003. 

Plan for 2004 Rates & Beyond:

Dave Williams said that he is working with ORPS staff to make certain that our full value estimates for every municipality makes sense.  Dave has instructed staff to be flexible and to accept any data from local officials that support a reasonable estimate of market value.  He said the plan is to analyze all available valuation data and develop a reasonable estimate of value.

At our meeting on July 23, 2003 the team agreed on the following issues for 2004 equalization rates:

-         A current year full value standard

-         Establishment of tentative rates within 30 days of tentative roll date (in May for most towns)

-         Establishment of final equalization rates at least 30 days prior to the apportionment of taxes (by August 1 for most towns)

-         Conduct new sales ratios studies for the residential class every year

-         Conduct new CAMA studies for the residential class every year

-         Continue to confirm the LOA as the equalization rate if the difference between the LOA on the tentative roll and the initial ORPS market value ratio is less than 5 percent

-         Limit trending to three years for all municipalities

-         Conduct appraisals at least once every three years in municipalities that are not conducting reassessments

-         Do not conduct appraisals in major types that are a small percentage of a municipality

-         Continue to allow municipalities to complain about any data used to establish the tentative equalization rate

-         Pre-decisional collaboration meetings should be held in the fall of 2003.  Priority should be given to municipalities that are conducting 2004 reassessments.

At the meeting in July the team had concerns about the following twelve issues.  We discussed the issues at this meeting and made decisions on how to address them in the 2004 equalization rate procedures.

Issue 1)

If ORPS rejects the LOA should the residential sales ratio or the residential CAMA study be used to calculate equalization rate? 

The team agreed that if ORPS rejects the LOA and ORPS has conducted both a residential sales ratio study and a residential CAMA study then the equalization rate will be calculated using the ratio study that results in the rate that is closest to the LOA stated by the locality.  In 2003 when the LOA was rejected the ratio from the sales ratio study was used to calculate the equalization rate.

 Issue 2)

Should we increase sample sizes? 

It was agreed that an increase in sample size would increase the confidence in our results, however there is a limit to how many additional appraisals ORPS can conduct.  ORPS will identify the municipalities where they have the least confidence in their results and develop a process for conducting additional appraisals in these municipalities. 

Issue 3)

Is stratification needed in sales ratio studies? 

In some municipalities stratification would improve the results.  The 2004 procedures will be written to specifically allow the use of stratification where it is appropriate.  

Issue 4)

Should we stratify by property use instead of assessed value within major type? 

In some municipalities a different stratification method would increase the confidence we have in the results.  However, at this time it is too late to modify our computer systems to allow alternative stratification methods for 2004 equalization rates.  ORPS staff will review any data that local officials develop to estimate the market value of their municipality.  It is important that local officials share any alternative information with ORPS staff as soon as possible.  This will allow ORPS staff to thoroughly review the data.  

Issue 5)

Should different staff review complaints (possibly in a different regional office)? 

This recommendation will be forwarded to ORPS regional management for their consideration.  

Issue 6)

Will ORPS make any changes in the valuation of commercial property? 

ORPS is not planning to make any methodology changes for 2004 equalization rates.  ORPS staff will review any data that local officials submit that supports an alternate estimate of value.  ORPS has a team that is exploring alternative methods for valuing commercial property in future years. 

Issue 7)

Will ORPS time adjust sales?

Yes, if the data shows that there is a market trend then it is appropriate to time adjust the sales.  

Issue 8)

Will ORPS continue to use “retro” sample parcels? 

M“etro” appraisals are only used in municipalities that have not conducted a recent reassessment and the assessed value of the sample has not changed since the last time it was used.  It is less expensive for ORPS to appraise the same property again then to appraise a different property.  For 2004 equalization rates ORPS will use some “retro” appraisals. 

Issue 9)

Will ORPS continue to use trending? 

Yes, the plan is to limit trending for equalization rates to a maximum of three years.  

Issue 10)

There are different skill levels among CRMs. 

We agreed that this is true and that as CRMs become more experienced and share information with each other the skill levels of all CRMs will increase. 

Issue 11)

Is it a problem that the ORPS staff that assist the locality to conduct a reassessment also review the reassessment for equalization rate purposes? 

At this time the team did not think this is a problem but will continue to monitor this issue in future rate years.  

Issue 12)

Should ORPS provide assessors with the proposed responses to equalization rate complaints prior to the State Board meeting (the current process is that staff's responses are not sent to the assessor until after they have been approved by the State Board)? 

The team agreed to discuss this issue at our next meeting.

ORPS staff will develop draft 2004 equalization rate procedures and the team will discuss them at the next meeting.  The plan is to ask the State Board to adopt 2004 equalization rate procedures at their meeting on January 27, 2004. 

Next meeting – Tuesday, December 2, 2003 in the Syracuse office of ORPS from 10-3.  We will video-conference to the ORPS Newburgh office. Proposed agenda topics include:

-         Status of 2003 rates

-         Review Draft of 2004 Rate Procedures

-         Status of Pre-Decisional Meetings for 2004 equalization rates

-         Discuss sharing of data between ORPS and Assessors (including the time between filing of rate complaint and State Board meeting)

-         Discuss equalization rates for exemptions that are not the same as equalization rates for apportionment

-         Discuss sales with significant inventory changes

Updated: