MANVILLE: County tax board orders revaluation

Borough must put new values on property for 2016 bills

By Gene Robbins, Managing Editor
   Manville has been ordered by the county Board of Taxation to update property values to affect assessments for 2016 tax bills.
   The borough likely will hire a firm to do a door-to-door revaluation. The work will have to be done by the fall of 2015.
   The order came because Manville’s tax assessments were falling too far behind actual property values as reflected by actual sales. That spurred more owners to appeal assessments — an estimated 11 percent of the ratable base this year, county Tax Administrator Robert Vance said.
   Mayor Angelo Corradino and Manville argued that because real estate market was in such flux — years of falling values followed by a recent recovery of unknown extent — prices should stabilize before the borough went through the work and expense of a revaluation.
   If it had been up to Mr. Vance, he would have had Manville do the work sooner, at least to apply to 2015.
   Mayor Corradino said that delay was the correct move.
   ”By waiting, we do the right thing for residents who otherwise would have to pay for a revaluation now and again in five or six years,” he said. “That’s totally ludicrous.”
   By 2015, there should be development on the Rustic Mall property in the center of the borough. He said the borough still is negotiating with the owners over what will go on the lot. The owners want apartments; the borough wants a mixed use, with some retail and offices with residential, the mayor said.
   Manville’s equalization ratio — the comparison of tax assessments to actual sales — has been creeping up over the last few years. In 2012, it was 105 percent, moving up to a county-high 117 percent for the 2013. For next year, Manville’s ratio will be about 125 or 130 percent, a figure Mr. Vance called “unconscionable.”
   At 125 percent, a house that’s assessed at $250,000 should have an assessment of about $200,000, Mr. Vance said.
   Lower assessments won’t necessarily mean lower tax bills, Mr. Vance cautioned. When assessments go down, the tax rate usually goes up, and vice versa.
   It will mean assessments are “more realistic and defensible,” Mr. Vance said.
   Mr. Vance said Manville saw 244 appeals last year, and the figure rose to 390 this year. About 98 percent of the appeals are on residential properties, he said.
   By law, assessments can’t exceed market value, according to the state constitution, he said.
   The high number of appeals hurts the borough because it has to reduce assessments to successful appellants in mid-year, which brings in fewer dollars in the last quarter of the year and hurts the local operating budget, Mr. Vance said. The borough gave back $257,000 last year, he said, and it could refund more than $300,000 this year.
   That all argued for a faster solution to the problem, he said.
   ”They can’t afford to wait for the market to recover to bury the issue,” Mr. Vance said. “There’s no sound basis to that. It’s where we failed to see eye to eye.”
   A revaluation comes with a cost that would run into six figures. Hillsborough went through a revaluation in 2011 for the tax year 2012 at a cost of $800,000; it chose to spread the expense over five years.
   But the amount of annual year-end deductions, which Mr. Vance insists is tantamount to a refund, equals or exceeds the estimated cost of conducting a full revaluation, according to March meeting minutes.
   Mayor Corradino said Mr. Vance’s figures were too high, and that in no way were refunds given, just reduced tax bills in the last quarter of the year.
   Manville went through a revaluation in 2005, the mayor said. It likely will hire a firm in 2014 to complete the work by the fall of 2015 and have the revised figures apply to 2016 tax bills. The borough cannot afford to hire fulltime assessor to develop the “rolling assessment” program Mr. Vance would like to see adopted.
   Generally, in such a program, the borough is divided into tax zones with revised values applied to some part of the borough every year. In that way, assessments wouldn’t fall too far behind the actual market.
   In March, the county tax board held a lengthy discussion of the issue. Martin Allen, attorney for tax appeals in Manville, said borough officials were unsure whether the real estate market had stabilized and were adapting a “wait and see” posture.
   ”He also indicated that the same officials were concerned about the morale of the property owners in the town, which might be damaged at the realization, through a revaluation, that their property values had gone down significantly,” the minutes of the meeting read.