Total assessed property values up 56% from last year as borough corrects inequities

A comprehensive review of assessments on every piece of property in the borough has resulted in total taxable values 56% higher than last year.

That doesn’t necessarily mean this year’s tax bills will increase. The actual tax rate multiplied against the assessed value will depend on what the assembly decides is needed for the borough budget this spring.

Assemblymember David Powell said Friday the assembly would do its best to maintain consistent tax bills for residents, covering the borough’s budgetary needs and no more. “We know that all the assessments went up,” he said. “Some people are going to pay a little bit more, but we are going to lower the mill rate to fund what we have funded in the past.”

He plans to “fight tooth and nail” to prevent unnecessary tax increases. “If your taxes were $100 last year, we’re going to make it so we’re close to that $100 still, even if your property (assessment) went up.”

The largest segment of properties — 597, about one-third of all the parcels in town — increased in value between $100 and $18,100 each. Twenty-three properties increased by $234,100 or more and one increased over $500,000. A few lost value due to water damage or shifts in their foundations.

Some states set limits on how much a property’s assessed value can change in a single year — Alaska does not.

The borough embarked on the reassessment effort last year to correct inequities in taxable values. Some properties had not been reassessed in 10 or 20 years, and similar homes in the same neighborhood sometimes were assessed at significantly different values.

In a report presented to the borough assembly Feb. 28, the total taxable value of all property came in at $235.1 million, a 56% gain from last year’s $150.3 million.

Of the $235.1 million, $76.8 million was land and $158.3 million was the assessment for what was built on the land.

The report by the contract assessor put the value of non-taxable property at $150.8 million. That includes state, federal, borough, SEARHC and church property, and almost $37 million in residential property owned by senior citizens and exempt from taxation under state law.

Individual assessment notices will be sent to residents on March 20. The tax rate will be set by June 15 as part of the assembly’s annual budget deliberations. Property owners should know their tax bills by July 1.

The fieldwork portions of the boroughwide reassessment were conducted last November. Appraisers made in-person visits to homes on the road system that had undergone new construction since they were last assessed or that had issues with their square-footage numbers and measured their exteriors.

Many Wrangell homes did not require in-person visits, since their sizes and conditions had not changed dramatically in the years since they were last assessed, explained Martins Onskulis of the Anchorage-based Appraisal Company of Alaska, which was hired on a $48,000 borough contract. Instead, the values of these homes were adjusted to reflect the current conditions of the real estate market.

“What the market is doing right now is basically take it or leave it,” Onskulis told the borough assembly at a work session Feb. 28. The market favors sellers — unless an asking price is truly outlandish, property owners are likely to find a willing buyer for their home. The lack of vacant land in Wrangell, combined with high construction costs due to lingering pandemic supply chain disruptions, have also pushed prices up.

“It’s not us assessors creating the property value increase,” he explained in an email. “It’s property owners creating value changes through their transactions in the market. We are just doing the research and reporting back to the city about what the market is doing. We always take a cautious approach in calculating values (and) trends and even with the larger increase this year … most of the properties are still valued less than what they would sell for.”

Onskulis expects that many Wrangell residents will want to appeal their assessments. “In some communities, the property market has been high for many years,” he said. “So residents are more aware of the costs, but in a town like Wrangell, you could still buy land or a house for a reasonable price not too long ago.”

Finance Director Mason Villarma encouraged residents to appeal their assessment if they have concerns about its fairness. The assessment is “about parity,” he explained. “If you notice that your assessment compared to your neighbor doesn’t seem to demonstrate that parity, come in … the goal is to get them right.”

In past years, the borough strove to update the assessments of one-third of Wrangell properties every three years, but this year all of the property values will be adjusted. “We noticed that there were some inequities across the board,” Villarma said. “If you were to do a third this year, a third of the borough would be paying a lot more.”

Property owners who want to appeal should contact the Appraisal Company of Alaska (907-562-2424 or office@appraisalalaska.com) which performed Wrangell’s assessments, and review their file with an appraiser to determine whether the company has accurate information on their home’s condition and square footage. Assessors can explain a property’s assessed value, answer questions about the assessment and review any additional material homeowners may provide, according to borough documents.

Property owners can also visit City Hall to review their property card and compare it to cards for properties in the surrounding area.

Owners can file a formal appeal with the borough’s Board of Equalization, challenging the appraisal. Such appeals must be filed within 30 days of the mailing of the assessment notice later this month. The Board of Equalization consists of borough assembly members acting as a review panel.

Appeals forms must demonstrate that the assessment is excessive, unequal, improper or undervalued. Appeals that use detailed, concrete evidence like photos of damage, sales information or an appraisal or engineering report are more likely to succeed. Merely stating that the increase is unfair is not a successful appeal strategy, according to borough documents. To request an appeal form, visit City Hall or contact the borough clerk.