The borough reassessed the values of all properties on the road system this year in an effort to correct tax inequities among property owners. But this unprecedented mass review has meant a major increase in the number of appeals compared to previous years.
In the coming weeks, the borough’s contract assessors and the Board of Equalization will get to work addressing those appeals.
Of around 2,300 properties that were reassessed this year, owners appealed 179 valuations. Last year, there were only 52 appeals, though only a third of properties in the borough were reassessed.
“This is the first mass appraisal that has probably been done since inception,” said Finance Director Mason Villarma. Some property assessments had hardly changed in value in 30 years, leading to sticker shock for some residents.
Most properties increased in value between $100 and $18,100. Twenty-three properties increased by $234,100 or more and one increased over $500,000.
The comprehensive review resulted in the total taxable value of properties in the borough 56% higher than last year.
The borough assembly, however, has not yet set the mill rate (tax levy), which is multiplied against the assessed value, so the effect the higher values will have on property taxes is still uncertain.
The deadline to file an assessment appeal was April 20. The Board of Equalization — which consists of the mayor and assembly acting as a judicial body — will start hearing appeals on Monday. It will meet every weekday evening until all the outstanding appeals have been resolved.
Before these hearings begin, property owners who appealed will have the opportunity to meet with an assessor to go over their case. Martins Onskulis and his colleagues in the Appraisal Company of Alaska arrived in Wrangell last weekend and will be working out of City Hall for the next week and a half. The goal is to resolve as many issues as possible before the Board of Equalization starts its evaluation process.
Communities substantially reduce the number of appeals that go to formal hearings this way. In the past, for example, the Petersburg borough has been able to cut down its hearings by almost 80%, from 65 to 14.
“Each property owner gets a phone call,” explained Onskulis. They can talk with assessors via phone, at the property or at City Hall. Sometimes properties need to be repaired or have issues that aren’t visible from the street, and these meetings give owners the chance to make their case. In situations where the owner hasn’t supplied sufficient information or can’t prove that their assessment was inequitable, the property value will likely not change.
About half of the people who submitted appeals this year asked for guidance from borough staff, who helped them compare their property’s value to the values of neighboring properties. “We helped out a lot of folks,” said Villarma, “I’m proud of that.”
As a rule, people usually do not win appeals. Proving that an assessment was excessive, unequal or improper is difficult to do, even with the help of the borough’s Finance Department. However, a few of the appeals that crossed Villarma’s desk seemed like they had a strong case before the Board of Equalization.
“There were a couple that seemed grossly exaggerated, so we certainly wanted to help those folks out,” he said. “You have … two or three assessors assessing 2,300 parcels. Is there a chance for error or adding a zero? Certainly. But for the most part, I’d say things are on par.”
“The fact of the matter is, we want this to be a successful process for people,” he continued. “Because if there are inequities that exist, or if things were done improperly, then we want to fix that and get it right.”
Other Alaska communities are also seeing high appeal volumes as property values have increased in the past few years. In Valdez, which has a population about twice the size of Wrangell’s, 270 assessments were appealed; in Cordova, which has a population similar to Wrangell’s, 97 were appealed.
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