Thursday, October 11, 2012

Worcester Mag - Boxed out

by Walter Bird Jr.,  Oct 10, 2012

Larry Worrick was one of more than 2,000 homeowners or businesses filing a tax abatement request this year. He took the step believing he had been overcharged on his property taxes, figuring he would either get approved or denied. What he didn’t count on was getting both.

Worrick says he was initially notified his abatement had been denied. He was later told it had been approved. In between being denied and approved, Worrick says he had to battle the assessor’s office to get to the bottom of the snafu. It wasn’t until last week, he says, that he was told a check for $601 would be in the mail. Assessor Bill Ford says the whole thing was an honest mistake—that the person who assessed Worrick’s property checked the wrong box on his form.

Mistake or no, Worrick is irate and says he believes there is “something rotten in the assessor’s office.” He believes, had he not checked for himself, he would not have learned he was owed money. He says he is just as upset at how he claims officials have treated him as he fought to determine why he was denied abatement in the first place.

“I’d like an investigation of the whole department,” says Worrick, who claims he sent letters to all city councilors and the city manager. “I think it’s corrupt.”

That, says Ford, is ridiculous.

“Where is the corruption? Mistakes can occur, but that’s not corruption,” says Ford.

It all started, according to Worrick, when his property taxes increased by $601. He says he requested an assessment of his house, which was done near the end of June. He filed an abatement request on the basis of that assessment, believing his house had been overvalued. On Aug. 10, Worrick says, he was notified his request had been denied. At that point, he asked for a copy of the assessor’s report and was given what is called a field card. The card listed the current value of the house as $139,800—a decrease from the 2011 assessed value of $149,400. Worrick says he could not understand why the property value would go down, but he would be denied abatement.

“I spoke to Mr. Ford,” says Worrick, explaining that he was helped during the process by real estate agent Joan Crowell. She has sent out emails under the heading “AWARE,” or Accurate Worcester Assessments on Real Estate, detailing Worrick’s situation, but never naming him. Crowell says she helped other applicants file abatement requests.

“He was just sugar-coating everything,” Worrick says of Ford. “I pulled out the field report. He got extremely upset.”

A short while later, on Thursday, Aug. 23, Worrick says he went to see Ford at his office. The assessor was on the phone for over an hour and Worrick eventually left. He says he sent a letter to Chief Financial Officer Tom Zidelis and City Manager Mike O’Brien. Zidelis called him on Aug. 30 right before the Labor Day weekend, Worrick says, telling him he would call again the following Tuesday.

“He didn’t call,” Worrick says. “I called his office several times, and he never called back. Mr. O’Brien didn’t even have the decency to reply.”

In the meantime, Worrick says he mailed a letter on Oct. 1 to all city councilors. He says Councilor Rick Rushton called him and said he would speak with Zidelis. On Wednesday, Oct. 3, according to Worrick, Zidelis called him and said the city owed him an apology and that his abatement had been approved.

“Of 11 members of the council, [Rushton] is the only one who came through,” Worrick says.

Ford acknowledges a denial notice was sent to Worrick. That form informed Worrick his request had been denied by a vote of assessors. Ford says there was no vote because there is no three-person board—most large cities, he says, do not have them. The denial notice is a standard state form, Ford says, and was only sent because of an error made on the original application for abatement. At the bottom of the application, under the section for assessor’s use only, there are three boxes: Granted, Denied and Deemed Denied. A checkmark was inadvertently placed in the Denied box, Ford says, adding Worrick’s is the only case where that happened this year.

“It was a mistake,” he says, noting there are nearly 48,000 properties in the city.

“When you’re dealing with properties at the numbers we were doing, mistakes happen. We have a staff of nine people. Understand that accidents will happen.”

Ford’s office received 2,395 qualified abatement applications this year. Of them 1,112 were approved. When a denial is made, a crosscheck is performed to ensure it was accurate, he says. Ford disputes Worrick’s contention that no one would have noticed the error, saying: “We would have found it when we did the cross-check. We did the first two batches of denials before we did a cross-check, so he was sent a denial notice.”

Ford says Worrick should get his abatement check within four to six weeks. The checks are sent out of the treasurer’s office.

Wednesday, October 10, 2012 - City Bracing For Flood Of Tax Appeals

Adam Joseph Drici, GoLocalWorcester Contributor

The City Council approved the addition of a part-time Assistant City Solicitor last week to deal exclusively with the increased number of Appellate Tax Board cases expected after Worcester's real estate revaluation this year.

Nearly 2,400 tax abatements were filed this year, almost half of which were approved by City Assessor William Ford and his staff.

Ford said that his office did receive additional abatement applications, but they were all late filings received after the late June deadline. The City had 90 days, plus an additional 10 days under state law, to review and decide on the applications.
Filing With The Appellate Tax Board

Now that the City has worked through all the abatement filings and issued its approvals or denials, said Ford, property owners have 90 days to file with the state's Appellate Tax Board (ATB) if they still have issues with their final assessments.

The ATB is authorized by the Commonwealth to hold hearings and issue decisions on appeals for all state and local taxes, from property and real estate taxes to the sales taxes.

Filing with the board carries a fee that ranges from $10.00 for all property assessed at $20,000 or less to $100.00 for property with an assessed value between $100,000 and $1,000,00. Properties with assessed valuations in excess of $1,000,000 face a filing fee of $0.10 per $1,000 of assessed value with a minimum fee of $65.00 but not to exceed $5,000.

"I hate to see those people move forward with what they got assessed at," said Bill Breault, who sits on the Board of Directors at the Main South Community Development Corporation.

"I believe a lot of the businesses lawyered up, and they'll go to the state appellate board with theirs."

Some Worcester property owners have already begun the process.

George Valeri owns a commercial building at 26 Cambridge Street, which is home to a window company, an automotive repair company and a towing company. Valeri said the property's assessed value increased from $423,000 to $756,000 this year. An abatement later reduced the valuation by $30,000, but that was still too high for the property owner.

"It wasn't what I was looking for," said Valeri, the secretary of the Worcester Property Owners Association.

"If you do an income and expense analysis, it shows a value of about $300,000, and that's done by a third-party."

Valeri, who said he would be happy if his property was just returned to its old valuation, will not be hiring a lawyer and will instead represent himself for the ATB proceedings.

"This is nothing personal," he said. "It's survival."

Small Businesses Hit Hardest

Bill Vernon, the state director in Massachusetts for the National Federation of Independent Business, said the Commonwealth's dual tax rates for commercial and residential properties, first instituted through a ballot measure in the 1970s, already place an added burden on commercial property owners.

"When the valuation is off, that exacerbates the problem."

Worcester's fiscal year 2012 residential tax rate is $16.98 per $1,000 of assessed value. The city's commercial tax rate is $29.07 per $1,000 assessed valuation.

"Compared to some of their counterparts, it is lower," said Vernon.

In cities such as Lawrence and Holyoke, the commercial property tax rate is more than double the rate for residential properties.

Even though Worcester's commercial tax rate is on the low end of the spectrum, it still can take a toll on small businesses, especially if they see their property's valuation nearly double.

"What they're trying to do, frankly, is turn the property tax into an income tax," Vernon said.

But that plan can end up backfiring when the income generated by the commercial property cannot keep pace with its rising tax bill.

"What you get is less commercial property and less jobs and less economic activity."

Monday, October 8, 2012

T&G - Half of tax-cut requests granted


WORCESTER —  Roughly 46 percent of the real estate abatement applications filed for last fiscal year ended up being approved by city assessors.

According to City Assessor William J. Ford, 1,112 of the 2,395 abatement applications were granted and processed. That is the most since 2009, when 844 abatement requests, or roughly 47 percent of the applications filed, were approved.

He said the abatements totaled a little more than $3 million, which is about what the city had set aside to fund abatements and exemptions.

In comparison, 1,283 abatement applications were denied, he said.

Mr. Ford said city assessors were able to review within the three-month deadline set by state law all the abatement applications it received. In addition, the majorities of those properties were inspected, unless the homeowners refused the inspection or did not respond to the request.

He said his office had received additional abatement applications after the filing deadline in June, but state law prohibits review of those properties.

But the completion of the city’s review process does not mean the end of the appeal process.

Mr. Ford said property owners who are dissatisfied with the valuation determinations of the city’s Assessing Division have 90 days to file with the state Appellate Tax Board.

He said those commercial property owners who did not respond to the Section 38D Income and Expense requests as part of their abatement application with the city are not entitled to receive a review by the Appellate Tax Board.

The Massachusetts Appellate Tax Board is a quasi-judicial state agency designed to conduct hearings and render decisions on appeals of all types of state and local taxes, including property tax (both real estate and personal property), corporate excise, individual income tax, sale and use tax, and automobile and other excise taxes.

The most frequent type of appeal filed with the Appellate Tax Board is real estate tax appeals.

The filing fee to have a case heard by the Appellate Tax Board is based on the assessed valuation of the property.

If the assessed value is $20,000 or less, the filing fee is $10. If the assessed value is more than $20,000 and not in excess of $100,000, the filing fee is $50.

If the assessed value is more than $100,000 and not in excess of $999,999, the filing fee is $100.

Meanwhile, if the assessed valuation is $1 million or more, the filing fee is 10 cents per $1,000 of the assessed value, with a maximum filing fee of $5,000.

According to the Appellate Tax Board, taxpayers who claim their assessed property valuation is too high should be prepared to show that the fair market value of their property for last fiscal year is lower than the assessed value.

Because the assessed value of properties assigned by assessors is presumed by law to be valid, taxpayers bear the burden of proving that their property is overvalued.

In anticipation of increases in Appellate Tax Board cases, the City Council recently authorized the city manager to bolster the staffing in the city’s Law Department by adding a part-time assistant city solicitor position.

City Solicitor David M. Moore said the new position will be restricted to Appellate Tax Board cases.

He said given the expected volume of those cases, covering both commercial and residential property valuations, he felt it was best to obtain in-house expertise to reduce the potential expense of outside counsel.