PRINCETON: Revaluation rage prompts officials’ letter

By Kristine Snodgrass, Staff Writer
   The Princeton Borough Council and Township Committee sent a letter Thursday to Appraisal Systems Inc. formally requesting that the firm provide a detailed explanation of the methodology it used to complete the recent revaluation of both communities.
   The letter (SEE FULL TEXT BELOW) asks the firm for any information it used to determine property values so that residents may fully understand the methodology used in the process, which resulted in a “dramatic shifts in home values” in the Princetons.
   ”The impact of our recent revaluation has been a personal disaster for many. It also threatens to change the face of our town by ripping through neighborhoods of modestly priced homes and turning them unaffordable to longtime residents overnight,” the letter reads. “ASI is not responsible for market forces, and we understand your job is to value properties based solely on current housing prices. But given the dramatic shifts in home values, many residents have asked for a thorough explanation of how you calculated the new property assessments. It is imperative that our community understands the methodology used.”
   A copy of the letter was provided to The Princeton Packet by Township Committeewoman Liz Lempert. All members of both governing bodies signed the letter with the exception of Township Mayor Bernie Miller, who is out of town and unreachable, she said. The letter asks that the request is fulfilled by Aug. 15.
   The move follows a public meeting Monday night at which 200 Princeton residents turned out to express their frustration and anger over the results of the recent revaluation.
   In a session that at times became heated, they demanded an explanation of what they considered baffling discrepancies in assessments within neighborhoods as well as the apparent overall shift of the tax burden from more expensive to less expensive properties.
   Local officials could offer little more than sympathy, explaining that the power to change the outcome of the revaluation lies only with the county.
   Princeton Township residential properties nearly doubled in value on average under a revaluation completed earlier this year. The company assessed the roughly 5,000 properties in the township and 2,000 in the borough in an effort to bring all the properties up to market value.
   The 2010 average assessed value for residences in the township is $837,100, according to a tax impact analysis of its revaluation posted on Appraisal Systems’ website. Previously, the average assessed value was $431,700. In the borough, the average assessed residential property value for 2010 was $760,600, up from $351,800 in 2009. The last revaluation in both Princeton Township and Borough was conducted in 1996.
   ”The reason we had this revaluation is because if we didn’t, this room would have been full of people that were over-assessed,” tax assessor Neil Snyder said.
   But that wasn’t much consolation for those at the meeting who said they were struggling with tax bills that had increased by 50 percent. The sticker shock was even greater because the new assessment was retroactively applied for 2010, meaning that the bills residents had just received were adjusted to make up for the first two quarters, when residents were billed based on their previous assessment.
   During the meeting, which was presided over by former Princeton Township Mayor Jim Floyd in the Township Municipal Building, members of a citizen’s group that formed to investigate the results of the revaluation discussed their findings. Members of the public were also given a chance to speak and ask questions of officials.
   In his research in the John Witherspoon neighborhood, resident and realtor Jim Firestone said that he saw a pattern of small houses going up in value while large houses came down in value.
   He visited the neighborhood in an effort to help residents file appeals to their assessment, he said. He visited properties in detail, he said, and discovered “a lot of discrepancies and errors” in the assessments. He presented data from his study that indicated that large properties in good condition were assessed lower than smaller properties in poor condition.
   He called on local officials to provide a better explanation of the methodology and to help residents understand what can be done. Some residents of the neighborhood are in the process of meeting with Appraisal Systems in informal hearings to discuss their assessments.
   ”There is relief that’s on the way, but we need to work together with our assessor if we get more relief,” he said.
   Kip Cherry of Dempsey Avenue studied the area encompassing Valley Road, Mount Lucas Road and Ewing Street. Among her findings was an inconsistent correlation between size of lot and value of the property. The smaller the lot, the more the land was valued per acre, she said.
   ”By and large, almost every lot in our neighborhood was between $300,000 and $400,000, regardless of the size of the lot,” she said. “We were kind of scratching our heads and trying to figure out how that could be.”
   Mr. Snyder attempted to explain the process by which land was assessed, an issue raised not only by Ms. Cherry but several others who spoke. He explained that properties are given a “site value” for the simple presence of a home, and land is assessed at a diminishing value as the lots become larger. Whether a lot is large enough to potentially be subdivided cannot be considered in its assessment, he said.
   With little undeveloped land remaining in the township, the appraisal company used a “land abstraction method” to value parcels. By law, the assessment must break apart the value of the land and the value of the improvements, he said. Anomalies exist where the land that a small house sits on is worth less than the land of neighboring properties.
   ”We had to reduce the land value so we could create a house on it because it would have been a negative (value) for the house,” he said. “You can’t do that.”
   Deputy Mayor Chad Goerner, who himself saw a 21 percent tax increase, said that the “myriad of different factors” contributed to the assessment results, including the passage of 13 years since the last revaluation. Other local officials present included Ms. Lempert, Committeeman Lance Liverman and Borough Councilman Kevin Wilkes.
   ”During that period of time we had a tremendous growth in real estate value, and it’s incredibly frustrating to see the impact we’ve all experienced… It is truly frustrating for Township Committee,” Mr. Goerner said.
   The township was mandated by Mercer County Board of Taxation to contract a company to perform the assessment and has no say over the results, said. The committee met with the county before the results were released to see if the effect could be mitigated, to no avail, he said.
   ”We have basically no legal avenues to overturn or to mitigate some of the actual results, but what we can do is assist you in organizing into neighborhood groups, meeting with the assessor, petitioning the county to modify and change some of the issues that we’ve been discussing here this evening,” he said.
   He agreed with the speakers who pointed out problems with the assessment.
   ”There are a myriad of different anomalies and inaccuracies,” he said. “Granted, I would have expected that to happen when you’re going out and assessing over 5000 different properties. But when you see the impact on my community, your community, it’s incredibly heartbreaking.”
   Looking ahead, the township will continue to monitor existing sales data and coordinate with neighborhood groups to meet with the assessor of sales appear “out of whack,” he said.
   Representatives from Appraisal Systems Inc. were not present at Monday’s meeting, though the company’s CEO and vice president addressed residents’ questions for several hours at a joint meeting in March. Mr. Goerner said that the committee is petitioning the company to hold another meeting to address concerns over its methodology.
   Appraisal Systems Inc. is a state-approved contractor and was chosen to perform the revaluation after they submitted the lowest bid for the work, Mr. Snyder said. “I know you don’t want to hear this, but I’m very happy that they did it. They’re a very reliable company,” he said.
   The last year has been a “difficult time,” he said, but the township will continue to monitor sales and adjust assessments where necessary.
   ”Unfortunately, I cannot get emotions involved in assessing,” he added. “We can only look at what’s sold and trend in your neighborhood what has taken place based on sales. We have no idea why people buy and sell.”
   Data on the revaluation in the township and the borough is available online at http://asinj.com/.
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HERE IS THE FULL TEXT OF THE LETTER FROM PRINCETON MUNICIPAL OFFICIALS: