Thursday, August 2, 2012

Womag - City Assessor: Palladium owners should know its value

The way Worcester assessor Bill Ford sees it, if you own property, you should know what it is worth. He believes that philosophy should apply to the owners of the beleaguered Palladium – home to a thriving heavy metal music scene, but in danger of being silenced permanently.

The city this year valued the property at 255-261 Main St. – which in addition to the Palladium includes office and retail space – at $2.3 million. That was slightly more than triple its assessed value of $688,700 in 2011. The tax bill more than doubled, from $23,863.46 in fiscal 2011 to $65,887.16 in fiscal 2012. Local attorneys John Fischer and John Sousa bought the building in 1990 for $1.3 million. Three years later, it was assessed at just $391,600. Until this year, it had been assessed two straight years at $688,700.

“In my opinion, they should know the value of their property,” Ford says. “If you bought something for $1.3 million, and it is assessed at $600,000, wouldn’t you think that was strange?”

Fischer doesn’t think so. He and Sousa have appealed their assessment, filing for an abatement of $494,904. No decision has been made yet on that request. At the same time, Fischer has made it clear he thinks the price tag is too steep. He and Sousa have openly questioned the future of the Palladium, going so far as to threaten demolition. Just last week, Fischer brought forward a request for a waiver from the city’s demolition delay ordinance. That measure requires a 12-month wait before historical property can be razed. The Historical Commission unanimously denied the waiver, ensuring the building will remain in place – for now.

As for why he never took issue with earlier, much lower assessments of his property, Fischer says, “It’s not uncommon for properties to be valued less than what they were purchased for.” Some have questioned how much the owners did to increase the value of the building, which Fischer admits is in need of “repairs and upgrades.” Ford raised that issue directly, saying, “The fact is the property owners did not properly maintain that building. (They) allowed the building to deteriorate, but now they say, ‘Wait. I have to tear the building down because you’re taxing me.’”

Worcester officials have made no secret of their opposition to any attempt to destroy the building and the Palladium. The Historical Commission’s vote provided added emphasis and followed a strong recommendation from Joel Fontane, director of the city’s Planning and Regulatory Services Division. He advised members to deny the waiver, saying, “Demolition of this historically significant structure would be detrimental to the architectural and historical resources of the city … and because the applicant has not demonstrated undue economic hardship.”

Mayor Joseph Petty has also taken a stance on the issue, telling Worcester Mag in a statement: “The Palladium is a unique destination and cultural venue in our city and it is our desire that this structure not be demolished.” He declined further comment “until the city assessor makes his final decision” on the abatement request.

The abatement, according to Chris Besaw, is “the key.” Besaw is general manager for Mass Concerts, which has booked shows at the Palladium since 1990. John Peters owns Mass Concerts, a major promoter of shows in arenas throughout New England. How big? In November 2000, under Peters’ guidance, Mass Concerts booked Prince at the Palladium, when the pop icon was performing mostly in theaters and small arenas. Fischer admits the Palladium would be a barren place without the promoter.

“Mass Concerts has been there for 12 years,” says Fischer. “He’s the person who has been keeping the place alive all that time.”

The next big show scheduled at the Palladium is Summer Slaughter Tour North America 2012 on Aug. 10. It will no doubt be music to the ears of heavy metal fans and supporters who do not want to see the building torn down. Among them is Jonathan Noble, a Worcesterite known for his participation in the grassroots movement, Occupy Worcester.

“We don’t have the most vibrant reputation outside Worcester,” Noble says. “What we are known for is pretty much being a nexus of the heavy metal scene.”

Noble and others can take some comfort in knowing the Palladium won’t be going anywhere in the immediate future. Fischer himself isn’t quite ready to write the building’s epitaph. “There’s more than a 50-50 chance it will be there next year at this time,” he says. “We’re going to keep it alive for the next year. Hopefully, word will get out and someone will see there’s a hell of an opportunity there.”

Monday, July 30, 2012

Telegram: Dust yet to settle on abatements

By Nick Kotsopoulos Politics and the City

The way things are trending, those Worcester property owners waiting to hear from city assessors about their real estate abatement applications may have more than a puncher’s chance of getting their property assessment knocked down a bit.

That’s because 55 percent of the abatement applications reviewed and acted on by city assessors through last Monday have been approved.

According to City Assessor William J. Ford, 383 abatements have been granted and processed, returning $483,927 to taxpayers. Another 14 abatement applications have been approved and are being processed, he said.

In comparison, 323 abatement applications have been denied.

Mind you, 2,395 property owners have challenged their fiscal 2012 assessments by filing for abatements and city assessors have only acted on roughly 30 percent of those applications. But the fact that 55 percent have been approved so far has to provide some hope to those still waiting to hear back on their challenge.

That’s not to say that the odds are in their favor but, hey, while a puncher’s chance may not be much, it is certainly better than no chance at all, as has been the case in other years.

Historically, abatement approval rates don’t often run more than 50 percent.

In 2010, for instance, only 34 percent (483) of the 1,432 abatement applications filed were approved, while in 2009 roughly 47 percent (844) of the 1,784 applications were granted, and in 2008 nearly 43 percent (406) of the 952 applications were approved, according to the assessor’s office.

Perhaps a better apples-to-apples comparison would be other triennial revaluation years such as this — those years when the city conducts full field reviews in updating the valuations of all properties.

In 2007, the city’s last triennial revaluation, 58 percent (342) of the 587 abatement applications were approved. In other triennial revaluation years, the approval rate was close to 50 percent; in 2004, 47 percent (196) of the 414 applications were approved, while in 2001, 49 percent (330) of the 679 applications were granted.

Of the 720 abatement applications that have been reviewed and acted on, a majority of them have dealt with residential properties (559), while far fewer commercial, industrial or apartment properties (148) and mixed-use properties (13) have been taken up

Wait until assessors act on the bulk of the 780 abatement applications that were filed for the latter two classes of properties; that is when things should really get interesting.


Because many of those properties were hit with major increases in their assessments, which, in turn, have caused their tax bills to skyrocket. In comparison, residential property assessments dropped 3.8 percent, on average, compared with the previous year.

Of Worcester’s 2,278 commercial parcels, the assessed valuations of 540 of them went up by 40 percent to 100 percent, while the assessment for 174 commercial properties increased by more than 100 percent.

Meanwhile, of the 598 industrial properties in the city, 101 properties shot up 40 percent to 100 percent, while 60 had their valuations more than doubled.

Just along the business corridor on the Southwest Cutoff, no fewer than 28 business property owners have filed for abatements, and in many instances their property assessments nearly doubled or more.

A business property at 37-69 Southwest Cutoff, for instance, saw its assessment jacked up from $2.1 million to $4 million, for an increase of 92 percent.

Another property at 126 Southwest Cutoff saw its assessed valuation skyrocket from $196,200 to $1 million, for a whopping 433 percent increase, while another business at 182 Southwest Cutoff saw its assessed valuation jump 106 percent, from $347,600 to $717,500.

The Southwest Cutoff isn’t the only major commercial corridor in which a number of business owners have filed abatement applications. The same is true along Main Street, Park Avenue, Shrewsbury Street, Southbridge Street, Grafton Street and Chandler Street.

In the downtown, many owners of office buildings have also filed for abatements, as have eight of the 11 major property owners on Front Street.

Many of the abatement applications for those properties have yet to be taken up by the assessors because they were submitted just before the June 25 filing deadline. It will be interesting, though, to see the outcome of all those abatement applications, because some pretty significant bucks will be at stake

The fact that the city has set aside $3 million to fund abatements and exemptions is an indication that city officials are well aware of what is involved. That is underscored by the fact that in the past 11 years the most the city ever paid out on abatements and exemptions was $917,004 in fiscal 2007, followed by $708,649 in fiscal 2009 and $702,389 in fiscal 2011.

Most other years, the city spent less than $500,000 on abatements and exemptions.

City assessors have until Sept. 25 to act on all abatement applications, but that doesn’t mean the process will end then.

Those taxpayers whose abatement requests were denied by the assessor will then have until Dec. 25 to file an appeal with the state Appellate Tax Board.

As a result, the city won’t really know the full impact of those appeals until sometime in January, and then the process before the Appellate Tax Board could be a long, drawn-out one.

In other words, it could be months, even years, before the dust settles on all the challenges to last fiscal year’s new property assessments.