In the Thursday, December 6, 2007, Madison Eagle newspaper, page B-7, Section 111 - Legal Notices: "Message from the Board of Supervisors Regarding Real Estate Reassessments" a copy of real estate reassessment Frequently Asked Questions (FAQ) was offered. On Saturday, December 8, 2007, we requested a copy of the FAQ via e-mail and received it promptly at the opening of business, Monday, December 10, 2007.
For your convenience that copy is presented below. No changes were intentionally made to the text other than to change font, and add spacing, color, and bolding to make it more legible on the Internet. The Malvern Club, Inc, and its Board members are not responsible for the content, only the presentation. If you have any questions about the content, contact the office or individual as indicated in the FAQ below. If you have any questions about the presentation, contact the Webmaster, email link below.
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Process and Procedure
Q: When was the last reassessment? How often is a reassessment conducted?
A: The last general reassessment for Madison County took place three years ago, in 2004, and was effective for the 2005 tax year. The Virginia Code (58.1-3252) requires every county to conduct a general reassessment of real estate at least every four years. Reassessment must be performed more often if the assessed value falls below 70 percent of the market value.
Q: Who actually performs the reassessment for Madison County?
A: The County is required to have a professional assessor conduct its reassessments, one who meets requirements established by the State Department of Taxation. The Board of Supervisors has no input or influence in the establishment of land values through the reassessment process. Real estate assessments in Madison County have been administered by the Blue Ridge Mass Appraisal Company, LLC under a contract for services with the County. The Commissioner of Revenue has the responsibility to work closely with the professional assessor to ensure that assessments are based on accurate parcel and land use information.
Q: What is the reassessment process?
A:
1. The Commissioner of Revenue provides the professional assessor with information regarding each lot, parcel or tract of land within the County.
2. Over a period of approximately 12 months, the professional assessor assigns field inspectors to visit each property to verify data provided by the Commissioner and to collect any additional data that might be relevant.
3. Data is entered into a mass appraisal database/system and accuracy validated.
4. Neighborhood sales, land values, yearly appreciation trends and other data are analyzed throughout the process. The professional assessor divides the County into "neighborhoods" for purpose of market comparison, and then based on current market information each property is assigned a current fair market value. State law requires each property to be assessed at 100% of fair market value. (Va. Code 58.1-3201).
5. When the general reassessment is completed, property owners are notified by mail.
6. Informal meetings with representatives of the professional assessment firm are made available on request of a property owner, to allow individual property owners to ask questions and seek correction of any obvious errors. Property owners who continue to disagree with the new assessed value of their property after this informal meeting may appeal to the Board of Equalization appointed by the Circuit Court. The Board of Equalization will hold hearings in early 2008.
Q: When should I have received my assessment notice?
A: Notices of assessment were sent out by mail in the middle of November 2007. The County meets its notice obligations by mailing the reassessment notice to the last known address of a property owner. If you have not received your notice it may be that you have changed your address and you have not notified the Commissioner of Revenue. Or, if your address of record is in care of a mortgage lender, it may be that the lender received your notice and failed to forward it to you. If you have not yet received a reassessment notice in the mail, it is your responsibility to contact the Commissioner of Revenue.
Q: How do I appeal my reassessment if I think it is erroneous?
A: By law, neither the County Board of Supervisors nor the County Administrator can change property assessments. Citizens wishing to have their assessments reviewed may follow the appeals process outlined below.
1. Blue Ridge Mass Appraisals Review (the contract assessor)
If you wish to ask questions regarding your re assessment, the first step is to call 540 948-7500 Ext. 157, or appear in person at the County Administration building, 414 N. Main Street, and make an appointment to speak to the professional assessor's representative. He or she may be able to answer all of your questions satisfactorily.
2. Board of Equalization
If your initial review does not satisfy your concerns, you may appeal to the County's Board of Equalization, a group of citizens appointed by the Circuit Court Judge. The hearing dates and times for the Board of Equalization will be advertised in the local newspaper and will take place in early 2008. To prevail at a hearing before the Board of Equalization, a taxpayer must demonstrate that his property is (i) valued at more than its fair market value; (ii) that the general reassessment is not uniform in its application; or (iii) that the valuation determined by the assessor was based on mistaken facts (including errors in acreage) or was otherwise not arrived at in accordance with accepted appraisal practice. Requests for applications for Board of Equalization appeal should be addressed to the Commissioner of Revenue; phone 540-948-7500 ext. 107 or write to: Commissioner of Revenue, P.O. Box 56, Madison, VA 22727
3. Circuit Court
If your questions or objections are not answered through informal discussion with the assessor or through appeal to the Board of Equalization, you may appeal to the Circuit Court of Madison County, see Va. Code 58.1-3984 and 58.1-3989.
Q: I just had my property appraised: can I use that appraisal to contest the value assigned to my property in the reassessment process?
A: Any materials that may assist the assessors in gaining an accurate portrait of your property may be used to support your position at the hearings, including the results of a property-specific appraisal that you may have obtained. However, for an appraisal to accurately reflect market conditions, however, it must have been conducted within the past 6 months.
Relationship of Reassessments to County Taxes
Q: My property value increased. Does that mean my tax bill will increase?
A: An increase in the value of an individual's property does not necessarily mean that property taxes will be increased. Once a reassessment is completed the tax rate must be adjusted (equalized) to offset the effects of the reassessment. (Code of Virginia 58.1-3321) The Board of Supervisors can only increase the tax rate above the adjusted rate if they hold a public hearing. Once an adjusted tax rate is computed, the Board of Supervisors may then discuss as part of its annual budget process whether to raise or lower that rate to provide revenues to meet the County's fiscal needs.
Q: What happens if the county does not assess real property at or near fair market value?
A: Every locality is required by state law to assess real estate at 100% of fair market value. (Va. Code 58.1-3201. A number of state funding sources are tied to the accuracy of a locality's property assessments. If the County's sales assessment ratio falls below 70% in a given year, state funding can be reduced or even withheld. (Va. Code 58.1-3259).
Q: How Is My Tax Bill Calculated From My Assessment?
A: Tax rates are expressed in dollars per one hundred dollars of assessed value. For example, in 2007 a tax rate of 59 cents per $100 would result in a real estate tax of $2,360 on a property assessed at $400,000. (0.59 x (400,000/100)) = .59 x 4,000 = $2,360
Determination of Individual Parcel Values
Q: May I review the assessor's records for my property?
A: Yes. All property appraisal cards or sheets within the custody of the Commissioner of Revenue or the professional assessor are open for inspection by a property owner after the notices of reassessment have been mailed to property owners. Additionally, any taxpayer, or his authorized representative, whose real property has been assessed for taxation is allowed to examine the working papers used by the assessing official in arriving at the assessed value of that person's land and the improvements thereon. (Va. Code 58.1-3331). To make arrangements to review any of this information, a property owner should contact the Commissioner of Revenue during normal business hours, Monday-Friday, 8:30 a.m. - 4:30 p.m. 948-7500 (x105).
Q: How is my property assessment different than a private appraisal?
A: Madison, the same as other localities, reassesses real estate using mass appraisal methods. Since the County's assessments depend on the reconciliation of all sales occurring in a 12-month period in a particular area, an assessment represents a typical, or average, value for a property in relation to other property values. A private appraisal will always be more detailed and may be done for a specific purpose. A private appraisal determines the value for a specific property on a certain date, usually based on recent sales of a few comparable properties. The private appraisal may be made for a variety of purposes, such as for purchase or sale, mortgage financing, a home equity loan, an estate settlement, income tax purposes, etc. and therefore it is not always a valid means for evaluating a general reassessment.
Q: How could my property assessment be different than the sales price recently paid for it?
A: Assessments are based on typical values within neighborhoods. While the sale price of a property will affect its assessment, the effect will be diluted by the mass appraisal methods which consider all sales within a neighborhood in determining assessed values. Also, the assessor primarily uses sales occurring within a 12-month period prior to the assessment date. A consequence of this is that the assessments of properties which have sold very recently may differ from the earlier sales prices by a marked amount when real estate markets are changing rapidly.
Q: How do trends in real estate prices affect assessments?
A: Assessments are not based on large area sales activity like county-wide trends. The professional appraiser divides the County into smaller "neighborhoods" for purposes of conducting market comparison analysis. The assessment for a particular property is based on the sales activity and prices paid for property in that immediate "neighborhood" area.
Q: Does parcel size affect the assessment?
A: Parcel sizes do affect assessed values, but not as much as some people may think. Residential land is assessed by building site, where the utility of property is a chief determinant of value. A lot which is 20 percent larger than another is not necessarily 20 percent more valuable if each lot can serve only as a single home site. The additional value of the larger lot will usually be less than 20 percent greater than the smaller lot. This means that the larger lot will be assessed less per acre than the smaller lot.
Q: What is a "home site" and how is it valued?
A: For market comparison purposes, the professional assessor analyzes property sales by dividing each property into a one-acre "Home Site" or "House Site," and then adding the value of that site to the value of any additional acreage of that property. In so doing valuation consistency is maintained amongst grouping of similarly located parcels. All property having less than 20 acres, and not zoned or utilized as commercial or industrial property, is classified as "residential."
Q: Do the actions of neighbors affect the assessed value of other properties?
A: At times, property owners have asked that assessments reflect the presence of less-than-desirable neighbors - such as residents who may be loud, or have abandoned cars on their property, or fail to mow their lawn regularly, etc. Usually these activities of neighboring property owners will not affect the assessment of a property because they are considered transitory - neighbors come and go, while other economic variables such as house construction, neighborhood boundaries, lot size may remain relatively constant.
Q: Must the property owner allow an interior inspection of his or her home when contesting an assessment?
A: No. However, appraisers cannot address conditions of which they are not aware. An exterior inspection of a home will provide much information about the property, but it will certainly fall short of a complete review. And, the outcome of a contested assessment could be affected by the lack of verifiable information.
Q: What causes property values to change?
A: A property's value can change for a number of reasons: market value changes, physical changes, such as additions, garages, remodeling; or damage or destruction; to name just a few. However, the most frequent cause of change in value results from a change in the market value.
Q: What is the Real Estate Land Book?
A: Real estate assessments are a matter of public record; for each parcel of real estate, the name of the owner(s), the amount of the assessment, and the taxes levied are recorded in a Land Book prepared and maintained by the County's Commissioner of Revenue (Gale Harris). Copies of the Land Book are kept in the offices of the Commissioner of Revenue, the Treasurer, and the Clerk of the Circuit Court. Anyone is free to examine the Land Book to compare assessments and taxes of properties.
Q: What is the average increase for Madison 2007 Real Estate Assessments?
A: On average, Madison County experienced a real estate sales price increase over the three year period (from summer of 2004 to summer of 2007) of 51 percent. Therefore, assessments for 2007 show that overall real estate values in Madison are up an average of 17 percent per year.
Tax Relief
Q: Are certain individuals or properties exempt from taxes or can they have their taxes reduced or deferred?
A: Some real estate is exempt from taxation. The Constitution of Virginia and the Code of Virginia control these exemptions. Pursuant to the provisions of a local ordinance, certain persons who are 65 years old or permanently disabled may have real estate taxes on their home in Madison County exempted or deferred, if they have income or financial assets below a certain threshold. Information on Madison County's Real Estate Tax Relief program may be obtained by calling the Commissioner of Revenue at (540) 948-7500 Ext. 105.
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