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Contractor’s review of commercial tax values dampens enthusiasm for battle with big boxes

An all-out war with some of the nation’s top big box retailers seems to have lost favor with the head of Alamance County’s tax office since he first broached the idea to the board of commissioners last fall.

The county’s tax administrator Jeremy Akins shared a much more dovish perspective on Monday when he briefed the commissioners on the 10 retail locations that he had previously said may have been inadvertently lowballed during the county’s latest mass revaluation of property.

Alamance County’s tax administrator Jeremy Akins

Akins had originally identified these potential revaluation errors in October after persistent questions from a former commissioner candidate forced him to rethink the assessed value of the Lowe’s Home Improvement outlet in Burlington. Akins went on to request permission to hire a contractor to reappraise these 10 sites as a possible precursor to a legal battle against the owners of these commercial properties.

The tax administrator’s initial hints of a bout with the big boxes struck an immediate chord with some of the commissioners, who engaged in a fair amount of saber-rattling after Akins approached them about his suspicions last fall.

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The commissioners went on to authorize Akins to hire a firm called Newmark Valuation and Advisory Services to go over the county’s own in-house assessments and suggest any needed revisions.

Yet, the high hopes that the county’s leaders had once entertained were effectively dashed when Akins returned with the results of these contracted appraisals on Monday. As the county’s tax administrator acknowledged, these second opinions were far from the silver bullets which he had envisioned.

“Of the 10 values under review,” Akins declared, “five were determined to be correct…Two showed a small amount of variance…and three showed a significant amount of variance.”

Akins conceded that, by Newmark’s calculations, the cumulative value of the tax office’s errors amounted to no more than $14,932,801.  He added that this discrepancy comes to about .06 percent of the county’s entire property tax base of nearly $25.4 billion, while the net loss in annual property tax receipts is roughly $64,500, or .about 0002568 cents on the tax rate.

“For the average homeowner, that is 68 cents a year,” the tax administrator added, “and that helps me to picture the scale of the impact.”

Akins cautioned the commissioners that, should they instruct him to adopt Newmark’s appraisals, the owners of the affected properties are all but certain to appeal to North Carolina’s Property Tax Commission. He added that the county would have to hire a team of specialists to defend the new tax values before the commission, whose final ruling could take years to obtain – with no guarantee that the county would prevail in the end.

Akins insisted that, even in the best case scenario, this protracted appeals battle would only add about $25,000 a year to the county’s coffers – a savings of some 9 cents per annum to the average taxpayer.

“But there is a pessimistic scenario where our legal fees would exceed our revenues,” he admitted. “In that case, the county would engage in a multi-year battle and receive a net loss.”

Akins went on to predict a five-year turnaround for any appeal that goes before the Property Tax Commission. He added, however, that all of these parcels will ultimately be reassessed in the county’s next mass revaluation, which is scheduled to take place in 2027.

“Odds are the next reval will be done before the appeal,” he said.

The tax adminis-trator’s caveats about the potential cost of this battle didn’t seem to dampen the fighting spirit of commissioner Pam Thompson.

“I don’t like this,” she said as she contemplated the undervalued properties. “I don’t think we should cave to anything because our residential folks have paid a lot of this…I just want this to be fair to everybody.”

Yet, in the end, the prevailing mood among the commissioners was more aptly summed up by their chairman John Paisley, Jr., whose thoughts lingered on the legal bills that the county may ultimately incur.

“I agree with everyone here that we have to be fair,” he said, “but we also have to be smart about how we spend the money.”

See earlier coverage on commissioners’ consideration over whether to “go to war” against Big Box stores over revaluation property values:

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