A two-year advance in the timetable for the county’s next property tax revaluation has left Alamance County’s elected leaders a bit queasy about the decisions they’ll face when they get the results of this mass reappraisal in 2023.
This looming feeling of dread was very much in evidence this week when the county’s board of commissioners received a progress report on the upcoming revaluation from Alamance County’s tax administrator Jeremy Akins.
Akins had previously persuaded the commissioners to advance the revaluation’s original completion date from 2025 to 2023 in order to avoid losing hundreds of thousands of dollars in tax revenue from utility companies, whose property is evaluated by the state on a shorter cycle than the county’s traditional eight-year schedule.
This two-year acceleration in the revaluation schedule didn’t pose any concerns for the commissioners when they unanimously accepted the tax administrator’s suggestion in April. But the county’s governing board was less nonchalant when Akins returned with an update on the foreshortened revaluation during its latest regularly-scheduled meeting on Monday.
During his hour-long presentation to the commissioners, Akins conceded that his office has already wrapped up the revaluation’s initial research and planning phase – thanks, in part, to the assistance of a private contractor that the commissioners recently gave him leave to retain. Akins added that the tax office has started to compile a “schedule of values,” which will effectively serve as a pricing guide for the revaluation. He went on to assure the commissioners that everything is on track for the actual revaluation to start with an assessment of neighborhoods on March 1, 2022.
Akins said that, if all goes according to plan, the tax office should have the revaluation sewn up in time for the new tax values to go out to property owners in March of the following year. He added that the release of these figures will kick off a give-and-take process that will ultimately give property owners a chance to challenge the tax office’s appraisals.
Akins predicted that a fair number of area property owners will second guess their new tax values due to the runaway growth in real estate prices since the county’s last revaluation in 2017. The tax administrator noted that the website Zillow currently estimates the 4-year increase for residential property to be 55 and 54 percent for Burlington and Mebane respectively. He added that these figures square with the tax office’s own data, which show the growth in the local real estate market to be about 56.54 percent.
Akins acknowledged that, even under the best circumstances, his office is bound to make a few blunders in any county-wide mass reappraisal.
“No matter how hard we work, we will never know the citizens’ property better than they know their own property,” the county’s tax administrator added. “I am anticipating a lot of appeals, and one thing that becomes difficult is if you have a lot of appeals come in at once and you don’t have a method in place to funnel them through.”
Akins said that the tax office will strive to resolve as many disputes as it can administratively. He conceded, however, that some disagreements will require the intervention of a higher authority – which in this case is the county’s board of equalization and review.
Akins said that this appointed quasi-judicial body is tentatively slated to begin hearing appeals from the revaluation in May of 2023. He nevertheless added that it would be ideal for the board to convene even earlier so it can complete its work before the tax office issues bills based on the new tax values on July 21, 2023.
“I don’t think we will be done with appeals by then,” he went on to admit. “We will probably be handling appeals while bills are going out.”
The commissioners, for their part, have been eyeing an even early deadline – namely June 30, 2023, which is the due date for them to adopt a new annual budget based on the revaluation’s results.
Under state law, the commissioners are required to disclose the property tax rate that will enable the county to break even given the anticipated bump in property values following the county’s next mass reappraisal. The commissioners aren’t obligated to use this “revenue neutral” rate for the budget they approve in 2023. But the likelihood they’ll do so was all but confirmed on Monday by John Paisley, Jr., the chairman of Alamance County’s commissioners.
“Revenue neutral has meaning,” Paisley insisted. “So, we can lower the tax rate to take into consideration that increase in valuation.”
The board’s chairman nevertheless added that he and his colleagues may find it hard to settle on this break-even tax rate by the statutorily-mandated deadline given the large number of appeals that Akins expects the reval to generate.
“We have to set the tax rate prior to June 30 of that same year,” he added. “So, if people don’t know what their tax bills are, and we don’t have all these complaints yet, its going to make it kind of questionable whether we need to adjust the timeframe.”
In response to Paisley’s concerns, Akins acknowledged that the volume of appeals will very much be a moving target when his office sends out the new tax values in March of 2023. He added, however, that the level of uncertainty will plummet as the tax office hears back from property owners over the next several months.
“By the time that [the new tax rate] is set in June and billed in July,” he added, “we’ll have very good indicators on what appeals are doing.”
But the prospect of a reliable estimate in July offered little comfort to Paisley and his fellow commissioners, who will be obliged to set a new tax rate no later than June 30.
Commissioner Bill Lashley couched the board’s predicament in especially stark terms as he tried to explain the situation to his colleague Craig Turner, a one-time Naval officer who had flown F-14 fighter jets during his time in the service.
“For a jet fighter, it’s like firing from 6,000 miles away trying to fit in in a 3-foot window,” Lashley insisted. “This is going to be tough,” he added; “there’s so many variables we can’t put our finger on it.”
The board’s conundrum grew even thornier as Debra Bechtel, the county’s interim attorney, shot down a succession of ploys that the commissioners entertained to widen their metaphorical window – from a tax rate adjustment in the middle of the fiscal year to a rebate for taxpayers should the estimated revenue neutral rate prove too high.
The commissioners also attempted to persuade Akins to accelerate his timetable in order to buy them another month – or even a couple of weeks – to set a more accurate revenue neutral rate. Turner, for one, suggested that all would be well if the tax office simply sent out the new tax values in February, rather than March, of 2023.
“Any little bit of room can give us the information we need,” he insisted.
Akins assured the commissioners that three months which his current schedule allows to set a new tax rate will also suffice to give his office a good sense of the impact that the appeals will have on the county’s new tax values. He went on to warn that any attempt to hasten the process could be counterproductive unless the commissioners give him more contracted staff to finish the job sooner.
“If anything in that process, in the intent to finish faster, causes the quality of the work to fall, we could end up with worse values, which lead to more appeals,” the tax administrator declared.
“I’m certainly in favor of a longer window,” he added, “but we’re not staffed to do that. We can only do that at the expense of quality work…If the goal is to have more time to predict, and we want to keep our quality high, the only solution is to increase our resources.”