Wednesday, May 2, 2012

T&G - Ethics Commission wraps up complaint over Worcester assessor’s home. State panel ‘satisfied’ by review


WORCESTER —  The state Ethics Commission is taking no further action on a complaint regarding the significant drop in the assessed valuation of City Assessor William J. Ford’s home in recent years.

Mr. Ford was notified of the Ethics Commission’s action yesterday in a letter it sent him.

“As you know, we discussed with you a concern that your home’s assessed value had been significantly lowered in the past two years,” wrote Katherine E. Gallant, senior investigator for the commission. “Relying on what you told us and on any other necessary follow-up investigation and document review, we are satisfied that this matter does not require any further action on our part.”

Stephen Quist of June Street filed a complaint last month with the Ethics Commission in which he raised questions as to how Mr. Ford’s property valuation could go down by roughly $270,000 since he purchased the home in August 2010.

Mr. Quist pointed out that the valuation of Mr. Ford’s home at 360 Salisbury St. went down considerably, while the valuations for many other homeowners had at least stayed pretty much the same or had even gone up in some instances.

“It all begs the question of who’s guarding the henhouse?” Mr. Quist said when he filed his complaint.

Mr. Ford has also been the target of criticism from the citizens group, Accurate Worcester Assessments on Real Estate.

The group has pointed out that Mr. Ford’s home and property was assessed at $897,100 for fiscal 2010, the year in which he purchased it.

The assessment then dropped to $687,200 in fiscal 2011 and the new assessment is $620,000

The group pointed out that the land valuation of Mr. Ford’s 2.52 acres, which includes two half-acre buildable lots, is $66,500.

In comparison, the group said, the assessed land value of an abutting .56-acre on Surrey Lane is $100,4000, while the assessed land value for another .62-acre abutting property is $100,300.

Both those properties are within different neighborhood assessing codes than Mr. Ford’s property.

Commercial Properties, etc.

T&G - Commercial values going up in Worcester


WORCESTER —  The assessed valuations for most commercial and industrial properties will be going up by at least 10 percent — and significantly more in many instances — based on the “pending preliminary certification” the city received from the state Department of Revenue yesterday for commercial, industrial and mixed-used property values.

Of the city’s 2,278 commercial parcels, the assessed valuations for 317 will go up 10 percent to 20 percent; 498 will go up 20 percent to 40 percent; and 540 will go up 40 percent to 100 percent, according to city officials.

The valuations of 174 commercial properties will increase by more than 100 percent.

Of the 598 industrial properties in the city, the assessed valuation of 58 of those properties will increase by 10 percent to 20 percent; 98 properties will increase 20 percent to 40 percent; 101 properties will go up 40 percent to 100 percent.

The assessed valuations of 60 industrial properties will more than double.

City Manager Michael V. O’Brien said one of the key reasons for the dramatic increases is the removal of “manual overrides” in place for many years for those classes of properties.

While the assessed valuations for commercial properties were being updated as part of the city’s triennial property revaluation, it was discovered that assessors for years had been manually overriding valuations set by computer programs. As a result, when the computer-generated values were manually overridden, the new assessments often came out lower.

While assessments for residential properties are largely derived on the basis of sales of comparable properties, establishing valuations for commercial and industrial properties is much different: Assessors use the industry-standard income approach to generate a fair-market value. The income approach is most applicable to real estate that is normally bought and sold on the basis of its income-producing capabilities.

In the process of modernizing the city’s property revaluation systems, city assessors uncovered the practice of manual overrides on as many as 2,000, or roughly 40 percent, of the city’s commercial and industrial properties, according to the city manager. He said those overrides allow an assessor to manually enter a data element or formula into the assessment system and override the resultant valuation that should have been calculated by the system.

As a result, commercial and industrial property values would be based on an artificial override and not on the internal calculations of the system.

Mr. O’Brien said all of those manual overrides have been completely removed because they have no relevance based on the current parcel or market conditions.

He said another practice that was uncovered during the review was an “unjustifiable obsolescence” applied to a parcel.

He said functional and economic obsolescence entries ended up reducing the value of a property because of certain existing physical characteristics or conditions beyond the property itself, such as negative economic forces.

The city received “pending preliminary certification” of its residential property values in early April; certification of commercial and industrial property values was delayed upon the discovery of manual overrides.