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Monday, May 21, 2012
GoLocalWorcester: Worcester Not Tracking Business Growth
Walter Bird Jr., GoLocalWorcester Reporter
A GoLocalWorcester investigation uncovered Worcester does not know exactly how many new businesses have popped up in the last year or in the last five years in the city, for that matter. The reason: the city doesn't track new businesses through the clerk's office.
Since Jan. 1, there have been 299 business certificates obtained through City Hall. Finding out how many of these businesses are new, however, isn’t as easy as you might think. Currently the city doesn not track how many new businesses open up each month or even each year in the city.
Under the city’s current system, there is no way of knowing which are new companies. To find out, you’d have to cross check the lists from each year – a time-consuming task an already busy city hall staff doesn’t perform.
GoLocalWorcester looked at the business certificates purchased through City Clerk David Rushford from Jan. 1 through May 15, going back two years. The number has risen steadily each year: from 181 in 2010, to 267 in 2011 to 299 this year. But as Rushford pointed out, his department issues the certificates and keeps a public record of them; neither he nor his staff is responsible for determining which were issued to new businesses and which are being renewed.
No one’s responsibility
“We can’t do that,” said Rushford. “It isn’t our function. Our role is confined to the filing of certificates. They’re filed in a public database and anyone who may want to look at that information, or who wants to help small businesses, the information is there.”
It’s there, in a dropdown menu under “Search Public Records” on the city’s Web site. The problem is city officials don’t appear to be searching it.
“We don’t look at business certificates,” Chief Development Officer Timothy McGourthy said. “There are over 6,000 businesses in Worcester, 10,000 according to some counts. Business certificates don’t indicate much in terms of what businesses are in Worcester. It isn’t in any way reflective of the amount of business in the city.”
Starting out
Tell that to Maureen Carroll, a 2011 Worcester State University grad who has been unable to find a job despite sending out 37 resumes since January. Having no luck, Carroll decided to take matters into her own hands and start a cleaning business.
“I have the time and I have the experience of marketing and outreach,” said Carroll, a double major in urban studies and geography who graduated magna cum laude. “It’s not my career goal, but something I can do on my own. It’s a rough world for graduates.”
So Carroll paid for a business certificate to start Heritage Cleaning Solutions, something with low overhead and start-up costs, since it costs just $50 for a business certificate and materials and equipment can be bought relatively inexpensively. As of Tuesday, Carroll was the latest to obtain a certificate from city hall.
“If no one else will hire me, I’ll hire me,” Carroll told GoLocalWorcester. “I’m not going to lie down and die and wet my pants because I can’t find a job.”
Certificates required
Business certificates are filed every four years, as required by state law, for individuals Doing Business As a particular name. They are commonly referred to as DBA’s. Incorporated businesses do not file business certificates with the city. Their records are kept on a state level and some publications list them by city and town. Multiple businesses setting up shop in the same building would also not be reflected on the list of business certificates. The city, McGourthy said, collects data on a piece of property and would have information on a particular building. But corporations operating inside that building would be filed with the state.Not every business filing a certificate would qualify as “small.” One of the filers, for example, was National Grid.
Also worth noting is there is no requirement for a filer to note whether the business is new or simply filing a renewal.
According to Philip Niddrie, the city's Business Retention Manager, the Economic Development Office has been trying to change that, and had asked the city clerk's office to make a notation on each certificate for which businesses were new or refiling. It was, he said, an informal process.
"I haven't gotten any this month," Niddrie said.
There's a reason for that. According to Rushford, state law does not allow him to make any entries on business certificates other than what is allowed. The law currently has no requirement for noting whether a business is new or refiling.
"It was requested, but we don't do that," said Rushford. "I think we did it for two weeks. I'm all about having data available that will be useful. But the law states exactly what is to be placed on the certificate. I cannot add anything to it."
‘Word of mouth’
How, McGourthy was asked, does the city keep track of all new businesses?
“A lot of it is word of mouth,” McGourthy said. “We look at new stores, new activity on the development scene, and try to highlight it as an example of Worcester business activity.”
The Economic Development office publishes a yearly review. The most recent, entitled “Economic Development: 2011 Year in Review,” includes a section that highlights many of the new businesses that emerged last year. The report was authored by McGourthy, City Manager Michael O’Brien and Director of Business Assistance Paul Morano. In the introduction of the report, it reads, in part: “Worcester also welcomed a mix of exciting new commercial establishments, including Nuovo Restaurant, Zorba’s Taverna, Woo Berry, Still and Stir, Anytime Fitness, and Aldi Food Market.”
The report features a list of 35 new food, retail, commercial and entertainment venues, such as New Chef Ho Restaurant, Fried Chicken, Webster Square Vision Center and California Nail.
Who will be on next year’s list is yet to be determined. It probably won’t feature Heritage Cleaning Solutions, because that business isn’t being run out of a storefront. Staying afloat and rising above other new businesses will no doubt be challenging for Carroll. Even McGourthy acknowledges part of the reason the business certificate, or DBA, list isn’t referenced is because most of the companies are “a small percentage of the businesses out there.”
The city does, McGourthy added, try to incorporate all information when analyzing the overall success of businesses in Worcester. One such tool to help do so is Worcester Business Research Alliance, which includes the city and nine other area organizations. That group is holding a seminar for new, start-up businesses on May 23 at Worcester Polytechnic Institute as part of National Small Business Week. The free event runs from 7:30-9:30 a.m. in Alden Memorial Hall and will offer advice and assistance to small business owners and entrepreneurs.
Keeping track
The issue of tracking new businesses is an interesting one, according to Stephen Eide, senior research associate with the Worcester Regional Research Bureau. That organization does not keep statistics on new businesses, he said. He acknowledged that some businesses, such as the one Carroll has started, may not receive as much attention.
“These are interesting questions because not all businesses are equal,” he said, noting the city also does not keep track of businesses that close.
With the tools it has, the city does its best, according to McGourthy.
“We’re constantly interacting with businesses at all levels. It’s not that we don’t use every bit of data,” McGourthy said. “But we’re trying to stay on top of all these businesses while recognizing our limited resources.”
That said, McGourthy acknowledged his department might be able to make better use of business certificates when it comes to analyzing new businesses in the city.
“It’s something we can look at and see if we can use them more,” McGourthy said. “We have better experience connecting with companies through word of mouth, outreach and various business groups.”
There is a use for business certificates, according to Richard Kennedy, president and CEO of the Worcester Regional Chamber of Commerce. There is also a need.
“I believe there could be a better way (of tracking new business),” Kennedy said. “That’s probably not a bad idea. You have to have a pretty good reach into the community. But a business certificate could be used, whether it reflects the lion’s share of business in the city or not. Maybe they could call another community and say, ‘How do you track this?’”
A GoLocalWorcester investigation uncovered Worcester does not know exactly how many new businesses have popped up in the last year or in the last five years in the city, for that matter. The reason: the city doesn't track new businesses through the clerk's office.
Since Jan. 1, there have been 299 business certificates obtained through City Hall. Finding out how many of these businesses are new, however, isn’t as easy as you might think. Currently the city doesn not track how many new businesses open up each month or even each year in the city.
Under the city’s current system, there is no way of knowing which are new companies. To find out, you’d have to cross check the lists from each year – a time-consuming task an already busy city hall staff doesn’t perform.
GoLocalWorcester looked at the business certificates purchased through City Clerk David Rushford from Jan. 1 through May 15, going back two years. The number has risen steadily each year: from 181 in 2010, to 267 in 2011 to 299 this year. But as Rushford pointed out, his department issues the certificates and keeps a public record of them; neither he nor his staff is responsible for determining which were issued to new businesses and which are being renewed.
No one’s responsibility
“We can’t do that,” said Rushford. “It isn’t our function. Our role is confined to the filing of certificates. They’re filed in a public database and anyone who may want to look at that information, or who wants to help small businesses, the information is there.”
It’s there, in a dropdown menu under “Search Public Records” on the city’s Web site. The problem is city officials don’t appear to be searching it.
“We don’t look at business certificates,” Chief Development Officer Timothy McGourthy said. “There are over 6,000 businesses in Worcester, 10,000 according to some counts. Business certificates don’t indicate much in terms of what businesses are in Worcester. It isn’t in any way reflective of the amount of business in the city.”
Starting out
Tell that to Maureen Carroll, a 2011 Worcester State University grad who has been unable to find a job despite sending out 37 resumes since January. Having no luck, Carroll decided to take matters into her own hands and start a cleaning business.
“I have the time and I have the experience of marketing and outreach,” said Carroll, a double major in urban studies and geography who graduated magna cum laude. “It’s not my career goal, but something I can do on my own. It’s a rough world for graduates.”
So Carroll paid for a business certificate to start Heritage Cleaning Solutions, something with low overhead and start-up costs, since it costs just $50 for a business certificate and materials and equipment can be bought relatively inexpensively. As of Tuesday, Carroll was the latest to obtain a certificate from city hall.
“If no one else will hire me, I’ll hire me,” Carroll told GoLocalWorcester. “I’m not going to lie down and die and wet my pants because I can’t find a job.”
Certificates required
Business certificates are filed every four years, as required by state law, for individuals Doing Business As a particular name. They are commonly referred to as DBA’s. Incorporated businesses do not file business certificates with the city. Their records are kept on a state level and some publications list them by city and town. Multiple businesses setting up shop in the same building would also not be reflected on the list of business certificates. The city, McGourthy said, collects data on a piece of property and would have information on a particular building. But corporations operating inside that building would be filed with the state.Not every business filing a certificate would qualify as “small.” One of the filers, for example, was National Grid.
Also worth noting is there is no requirement for a filer to note whether the business is new or simply filing a renewal.
According to Philip Niddrie, the city's Business Retention Manager, the Economic Development Office has been trying to change that, and had asked the city clerk's office to make a notation on each certificate for which businesses were new or refiling. It was, he said, an informal process.
"I haven't gotten any this month," Niddrie said.
There's a reason for that. According to Rushford, state law does not allow him to make any entries on business certificates other than what is allowed. The law currently has no requirement for noting whether a business is new or refiling.
"It was requested, but we don't do that," said Rushford. "I think we did it for two weeks. I'm all about having data available that will be useful. But the law states exactly what is to be placed on the certificate. I cannot add anything to it."
‘Word of mouth’
How, McGourthy was asked, does the city keep track of all new businesses?
“A lot of it is word of mouth,” McGourthy said. “We look at new stores, new activity on the development scene, and try to highlight it as an example of Worcester business activity.”
The Economic Development office publishes a yearly review. The most recent, entitled “Economic Development: 2011 Year in Review,” includes a section that highlights many of the new businesses that emerged last year. The report was authored by McGourthy, City Manager Michael O’Brien and Director of Business Assistance Paul Morano. In the introduction of the report, it reads, in part: “Worcester also welcomed a mix of exciting new commercial establishments, including Nuovo Restaurant, Zorba’s Taverna, Woo Berry, Still and Stir, Anytime Fitness, and Aldi Food Market.”
The report features a list of 35 new food, retail, commercial and entertainment venues, such as New Chef Ho Restaurant, Fried Chicken, Webster Square Vision Center and California Nail.
Who will be on next year’s list is yet to be determined. It probably won’t feature Heritage Cleaning Solutions, because that business isn’t being run out of a storefront. Staying afloat and rising above other new businesses will no doubt be challenging for Carroll. Even McGourthy acknowledges part of the reason the business certificate, or DBA, list isn’t referenced is because most of the companies are “a small percentage of the businesses out there.”
The city does, McGourthy added, try to incorporate all information when analyzing the overall success of businesses in Worcester. One such tool to help do so is Worcester Business Research Alliance, which includes the city and nine other area organizations. That group is holding a seminar for new, start-up businesses on May 23 at Worcester Polytechnic Institute as part of National Small Business Week. The free event runs from 7:30-9:30 a.m. in Alden Memorial Hall and will offer advice and assistance to small business owners and entrepreneurs.
Keeping track
The issue of tracking new businesses is an interesting one, according to Stephen Eide, senior research associate with the Worcester Regional Research Bureau. That organization does not keep statistics on new businesses, he said. He acknowledged that some businesses, such as the one Carroll has started, may not receive as much attention.
“These are interesting questions because not all businesses are equal,” he said, noting the city also does not keep track of businesses that close.
With the tools it has, the city does its best, according to McGourthy.
“We’re constantly interacting with businesses at all levels. It’s not that we don’t use every bit of data,” McGourthy said. “But we’re trying to stay on top of all these businesses while recognizing our limited resources.”
That said, McGourthy acknowledged his department might be able to make better use of business certificates when it comes to analyzing new businesses in the city.
“It’s something we can look at and see if we can use them more,” McGourthy said. “We have better experience connecting with companies through word of mouth, outreach and various business groups.”
There is a use for business certificates, according to Richard Kennedy, president and CEO of the Worcester Regional Chamber of Commerce. There is also a need.
“I believe there could be a better way (of tracking new business),” Kennedy said. “That’s probably not a bad idea. You have to have a pretty good reach into the community. But a business certificate could be used, whether it reflects the lion’s share of business in the city or not. Maybe they could call another community and say, ‘How do you track this?’”
T&G: Worcester residential values down. Real estate tax bill $11.3B
By Nick Kotsopoulos TELEGRAM & GAZETTE STAFF
WORCESTER — The total assessed value for all taxable property in the city has reached $11.3 billion.
The figure, which is based on the city assessor’s opinion of value for all taxable properties as of Jan. 1, 2011, is 6 percent higher than the city’s total valuation for the previous fiscal year, according to city assessors.
The city’s total valuation for fiscal 2011, which ended June 30, was $10.85 billion. The high water mark for the city’s valuation came in 2008, when it reached $12.7 billion.
The increase is fueled in large part by a 25 percent average increase in the assessed valuations of commercial properties, and a nearly 28 percent average increase in industrial properties.
Meanwhile, the average valuations for residential properties, with the exception of apartment buildings, all dropped.
Since 1984, the city has set separate tax rates for residential and commercial-industrial properties, with the latter tax rate often more than double the residential rate.
The City Council will hold its annual tax classification hearing at 7 p.m. tomorrow night in the Esther Howland Chamber. At that time, it will also set the fiscal 2012 tax rates.
Through tax classification, which shifts the tax burden between the two classes of property, the lowest possible residential tax rate that could be adopted by the council is $14.50.
That would translate into an annual tax savings of $435, on average, for homeowners, according to city assessors.
Meanwhile, adoption of the lowest residential tax rate would also translate into a tax rate of $35.57 for commercial and industrial properties and an average tax increase of nearly $4,500.
According to assessors, residential properties now account for 72.3 percent of the city’s overall tax base, while commercial-industrial properties account for 27.7 percent.
That is in contrast to the previous fiscal year, when the breakdown was 78 percent residential properties and 22 percent commercial-industrial.
Significant increases in the valuation of commercial and industrial properties are a major reason why business properties now account for a greater percentage of Worcester’s overall tax base.
According to the assessor, the average assessed valuation of single-family homes has dropped 3.5 percent, to $198,061.
Meanwhile, the average assessed values for condominiums has dropped 7.2 percent ($118,884); two-family homes have dropped 7.6 percent ($186,579); and three-family homes have fallen 4.3 percent ($187,413).
There were 24,811 single-family homes in Worcester, 4,960 condominiums, 3,607 two-family homes and 4,874 three-family homes.
Apartment buildings, which went up 1.26 percent, for an average valuation of $618,162, were the only residential component to have an increase in assessed valuation.
In comparison, assessed valuations for commercial properties rose by 25.1 percent, on average. The 2,332 commercial properties in Worcester have an average assessed valuation of $821,138.
Industrial properties, meanwhile, had assessed valuations that increased by 27.9 percent on average. The 611 industrial properties in the city have an average assessed valuation of $947,499, according to assessors.
WORCESTER — The total assessed value for all taxable property in the city has reached $11.3 billion.
The figure, which is based on the city assessor’s opinion of value for all taxable properties as of Jan. 1, 2011, is 6 percent higher than the city’s total valuation for the previous fiscal year, according to city assessors.
The city’s total valuation for fiscal 2011, which ended June 30, was $10.85 billion. The high water mark for the city’s valuation came in 2008, when it reached $12.7 billion.
The increase is fueled in large part by a 25 percent average increase in the assessed valuations of commercial properties, and a nearly 28 percent average increase in industrial properties.
Meanwhile, the average valuations for residential properties, with the exception of apartment buildings, all dropped.
Since 1984, the city has set separate tax rates for residential and commercial-industrial properties, with the latter tax rate often more than double the residential rate.
The City Council will hold its annual tax classification hearing at 7 p.m. tomorrow night in the Esther Howland Chamber. At that time, it will also set the fiscal 2012 tax rates.
Through tax classification, which shifts the tax burden between the two classes of property, the lowest possible residential tax rate that could be adopted by the council is $14.50.
That would translate into an annual tax savings of $435, on average, for homeowners, according to city assessors.
Meanwhile, adoption of the lowest residential tax rate would also translate into a tax rate of $35.57 for commercial and industrial properties and an average tax increase of nearly $4,500.
According to assessors, residential properties now account for 72.3 percent of the city’s overall tax base, while commercial-industrial properties account for 27.7 percent.
That is in contrast to the previous fiscal year, when the breakdown was 78 percent residential properties and 22 percent commercial-industrial.
Significant increases in the valuation of commercial and industrial properties are a major reason why business properties now account for a greater percentage of Worcester’s overall tax base.
According to the assessor, the average assessed valuation of single-family homes has dropped 3.5 percent, to $198,061.
Meanwhile, the average assessed values for condominiums has dropped 7.2 percent ($118,884); two-family homes have dropped 7.6 percent ($186,579); and three-family homes have fallen 4.3 percent ($187,413).
There were 24,811 single-family homes in Worcester, 4,960 condominiums, 3,607 two-family homes and 4,874 three-family homes.
Apartment buildings, which went up 1.26 percent, for an average valuation of $618,162, were the only residential component to have an increase in assessed valuation.
In comparison, assessed valuations for commercial properties rose by 25.1 percent, on average. The 2,332 commercial properties in Worcester have an average assessed valuation of $821,138.
Industrial properties, meanwhile, had assessed valuations that increased by 27.9 percent on average. The 611 industrial properties in the city have an average assessed valuation of $947,499, according to assessors.
T&G: Council tax battle looming
Nick Kotsopoulos Politics and the City
The adage “better late than never” is certainly apropos when it comes to setting Worcester’s fiscal 2012 tax rates.
With just six weeks left to this fiscal year, the City Council will finally get around to setting this year’s residential and commercial-industrial tax rates Tuesday night. The tax classification hearing is scheduled for 7 p.m. in the Esther Howland Chamber.
That became possible when the state Department of Revenue late last week finally certified Worcester’s new property valuations that resulted from its triennial property revaluation — a process that ended up taking some two years to complete.
Mind you, the City Council normally sets the tax rates in November or early December at the latest, but this has been anything but a normal year when it comes to getting the DOR to certify the city’s property values.
Now, the fun begins — that being the setting of the tax rates. And this exercise should be anything but routine.
With many business property owners reeling from dramatic increases in their assessments, the local business community sees this as a golden opportunity to try to bring greater balance between the residential and commercial-industrial tax rates, which have been skewed heavily in favor of homeowners for years and years.
More often than not, the commercial-industrial rate has been more than double the residential tax rate. Last fiscal year, for instance, the residential rate was $16.06 per $1,000 valuation while the commercial-industrial rate was $34.65.
While the business community has had relatively little success over the years getting the City Council to bring the tax rates more into balance, things could be much different this time around.
Interestingly, while some individual business owners have spoken out about their skyrocketing property valuations, business leaders in general have not bad-mouthed the city’s property revaluation process. That’s because they fully understand that property assessments are just one factor in the mix; the other just as important factor is the tax rate.
In the end, all that matters is the bottom line — that being what is owed in property taxes.
You kind of get the feeling that business leaders will take the higher property assessments if it means getting a lower tax rate in return.
The higher commercial and industrial assessments have already worked in favor of business property owners, as several city councilors have signaled they will not consider the lowest residential tax rate allowed under tax classification for this fiscal year.
They fear that voting the highest possible tax rate for commercial and industrial properties, combined with the skyrocketing assessments, would place a tremendous tax burden on many businesses.
Indeed, if the council voted the lowest residential tax rate, property taxes for commercial and industrial properties would go up by nearly $4,500 on average, while homeowners would see their tax bill decrease by $435 on average, according to city assessors.
“It doesn’t take a math whiz to figure out that with the lowest residential tax rate, commercial tax bills would go through the roof,” said Councilor-at-Large Frederick C. Rushton.
All of which means that the City Council will have to adopt a set of tax rates that shifts more of the tax burden on to homeowners so businesses don’t get over-burdened with tax increases.
But how far will the City Council go?
And, is it fair to make homeowners pay more in taxes than they otherwise would have had to pay in order to minimize the tax increases for business property owners? After all, if more than 2,000 business properties had been under-assessed for years, as city officials have said, an argument could be made that those businesses weren’t paying their fair share, at the expense of residential property owners.
Councilor-at-Large Konstantina B. Lukes, who has traditionally voted for the lowest residential tax rate, said setting this year’s tax rates will be one of the most difficult decisions this council will have to make.
She acknowledged that adopting the lowest residential tax rate could cripple many businesses, but she does not want to see homeowners have to bear the burden through higher taxes. At a recent council meeting, Mrs. Lukes suggested that homeowners be asked to pay no more of an increase in their property taxes than what they paid the previous year.
But there is no need to even consider that. The tax rates adopted by the council for fiscal year 2011 produced an average tax increase of $178 for homeowners; if the council was to adopt a residential tax rate that generated that kind of tax increase again, the corresponding commercial-industrial tax rate would lower the annual tax bill for business property owners by $178 on average, according to assessors
You know that’s not going to happen. City councilors are going to want business property owners to pay some kind of tax increase if homeowners are going to be paying more in taxes.
The chances seem very good that the commercial-industrial rate will go below $30; just how far though remains to be seen. If the council adopted a residential rate of $16.64 and a corresponding commercial-industrial rate of $29.98, the average tax bill for homeowners would go down by about $11, while the tax increase for business property owners would be about $1,274, according to assessors.
Given that, there seems to be room for the council to go well below a $30 commercial-industrial rate. For instance, a $17.20 residential tax rate and a corresponding commercial-industrial rate of $28.30 would leave homeowners with an average tax increase of $115 and business property owners with an average tax increase of $306, according to assessors.
Such a scenario would make the local business community ecstatic because it would make a significant dent in the imbalance that has existed between the two tax rates.
Yes, something good may actually come out of the skyrocketing assessment increases for the business community.
The adage “better late than never” is certainly apropos when it comes to setting Worcester’s fiscal 2012 tax rates.
With just six weeks left to this fiscal year, the City Council will finally get around to setting this year’s residential and commercial-industrial tax rates Tuesday night. The tax classification hearing is scheduled for 7 p.m. in the Esther Howland Chamber.
That became possible when the state Department of Revenue late last week finally certified Worcester’s new property valuations that resulted from its triennial property revaluation — a process that ended up taking some two years to complete.
Mind you, the City Council normally sets the tax rates in November or early December at the latest, but this has been anything but a normal year when it comes to getting the DOR to certify the city’s property values.
Now, the fun begins — that being the setting of the tax rates. And this exercise should be anything but routine.
With many business property owners reeling from dramatic increases in their assessments, the local business community sees this as a golden opportunity to try to bring greater balance between the residential and commercial-industrial tax rates, which have been skewed heavily in favor of homeowners for years and years.
More often than not, the commercial-industrial rate has been more than double the residential tax rate. Last fiscal year, for instance, the residential rate was $16.06 per $1,000 valuation while the commercial-industrial rate was $34.65.
While the business community has had relatively little success over the years getting the City Council to bring the tax rates more into balance, things could be much different this time around.
Interestingly, while some individual business owners have spoken out about their skyrocketing property valuations, business leaders in general have not bad-mouthed the city’s property revaluation process. That’s because they fully understand that property assessments are just one factor in the mix; the other just as important factor is the tax rate.
In the end, all that matters is the bottom line — that being what is owed in property taxes.
You kind of get the feeling that business leaders will take the higher property assessments if it means getting a lower tax rate in return.
The higher commercial and industrial assessments have already worked in favor of business property owners, as several city councilors have signaled they will not consider the lowest residential tax rate allowed under tax classification for this fiscal year.
They fear that voting the highest possible tax rate for commercial and industrial properties, combined with the skyrocketing assessments, would place a tremendous tax burden on many businesses.
Indeed, if the council voted the lowest residential tax rate, property taxes for commercial and industrial properties would go up by nearly $4,500 on average, while homeowners would see their tax bill decrease by $435 on average, according to city assessors.
“It doesn’t take a math whiz to figure out that with the lowest residential tax rate, commercial tax bills would go through the roof,” said Councilor-at-Large Frederick C. Rushton.
All of which means that the City Council will have to adopt a set of tax rates that shifts more of the tax burden on to homeowners so businesses don’t get over-burdened with tax increases.
But how far will the City Council go?
And, is it fair to make homeowners pay more in taxes than they otherwise would have had to pay in order to minimize the tax increases for business property owners? After all, if more than 2,000 business properties had been under-assessed for years, as city officials have said, an argument could be made that those businesses weren’t paying their fair share, at the expense of residential property owners.
Councilor-at-Large Konstantina B. Lukes, who has traditionally voted for the lowest residential tax rate, said setting this year’s tax rates will be one of the most difficult decisions this council will have to make.
She acknowledged that adopting the lowest residential tax rate could cripple many businesses, but she does not want to see homeowners have to bear the burden through higher taxes. At a recent council meeting, Mrs. Lukes suggested that homeowners be asked to pay no more of an increase in their property taxes than what they paid the previous year.
But there is no need to even consider that. The tax rates adopted by the council for fiscal year 2011 produced an average tax increase of $178 for homeowners; if the council was to adopt a residential tax rate that generated that kind of tax increase again, the corresponding commercial-industrial tax rate would lower the annual tax bill for business property owners by $178 on average, according to assessors
You know that’s not going to happen. City councilors are going to want business property owners to pay some kind of tax increase if homeowners are going to be paying more in taxes.
The chances seem very good that the commercial-industrial rate will go below $30; just how far though remains to be seen. If the council adopted a residential rate of $16.64 and a corresponding commercial-industrial rate of $29.98, the average tax bill for homeowners would go down by about $11, while the tax increase for business property owners would be about $1,274, according to assessors.
Given that, there seems to be room for the council to go well below a $30 commercial-industrial rate. For instance, a $17.20 residential tax rate and a corresponding commercial-industrial rate of $28.30 would leave homeowners with an average tax increase of $115 and business property owners with an average tax increase of $306, according to assessors.
Such a scenario would make the local business community ecstatic because it would make a significant dent in the imbalance that has existed between the two tax rates.
Yes, something good may actually come out of the skyrocketing assessment increases for the business community.
Friday, May 18, 2012
GoLocalWorcester: Questions Answered – and Raised – over Worcester Property Values
By Walter Bird Jr., GoLocalWorcester Reporter
City councilors wanted answers regarding the mystery surrounding the manual overrides of property valuations being blamed for this year’s sky-high assessments.
“We’re in limbo,” said At-Large Councilor and former Mayor Konstantina Lukes. “I’m not sure it’s any clearer than before.”
Lukes spoke to GoLocalWorcester after a marathon session that saw councilors tackle the first part of City Manager Michael O’Brien’s fiscal 2013 budget, before heading into a regular council meeting. There, the City Manager tried to explain why so many property values – during the city’s triennial revaluation – have doubled, tripled and, in some cases, quadrupled.
O’Brien was armed with a report councilors had been anxiously awaiting. But it ended up raising a lot of questions. For example, the council had asked for a list of the approximately 2,000 valuations of commercial and industrial properties that O’Brien had said were manually overridden by the city’s previous assessor. O’Brien provided records from 1998 – one year before current Assessor William Ford came on board – detailing 2,155 properties for which an override was entered.
Manual overrides are a legal practice used to account for any number of factors in a valuation, such as a change of building use or for a property that had become vacant. According to O’Brien, the overrides were done in two main categories: Functional Obsolescence and Economic Obsolescence. The former refers to a reduction in property value due to an inability to perform the function for which it was designed. The latter is a reduction in the value of a property because of effects, events or conditions not controlled by the current use or condition of the property.
In an accompanying report provided to councilors, O’Brien pointed out that the percentage adjustments for economic and functional obsolescence were, in some cases, as high as 100 percent. Some councilors have questioned the overrides. No specifics
The problem, at least for Lukes, was that the report O’Brien put forth did not mention specific properties or their owners. Instead, properties were identified by their location on a city map, their block and lot.
“I wanted names,” Lukes said. “I wanted property owners, not blocks and lots.”
What she walked away with instead, Lukes said, was the feeling that “there’s another player here.” She was referring to the Massachusetts Department of Revenue (DOR), the agency Councilor George Russell previously accused of forcing the city to adopt a new valuation method that he said inflated property valuations. The DOR has denied any such action, while acknowledging it played a huge part in reviewing the assessing systems and their ultimate overhaul.
In his accompanying report to the council, O’Brien said, “The Commonwealth’s Department of Revenue’s (DOR) oversight was present throughout this process, conducting detailed data quality reviews of all categories and classes of properties. I am confident that based on this extensive undertaking and the checks and balances that have been put into place, that this is the most current and consistent assessment database and system we have had as a City.”
DOR involved
In addition to asking for a list of the manually overridden properties, councilors had also asked for a report on the legal responsibility of the DOR. In his report, O’Brien said the DOR’s Bureau of Local Assessment “is responsible for regulation, oversight, training and technical assistance to cities and towns in the areas of real and personal property valuation and classification. Consequently, one of the main duties of the Bureau is to review and re-certify each municipality's property values once every three years to ensure they are at full and fair market value.”
Based on the DOR’s apparently close involvement, Lukes does not believe there was anything illegal about the manual overrides.
“I think if something was illegal, there would have been action taken,” Lukes said. “I’ve been poking around, but I’m only scratching the surface. But I don’t believe there was anything illegal.”
Former Assessor Bob Allard has denied any wrongdoing and has refuted assertions that he performed more than 2,000 manual overrides.
City councilors wanted answers regarding the mystery surrounding the manual overrides of property valuations being blamed for this year’s sky-high assessments.
“We’re in limbo,” said At-Large Councilor and former Mayor Konstantina Lukes. “I’m not sure it’s any clearer than before.”
Lukes spoke to GoLocalWorcester after a marathon session that saw councilors tackle the first part of City Manager Michael O’Brien’s fiscal 2013 budget, before heading into a regular council meeting. There, the City Manager tried to explain why so many property values – during the city’s triennial revaluation – have doubled, tripled and, in some cases, quadrupled.
O’Brien was armed with a report councilors had been anxiously awaiting. But it ended up raising a lot of questions. For example, the council had asked for a list of the approximately 2,000 valuations of commercial and industrial properties that O’Brien had said were manually overridden by the city’s previous assessor. O’Brien provided records from 1998 – one year before current Assessor William Ford came on board – detailing 2,155 properties for which an override was entered.
Manual overrides are a legal practice used to account for any number of factors in a valuation, such as a change of building use or for a property that had become vacant. According to O’Brien, the overrides were done in two main categories: Functional Obsolescence and Economic Obsolescence. The former refers to a reduction in property value due to an inability to perform the function for which it was designed. The latter is a reduction in the value of a property because of effects, events or conditions not controlled by the current use or condition of the property.
In an accompanying report provided to councilors, O’Brien pointed out that the percentage adjustments for economic and functional obsolescence were, in some cases, as high as 100 percent. Some councilors have questioned the overrides. No specifics
The problem, at least for Lukes, was that the report O’Brien put forth did not mention specific properties or their owners. Instead, properties were identified by their location on a city map, their block and lot.
“I wanted names,” Lukes said. “I wanted property owners, not blocks and lots.”
What she walked away with instead, Lukes said, was the feeling that “there’s another player here.” She was referring to the Massachusetts Department of Revenue (DOR), the agency Councilor George Russell previously accused of forcing the city to adopt a new valuation method that he said inflated property valuations. The DOR has denied any such action, while acknowledging it played a huge part in reviewing the assessing systems and their ultimate overhaul.
In his accompanying report to the council, O’Brien said, “The Commonwealth’s Department of Revenue’s (DOR) oversight was present throughout this process, conducting detailed data quality reviews of all categories and classes of properties. I am confident that based on this extensive undertaking and the checks and balances that have been put into place, that this is the most current and consistent assessment database and system we have had as a City.”
DOR involved
In addition to asking for a list of the manually overridden properties, councilors had also asked for a report on the legal responsibility of the DOR. In his report, O’Brien said the DOR’s Bureau of Local Assessment “is responsible for regulation, oversight, training and technical assistance to cities and towns in the areas of real and personal property valuation and classification. Consequently, one of the main duties of the Bureau is to review and re-certify each municipality's property values once every three years to ensure they are at full and fair market value.”
Based on the DOR’s apparently close involvement, Lukes does not believe there was anything illegal about the manual overrides.
“I think if something was illegal, there would have been action taken,” Lukes said. “I’ve been poking around, but I’m only scratching the surface. But I don’t believe there was anything illegal.”
Former Assessor Bob Allard has denied any wrongdoing and has refuted assertions that he performed more than 2,000 manual overrides.
GoLocal Worcester: Worcester Could Face Flood of Abatement Requests After Tax Bills
By Walter Bird Jr., GoLocalWorcester Reporter
It’s safe to say many Worcester taxpayers are sitting on pins and needles waiting for the city to set the tax rate. Likewise, city officials are bracing for what could be a mountain of tax abatement requests from unhappy customers.
“I think so, yes,” At-Large Councilor and former Mayor Konstantina Lukes said when asked whether she thought taxpayers might be biting their nails. “And there’s a more intense advocacy for a more favorable rate for businesses. Instead of the same predictable folks, we’re seeing a lot of different people.”
Pressure Is On
That puts the pressure on councilors during next week’s tax classification hearing. However it turns out, most appear in agreement on one issue: City Hall is going to be swimming in abatement requests once customers get their bills. They have 30 days to file for an abatement, which is when a homeowner appeals the new tax rate given to them by the city.
“We’re going to have a ton of requests, absolutely,” said At-Large Councilor Joseph O’Brien, another former mayor, who believes the city should ready itself by beefing up staff “as much as necessary” so taxpayers can send their requests.
There could be another wrinkle. Lukes said the city has its next tax classification hearing in November, saying, “There may be two sets of abatement requests within six months.”
High Number Expected
While the exact number remains to be determined, the city projects between 1,600-2,000 abatement requests this year. Those who are successful will be paid out of an overlay reserve account. The assessor raises money in that account to cover abatements and exemptions that meet state requirements. According to Christina Andreoli, spokesperson for City Manager Michael O’Brien, abatements are granted when real or personal property has been overvalued or disproportionately valued.
There was $3.9 million budgeted for overlay in fiscal 2012, according to figures Andreoli supplied to GoLocalWorcester. In fiscal 2011, that amount was $3.11 million. In fiscal 2010, $2.75 million was budgeted. The figures did not include how much was spent.
‘Considering’ Abatement
Several businesses throughout Worcester have already learned their property values, which in some cases increased by more than 100 percent. In extreme cases, such as with Saint-Gobain, values shot up more than 400 percent. That company could be among those seeking an abatement. Worcester businesses can expect to find their new property bills in the mail in the coming weeks.
“Anybody in the 100-percent-plus range is certainly at least considering it,” said Richard Kennedy, president and CEO of the Worcester Regional Chamber of Commerce.
A company like Saint-Gobain, from whom Kennedy is retired, needs to consider all its properties. The 400-percent increase was for just one parcel.
“First of all, you can’t file (an abatment) until you get your tax bill and pay it," Kennedy said.
Staying Positive
District 4 City Councilor Sarai Rivera said she is maintaining a positive attitude – even though she is positive there will be a high number of abatement requests.
“Definitely a lot of people are going to apply,” said Rivera, who also thinks a good number of those requests will be granted. “I think with a couple people I talked to, yes, I think they will be successful. The numbers are just so very different. I mean we’re talking way over-the-top increases. I would imagine there would be a measure of success.”
O’Brien agreed, saying: “From my perspective, I think we’re going to have a high number of requests, and looking at some of the numbers, we’re going to see a high success rate.”
Another Bill
Taxpayers face more than the prospect of high tax bills. They’re also going to be hit with the first-quarter fiscal 2013 bill in July. That prospect has generated some talk over whether the city should delay sending out that bill. Councilors are not unaware of the financially dire straits in which many homeowners and businesses find themselves.
Rivera said she would support a delay in sending out first-quarter bills, if the city is allowed under state law. Massachusetts Department of Revenue spokesperson Robert Bliss was not immediately aware of the laws governing tax bills.
“If it’s something within our power, yes,” said Rivera. “I would support anything that will help our business owners or residents.”
Added Lukes: “Seventy percent of the property in the city is in escrow with a mortgage. They may not feel a hit, but what about those who have no mortgage or escrow and are paying for this right out of their pocket? There has been discussion on delaying the first-quarter bill. We haven’t spent a whole lot of time on it. We’re not going to make a hard and fast rule. This is probably a once-in-a-lifetime event.”
It’s safe to say many Worcester taxpayers are sitting on pins and needles waiting for the city to set the tax rate. Likewise, city officials are bracing for what could be a mountain of tax abatement requests from unhappy customers.
“I think so, yes,” At-Large Councilor and former Mayor Konstantina Lukes said when asked whether she thought taxpayers might be biting their nails. “And there’s a more intense advocacy for a more favorable rate for businesses. Instead of the same predictable folks, we’re seeing a lot of different people.”
Pressure Is On
That puts the pressure on councilors during next week’s tax classification hearing. However it turns out, most appear in agreement on one issue: City Hall is going to be swimming in abatement requests once customers get their bills. They have 30 days to file for an abatement, which is when a homeowner appeals the new tax rate given to them by the city.
“We’re going to have a ton of requests, absolutely,” said At-Large Councilor Joseph O’Brien, another former mayor, who believes the city should ready itself by beefing up staff “as much as necessary” so taxpayers can send their requests.
There could be another wrinkle. Lukes said the city has its next tax classification hearing in November, saying, “There may be two sets of abatement requests within six months.”
High Number Expected
While the exact number remains to be determined, the city projects between 1,600-2,000 abatement requests this year. Those who are successful will be paid out of an overlay reserve account. The assessor raises money in that account to cover abatements and exemptions that meet state requirements. According to Christina Andreoli, spokesperson for City Manager Michael O’Brien, abatements are granted when real or personal property has been overvalued or disproportionately valued.
There was $3.9 million budgeted for overlay in fiscal 2012, according to figures Andreoli supplied to GoLocalWorcester. In fiscal 2011, that amount was $3.11 million. In fiscal 2010, $2.75 million was budgeted. The figures did not include how much was spent.
‘Considering’ Abatement
Several businesses throughout Worcester have already learned their property values, which in some cases increased by more than 100 percent. In extreme cases, such as with Saint-Gobain, values shot up more than 400 percent. That company could be among those seeking an abatement. Worcester businesses can expect to find their new property bills in the mail in the coming weeks.
“Anybody in the 100-percent-plus range is certainly at least considering it,” said Richard Kennedy, president and CEO of the Worcester Regional Chamber of Commerce.
A company like Saint-Gobain, from whom Kennedy is retired, needs to consider all its properties. The 400-percent increase was for just one parcel.
“First of all, you can’t file (an abatment) until you get your tax bill and pay it," Kennedy said.
Staying Positive
District 4 City Councilor Sarai Rivera said she is maintaining a positive attitude – even though she is positive there will be a high number of abatement requests.
“Definitely a lot of people are going to apply,” said Rivera, who also thinks a good number of those requests will be granted. “I think with a couple people I talked to, yes, I think they will be successful. The numbers are just so very different. I mean we’re talking way over-the-top increases. I would imagine there would be a measure of success.”
O’Brien agreed, saying: “From my perspective, I think we’re going to have a high number of requests, and looking at some of the numbers, we’re going to see a high success rate.”
Another Bill
Taxpayers face more than the prospect of high tax bills. They’re also going to be hit with the first-quarter fiscal 2013 bill in July. That prospect has generated some talk over whether the city should delay sending out that bill. Councilors are not unaware of the financially dire straits in which many homeowners and businesses find themselves.
Rivera said she would support a delay in sending out first-quarter bills, if the city is allowed under state law. Massachusetts Department of Revenue spokesperson Robert Bliss was not immediately aware of the laws governing tax bills.
“If it’s something within our power, yes,” said Rivera. “I would support anything that will help our business owners or residents.”
Added Lukes: “Seventy percent of the property in the city is in escrow with a mortgage. They may not feel a hit, but what about those who have no mortgage or escrow and are paying for this right out of their pocket? There has been discussion on delaying the first-quarter bill. We haven’t spent a whole lot of time on it. We’re not going to make a hard and fast rule. This is probably a once-in-a-lifetime event.”
Wednesday, May 16, 2012
T&G: Lowest residential taxes unlikely in Worcester. Fear of burdened businesses
By Nick Kotsopoulos TELEGRAM & GAZETTE STAFF
WORCESTER — With many business owners reeling from dramatic increases in their property assessments, some city councilors are signaling that the lowest residential tax rate allowed under tax classification is not in the cards this fiscal year.
They said that may have to be the case because the highest possible tax rate for commercial and industrial properties, combined with the skyrocketing assessments, would place a tremendous tax burden on many businesses.
“It doesn’t take a math whiz to figure out that with the lowest residential tax rate, commercial tax bills would go through the roof,” said Councilor-at-Large Frederick C. Rushton.
“We have to figure out what we’re going to do with this situation,” he added. “The way I’m reading the tea leaves, if we vote the lowest residential tax rate it would send a true shock to the business community. We have to be cognizant of the cause and effect of the tax rates we eventually set because the bottom line is what the final bill ends up being.”
Since the early 1980s, the city has set separate tax rates for residential and commercial-industrial properties, as is allowed under tax classification.
The City Council has adopted the lowest residential tax rate in several of those years, and in all years the residential tax rate has been significantly lower than the commercial-industrial rate.
Adoption of the lowest residential tax rate translates into the highest possible tax rate for commercial and industrial properties.
Pending final certification of the city’s triennial property revaluation, the City Council hopes to finally be able to set the tax rates for this fiscal year on May 22.
Councilor-at-Large Konstantina B. Lukes, who has traditionally voted for the lowest residential tax rate, said setting the rates for this fiscal year will be one of the most difficult decisions the council will have to make.
While acknowledging that adoption of the lowest residential tax rate could cripple many businesses, she said she does not want to see homeowners have to bear the burden through higher taxes as a way to correct past assessing practices.
Mrs. Lukes has suggested that homeowners be asked to pay no more of an increase in their property taxes than what they paid the previous year.
“We’re all going to get blamed for this,” Mrs. Lukes said. “We find ourselves having to correct the culmination of a series (of assessing) missteps.”
District 5 Councilor William J. Eddy, meanwhile, said setting the tax rates should not come down to pitting homeowners against business owners, as seems to happen every year.
“We’re one community,” Mr. Eddy said. “We have to make a decision on the tax rate that ensures our residents have a livable city.”
District 1 Councilor Tony Economou said he fears a higher tax rate for business properties could unravel all the progress that has been made in the city the past several years.
“We have to look at all options going forward,” he said. “These kinds of tax increases simply cannot be absorbed by many businesses.”
But District 2 Councilor Philip P. Palmieri, who has already indicated that he is leaning toward once again supporting the lowest residential tax rate, said it is an issue of fairness.
He said homeowners should not be asked to pick up a greater share of the tax burden to compensate for many business properties being under-assessed for so long.
“This is a problem no one had anticipated, certainly not of this magnitude,” Mr. Palmieri said. “I’ve always committed to the lowest residential tax rate and will probably remain that way. Residents shouldn’t have to carry the full burden.”
District 3 Councilor George J. Russell, who has questioned the method used to assess commercial and industrial properties, said he has always advocated for tax rates that favor the homeowner.
“My fear is that the council is going to shift the tax rate to the homeowner to somehow make up for an assessment process that does not reflect accurate values,” Mr. Russell said.
Of the city’s 2,278 commercial parcels, the assessed valuations for 317 have gone up 10 percent to 20 percent; 498 went up 20 percent to 40 percent; and 540 went up 40 percent to 100 percent, according to city officials.
Meanwhile, the valuations of 174 commercial properties have increased by more than 100 percent.
Of the 598 industrial properties in the city, the assessed valuations of 58 of those properties have increased by 10 percent to 20 percent; 98 properties went up by 20 percent to 40 percent and 101 properties shot up 40 percent to 100 percent.
In addition the assessed valuations of 60 industrial properties have more than doubled.
Meanwhile, residential property assessments have decreased by 3.8 percent on average compared with the previous year.
WORCESTER — With many business owners reeling from dramatic increases in their property assessments, some city councilors are signaling that the lowest residential tax rate allowed under tax classification is not in the cards this fiscal year.
They said that may have to be the case because the highest possible tax rate for commercial and industrial properties, combined with the skyrocketing assessments, would place a tremendous tax burden on many businesses.
“It doesn’t take a math whiz to figure out that with the lowest residential tax rate, commercial tax bills would go through the roof,” said Councilor-at-Large Frederick C. Rushton.
“We have to figure out what we’re going to do with this situation,” he added. “The way I’m reading the tea leaves, if we vote the lowest residential tax rate it would send a true shock to the business community. We have to be cognizant of the cause and effect of the tax rates we eventually set because the bottom line is what the final bill ends up being.”
Since the early 1980s, the city has set separate tax rates for residential and commercial-industrial properties, as is allowed under tax classification.
The City Council has adopted the lowest residential tax rate in several of those years, and in all years the residential tax rate has been significantly lower than the commercial-industrial rate.
Adoption of the lowest residential tax rate translates into the highest possible tax rate for commercial and industrial properties.
Pending final certification of the city’s triennial property revaluation, the City Council hopes to finally be able to set the tax rates for this fiscal year on May 22.
Councilor-at-Large Konstantina B. Lukes, who has traditionally voted for the lowest residential tax rate, said setting the rates for this fiscal year will be one of the most difficult decisions the council will have to make.
While acknowledging that adoption of the lowest residential tax rate could cripple many businesses, she said she does not want to see homeowners have to bear the burden through higher taxes as a way to correct past assessing practices.
Mrs. Lukes has suggested that homeowners be asked to pay no more of an increase in their property taxes than what they paid the previous year.
“We’re all going to get blamed for this,” Mrs. Lukes said. “We find ourselves having to correct the culmination of a series (of assessing) missteps.”
District 5 Councilor William J. Eddy, meanwhile, said setting the tax rates should not come down to pitting homeowners against business owners, as seems to happen every year.
“We’re one community,” Mr. Eddy said. “We have to make a decision on the tax rate that ensures our residents have a livable city.”
District 1 Councilor Tony Economou said he fears a higher tax rate for business properties could unravel all the progress that has been made in the city the past several years.
“We have to look at all options going forward,” he said. “These kinds of tax increases simply cannot be absorbed by many businesses.”
But District 2 Councilor Philip P. Palmieri, who has already indicated that he is leaning toward once again supporting the lowest residential tax rate, said it is an issue of fairness.
He said homeowners should not be asked to pick up a greater share of the tax burden to compensate for many business properties being under-assessed for so long.
“This is a problem no one had anticipated, certainly not of this magnitude,” Mr. Palmieri said. “I’ve always committed to the lowest residential tax rate and will probably remain that way. Residents shouldn’t have to carry the full burden.”
District 3 Councilor George J. Russell, who has questioned the method used to assess commercial and industrial properties, said he has always advocated for tax rates that favor the homeowner.
“My fear is that the council is going to shift the tax rate to the homeowner to somehow make up for an assessment process that does not reflect accurate values,” Mr. Russell said.
Of the city’s 2,278 commercial parcels, the assessed valuations for 317 have gone up 10 percent to 20 percent; 498 went up 20 percent to 40 percent; and 540 went up 40 percent to 100 percent, according to city officials.
Meanwhile, the valuations of 174 commercial properties have increased by more than 100 percent.
Of the 598 industrial properties in the city, the assessed valuations of 58 of those properties have increased by 10 percent to 20 percent; 98 properties went up by 20 percent to 40 percent and 101 properties shot up 40 percent to 100 percent.
In addition the assessed valuations of 60 industrial properties have more than doubled.
Meanwhile, residential property assessments have decreased by 3.8 percent on average compared with the previous year.
T&G: Worcester faces tough choices in setting tax rate this year
By Nick Kotsopoulos TELEGRAM & GAZETTE STAFF
WORCESTER — With many business property owners swooning from dramatic increases in their property assessments, some city councilors are signaling that the lowest residential tax rate allowed under tax classification is not in the cards this fiscal year.
They said that may have to be the case because the highest possible tax rate for commercial and industrial properties, combined with the skyrocketing assessments, would place a tremendous tax burden on many businesses.
"It doesn't take a math whiz to figure out that with the lowest residential tax rate, commercial tax bills would go through the roof," said Councilor-at-Large Frederick C. Rushton.
"We have to figure out what we're going to do with this situation," he added. "The way I'm reading the tea leaves, if we vote the lowest residential tax rate it would send a true shock to the business community. We have to be cognizant of the cause and effect of the tax rates we eventually set because the bottom line is what the final bill ends up being."
Since the early 1980s, the city has set separate tax rates for residential and commercial-industrial properties, as is allowed under tax classification.
The City Council has adopted the lowest residential tax rate in several of those years and in all years the residential tax rate has been significantly lower than the commerical-industrial rate.
Adoption of the lowest residential tax rate translates into the highest possible tax rate for commercial and industrial properties.
Pending final certification of the city's triennial property revaluation, the City Council hopes to finally be able to set the tax rates for this fiscal year on May 22.
Councilor-at-Large Konstantina B. Lukes, who has traditionally voted for the lowest residential tax rate, said the tax rates set by the council for this fiscal year will be one of the most difficult decisions it will have to make.
While acknowledging that adoption of the lowest residential tax rate could cripple many businesses, she said she does not want to see homeowners have to bear the burden through higher taxes as a way to correct past assessing practices.
Mrs. Lukes has suggested that homeowners be asked to pay no more of an increase in their property taxes than what they paid the previous year.
"We're all going to get blamed for this," Mrs. Lukes said. "We find ourselves having to correct the culmination of a series (assessing) missteps."
District 5 Councilor William J. Eddy, meanwhile, said the setting of the tax rates should not come down to pitting homeowners versus business owners, as seems to happen every year.
"We're one community," Mr. Eddy said. "We have to make a decision on the tax rate that ensures our residents have a livable city."
District 1 Councilor Tony Economou said he fears a higher tax rate for business properties could "unravel" all the progress that has been made in the city the past several years.
"We have to look at all options going forward," he said. "These kind of tax increases simply cannot be absorbed by many businesses."
But District 2 Councilor Philip P. Palmieri, who has already indicated that he is leaning toward once again supporting the lowest residential tax rate, said it is an issue of fairness.
He said homeowners should not be asked to pick up a greater share of the tax burden to compensate for many business properties being under-assessed for so long.
"This is a problem no one had anticipated; certainly not of this magnitude," Mr. Palmieri said. "I've always committed to the lowest residential tax rate and will probably remain that way. Residents shouldn't have to carry the full burden."
District 3 Councilor George J. Russell, who has questioned the method that was used to assess commercial and industrial properties, said he has always advocated for tax rates that favor the homeowner.
"My fear is that the council is going to shift the tax rate to the homeowner to some how make-up for an assessment process that does not reflect accurate values," Mr. Russell said.
Of the city's 2,278 commercial parcels, the assessed valuations for 317 have gone up 10 percent to 20 percent; 498 went up 20 percent to 40 percent; and 540 went up 40 percent to 100 percent, according to city officials.
Meanwhile, the valuations of 174 commercial properties have increased by more than 100 percent.
Of the 598 industrial properties in the city, the assessed valuations of 58 of those properties have increased by 10 percent to 20 percent; 98 properties went up by 20 percent to 40 percent and 101 properties shot up 40 percent to 100 percent.
In addition the assessed valuations of 60 industrial properties have more than doubled.
Meanwhile, residential property assessments have decreased by 3.8 percent on average compared with the previous year.
WORCESTER — With many business property owners swooning from dramatic increases in their property assessments, some city councilors are signaling that the lowest residential tax rate allowed under tax classification is not in the cards this fiscal year.
They said that may have to be the case because the highest possible tax rate for commercial and industrial properties, combined with the skyrocketing assessments, would place a tremendous tax burden on many businesses.
"It doesn't take a math whiz to figure out that with the lowest residential tax rate, commercial tax bills would go through the roof," said Councilor-at-Large Frederick C. Rushton.
"We have to figure out what we're going to do with this situation," he added. "The way I'm reading the tea leaves, if we vote the lowest residential tax rate it would send a true shock to the business community. We have to be cognizant of the cause and effect of the tax rates we eventually set because the bottom line is what the final bill ends up being."
Since the early 1980s, the city has set separate tax rates for residential and commercial-industrial properties, as is allowed under tax classification.
The City Council has adopted the lowest residential tax rate in several of those years and in all years the residential tax rate has been significantly lower than the commerical-industrial rate.
Adoption of the lowest residential tax rate translates into the highest possible tax rate for commercial and industrial properties.
Pending final certification of the city's triennial property revaluation, the City Council hopes to finally be able to set the tax rates for this fiscal year on May 22.
Councilor-at-Large Konstantina B. Lukes, who has traditionally voted for the lowest residential tax rate, said the tax rates set by the council for this fiscal year will be one of the most difficult decisions it will have to make.
While acknowledging that adoption of the lowest residential tax rate could cripple many businesses, she said she does not want to see homeowners have to bear the burden through higher taxes as a way to correct past assessing practices.
Mrs. Lukes has suggested that homeowners be asked to pay no more of an increase in their property taxes than what they paid the previous year.
"We're all going to get blamed for this," Mrs. Lukes said. "We find ourselves having to correct the culmination of a series (assessing) missteps."
District 5 Councilor William J. Eddy, meanwhile, said the setting of the tax rates should not come down to pitting homeowners versus business owners, as seems to happen every year.
"We're one community," Mr. Eddy said. "We have to make a decision on the tax rate that ensures our residents have a livable city."
District 1 Councilor Tony Economou said he fears a higher tax rate for business properties could "unravel" all the progress that has been made in the city the past several years.
"We have to look at all options going forward," he said. "These kind of tax increases simply cannot be absorbed by many businesses."
But District 2 Councilor Philip P. Palmieri, who has already indicated that he is leaning toward once again supporting the lowest residential tax rate, said it is an issue of fairness.
He said homeowners should not be asked to pick up a greater share of the tax burden to compensate for many business properties being under-assessed for so long.
"This is a problem no one had anticipated; certainly not of this magnitude," Mr. Palmieri said. "I've always committed to the lowest residential tax rate and will probably remain that way. Residents shouldn't have to carry the full burden."
District 3 Councilor George J. Russell, who has questioned the method that was used to assess commercial and industrial properties, said he has always advocated for tax rates that favor the homeowner.
"My fear is that the council is going to shift the tax rate to the homeowner to some how make-up for an assessment process that does not reflect accurate values," Mr. Russell said.
Of the city's 2,278 commercial parcels, the assessed valuations for 317 have gone up 10 percent to 20 percent; 498 went up 20 percent to 40 percent; and 540 went up 40 percent to 100 percent, according to city officials.
Meanwhile, the valuations of 174 commercial properties have increased by more than 100 percent.
Of the 598 industrial properties in the city, the assessed valuations of 58 of those properties have increased by 10 percent to 20 percent; 98 properties went up by 20 percent to 40 percent and 101 properties shot up 40 percent to 100 percent.
In addition the assessed valuations of 60 industrial properties have more than doubled.
Meanwhile, residential property assessments have decreased by 3.8 percent on average compared with the previous year.
T&G: Worcester earns A's in fiscal ratings
By Nick Kotsopoulos TELEGRAM & GAZETTE STAFF
WORCESTER — The city's fiscal health remains strong as two bond rating agencies have affirmed their previous ratings for it, citing “significant improvement” in its reserve and liquidity positions, as well as prudent management of unused property tax-levy capacity and steady progress toward funding long-term liabilities.
Moody's Investors Service has assigned an “A1” rating to the city's upcoming bond sale — $6.8 million general obligation District Improvement Financing Bonds.
It also affirmed the “A1” rating and “positive outlook” for the city's $573 million worth of outstanding general obligation limited tax debt.
Concurrently, Standard & Poor's assigned its “A-” long-term rating to the city's bond issuance and affirmed its “A-” rating and positive outlook for previously issued debt.
The general obligation District Improvement Financing Bonds are scheduled to be put out for sale on May 22.
At the same time, the city plans to sell $21.9 million in short-term Bond Anticipation Notes.
City Manager Michael V. O'Brien said the ratings are an indicator of the city's long-term “stability, vibrancy and vitality.”
“I am pleased by this news and appreciative of the collective work that has been done by all to help stabilize our municipal finances,” Mr. O'Brien said.
In its analysis, Moody's said its long-term “A1” rating reflects the city's satisfactory overall credit profile, which includes improved financial reserves, moderate tax-levy capacity under Proposition 2-1/2 and medium-term expansion in the city's economic base.
Moody's added that its positive outlook for Worcester recognizes continued improvement in financial operations, resulting in increased reserves, expected medium-term tax-based growth and a prudently-managed debt position.
“Worcester's positive outlook reflects the city's improved financial position and reduced enterprise risk due to a conservative approach to budgeting and expenditure management,” the Moody's report said. “The city's management and elected officials have adhered to its adopted Five-Point Plan, a set of comprehensive financial policies adopted in 2006 to improve financial reporting and forecasting for the city's operating and capital budgets, generate growth in reserves and provide limits for annual general fund borrowing.
“The positive outlook anticipates improvement in Worcester's financial position in the near term, including continued augmentation of general fund and stabilization fund reserves, steady progress toward funding (long-term liabilities) and a prudent approach to capital planning and debt management,” the report added.
Standard & Poor's, meanwhile, said good financial management practices have enabled the city to maintain financial stability through the recession, while many other communities' bond ratings have declined.
“Worcester's financial position has improved substantially over the past three fiscal years,” the Standard & Poor's report said. “The positive outlook reflects our assessment of the city's ongoing progress toward improving financial budget management practices and reserves, while at the same time implementing cost control and reform measures associated with its long-term liabilities.
“In our view, the city has proactively adjusted to lower state revenues and local receipts through the recession,” it added. “Moreover, economic development has been steady.”
Both ratings agencies did express concerns, however, about the city's ability to address a large unfunded liability for post-employment health benefits. According to most recent actuarial projects, that unfunded liability is at about $765 million, which is actually down significantly from an initial 2008 valuation of $1.2 billion.
WORCESTER — The city's fiscal health remains strong as two bond rating agencies have affirmed their previous ratings for it, citing “significant improvement” in its reserve and liquidity positions, as well as prudent management of unused property tax-levy capacity and steady progress toward funding long-term liabilities.
Moody's Investors Service has assigned an “A1” rating to the city's upcoming bond sale — $6.8 million general obligation District Improvement Financing Bonds.
It also affirmed the “A1” rating and “positive outlook” for the city's $573 million worth of outstanding general obligation limited tax debt.
Concurrently, Standard & Poor's assigned its “A-” long-term rating to the city's bond issuance and affirmed its “A-” rating and positive outlook for previously issued debt.
The general obligation District Improvement Financing Bonds are scheduled to be put out for sale on May 22.
At the same time, the city plans to sell $21.9 million in short-term Bond Anticipation Notes.
City Manager Michael V. O'Brien said the ratings are an indicator of the city's long-term “stability, vibrancy and vitality.”
“I am pleased by this news and appreciative of the collective work that has been done by all to help stabilize our municipal finances,” Mr. O'Brien said.
In its analysis, Moody's said its long-term “A1” rating reflects the city's satisfactory overall credit profile, which includes improved financial reserves, moderate tax-levy capacity under Proposition 2-1/2 and medium-term expansion in the city's economic base.
Moody's added that its positive outlook for Worcester recognizes continued improvement in financial operations, resulting in increased reserves, expected medium-term tax-based growth and a prudently-managed debt position.
“Worcester's positive outlook reflects the city's improved financial position and reduced enterprise risk due to a conservative approach to budgeting and expenditure management,” the Moody's report said. “The city's management and elected officials have adhered to its adopted Five-Point Plan, a set of comprehensive financial policies adopted in 2006 to improve financial reporting and forecasting for the city's operating and capital budgets, generate growth in reserves and provide limits for annual general fund borrowing.
“The positive outlook anticipates improvement in Worcester's financial position in the near term, including continued augmentation of general fund and stabilization fund reserves, steady progress toward funding (long-term liabilities) and a prudent approach to capital planning and debt management,” the report added.
Standard & Poor's, meanwhile, said good financial management practices have enabled the city to maintain financial stability through the recession, while many other communities' bond ratings have declined.
“Worcester's financial position has improved substantially over the past three fiscal years,” the Standard & Poor's report said. “The positive outlook reflects our assessment of the city's ongoing progress toward improving financial budget management practices and reserves, while at the same time implementing cost control and reform measures associated with its long-term liabilities.
“In our view, the city has proactively adjusted to lower state revenues and local receipts through the recession,” it added. “Moreover, economic development has been steady.”
Both ratings agencies did express concerns, however, about the city's ability to address a large unfunded liability for post-employment health benefits. According to most recent actuarial projects, that unfunded liability is at about $765 million, which is actually down significantly from an initial 2008 valuation of $1.2 billion.
Sunday, May 13, 2012
Golocalworcester: Chamber Head: Worcester Valuations to Close Businesses
Walter Bird Jr., GoLocalWorcester Reporter
Worcester businesses will go under if the city levies the highest possible tax rate on commercial and industrial properties, Dick Kennedy said.
That uncertainty, said Kennedy, president/CEO of the Worcester Regional Chamber of Commerce, combined with recent skyrocketing assessment, has city officials and property owners holding their breath until fourth quarter tax bills are delivered.
Kennedy said business owners are worried that property valuations, which in some cases have doubled and tripled, will contribute to a sharp increase in their taxes when the city finally mails out the final fiscal 2012 tax bills. Those will be followed in short order by the first quarter bills for fiscal 2013.
“Yes,” he answered flatly when asked whether some owners would go out of business if their tax bills increase sharply. “Let me put it this way. Very successful businesses are calling me, saying I don’t know if I would move or stay in business.”
Businesses are ‘backbone’
That is not a message Mayor Joseph Petty wants to send to a valuable and much-needed part of the city’s tax base.
“I certainly do not want one business to close in Worcester and certainly not because of our tax structure,” Petty said in a statement to GoLocalWorcester. “I am very concerned as to what the impact of the new assessments will have on the business community. Small business are the backbone of our economy and I will take a very detailed look once we receive the numbers as to what the impact will be for both the residential and the commercial owners.”
What will they pay?
Residential taxpayers, city councilors and officials all share the same concerns: With a tax classification hearing set for May 22, and tax rates (the city has a two-tiered tax system) ready to finally be set, how bad, exactly, will the news be for taxpayers? And is there anything the city can do to avoid putting the hurt on them? The answers aren’t pretty. The current residential tax rate is $16.06 per $1,000 assessed valuation. The commercial, industrial and personal property tax rate is $34.65 per $1,000.
“There are very few options, no one of them good,” At-Large City Councilor and former Mayor Konstantina Lukes said. “Should the council rectify past inequities and give residential taxpayers less of a burden to make up for what they had been picking up? On the other side, these are bad economic times. We’re trying to pass the burden around and we can’t, because we’ll lose business.”
While there is much speculation over just what the tax rates will be, Petty wasn’t about to join the rumor mill or raise any fears.
“I cannot comment on what the implications will be to the taxpayers until we see the numbers,” Petty said. “We currently have not been provided with that information.”
File an appeal
Still, the news does not appear good for residential taxpayers. Of course, there are options. Taxpayers have two routes when it comes to disagreeing with their tax assessments. They can request tax abatements or they can take the city to court. The first step is to file an appeal and the city has plenty of those on its plate. For fiscal 2011, there were a total of 95 residential and commercial appeals filed, according to Christina Andreoli, spokesperson for City Manager Michael O’Brien.
Based on early signs – some property valuations have increased, percentage-wise, in triple digits – a high number of appeals is likely for fiscal 2012. Big businesses are likely to feel the pinch, too. The valuation for the Saint-Gobain Abrasives property at 1 New Bond Street, where there are three factories, jumped by 484.6 percent over fiscal 2011 – from $3.3 million to $19.7 million. The valuation for property owned by Berkeley Management at 90 Front St. increased even more – from $2.19 million to $13.79 million, or 527.2 percent.
Calls to representatives for both companies were not immediately returned.
Controversial overrides
Adding to the furor over potentially crippling tax bills is a debate over the system the city once used for property valuations. Officials claim assessors previously performed several manual overrides – a practice the Massachusetts Department of Revenue (DOR) acknowledged is standard and widely used. Andreoli said a review of the assessing department, which O’Brien mandated when the new assessor, William Ford, arrived in 2009, revealed more than 2,000 manual overrides. That helped keep tax levels low, many now believe artificially, and when they were removed property assessments shot up.
Manual overrides are used, according to DOR spokesperson Bob Bliss, to account for any number of factors in a valuation, such as a change of building use or for a property that had become vacant.
“(Ford) found that more than 2,000 properties had manual overrides on them and in some cases properties had not been inspected in years – there was no back-up, documentation, or notes in the file to say when these changes or adjustments occurred,” Andreoli told GoLocalWorcester. “They could have been there for one reason at one time or another, but as they stand today, there is no place in law or DOR regulations for these overrides to exist. The city must develop fair and equitable values for all classes of property. These values must be based on the most current and accurate property data."
Andreoli said, “As part of this required triennial revaluation, property data was checked, double-checked and tripled-checked through virtual reviews, full-field reviews, and valuation reviews. These reviews were necessary to ensure fair and accurate valuations of individual properties.”
The discovery of manual overrides and the resulting increase in commercial and industrial property assessments has led to finger-pointing and blame, and when the question was posed to Lukes, she said, “That’s an interesting question.”
Former assessor Bob Allard’s name has popped up as officials and residents wonder just why so many overrides were done, something he has publicly refuted. Petty shot down any suggestions of wrongdoing by Allard.
“I do not believe there was tampering,” Petty said. “Bob Allard worked for this city for long time and was always held in the highest regards. I am not aware any issues or concerns as to how he acted as the city’s assessor or how the assessing department was run.
An outdated system
The real culprit could be an antiquated process that, as late as 2007 was operating on DOS, or disk operating system. Printers spit out large reams of green-barred paper with perforated edges.
“Now,” said Bliss, “The city has a new, state-of-the art system.”
Actions, which were previously done manually, are included in the new system, although Bliss said manual overrides can still be done.
Income approach
The new way of doing things has also ignited anger among some observers, including City Councilor George Russell, a licensed realtor whose business also includes a real estate school. The city now assesses commercial and industrial property using an income method, meaning it looks at what a property could generate in revenue. Russell believes the state has forced the city to use this method of valuating property.
“The administration tells me that’s what Boston is making us do,” he said, a charge Bliss vehemently denied.
“No,” Bliss said. “We did not encourage the city to use the income approach. That’s what they used to use.”
There are three approaches to assessing property, he said. One of them, the comparable sales method, is predominantly used to assess residential property, because it is easier to find other properties of comparable worth. That is not the case with commercial and residential property. Russell acknowledged that point, but believes it is unfair when it is the only method used to assess those properties.
“It works when you have income,” he said. “But if you have a vacant property … you can’t say, gee, in a perfect world it would rent for whatever.”
Russell made it clear he is an advocate for the lowest possible residential property rate for homeowners, “or slightly lower, but not more than, last year.”
Confidence high, low
Russell answered directly when asked whether he had confidence in the city’s handling of the fiscal 2012 property assessments.
“I’m confident in the city manager and the administration overall, but not happy with the way the whole valuation process has come out,” he said.
When asked about the current assessor, Russell said, “I don’t have confidence in the way he’s gone about this process. Personally, I think he’s honorable. I just think the process he’s chosen is not accurate.”
Worcester businesses will go under if the city levies the highest possible tax rate on commercial and industrial properties, Dick Kennedy said.
That uncertainty, said Kennedy, president/CEO of the Worcester Regional Chamber of Commerce, combined with recent skyrocketing assessment, has city officials and property owners holding their breath until fourth quarter tax bills are delivered.
Kennedy said business owners are worried that property valuations, which in some cases have doubled and tripled, will contribute to a sharp increase in their taxes when the city finally mails out the final fiscal 2012 tax bills. Those will be followed in short order by the first quarter bills for fiscal 2013.
“Yes,” he answered flatly when asked whether some owners would go out of business if their tax bills increase sharply. “Let me put it this way. Very successful businesses are calling me, saying I don’t know if I would move or stay in business.”
Businesses are ‘backbone’
That is not a message Mayor Joseph Petty wants to send to a valuable and much-needed part of the city’s tax base.
“I certainly do not want one business to close in Worcester and certainly not because of our tax structure,” Petty said in a statement to GoLocalWorcester. “I am very concerned as to what the impact of the new assessments will have on the business community. Small business are the backbone of our economy and I will take a very detailed look once we receive the numbers as to what the impact will be for both the residential and the commercial owners.”
What will they pay?
Residential taxpayers, city councilors and officials all share the same concerns: With a tax classification hearing set for May 22, and tax rates (the city has a two-tiered tax system) ready to finally be set, how bad, exactly, will the news be for taxpayers? And is there anything the city can do to avoid putting the hurt on them? The answers aren’t pretty. The current residential tax rate is $16.06 per $1,000 assessed valuation. The commercial, industrial and personal property tax rate is $34.65 per $1,000.
“There are very few options, no one of them good,” At-Large City Councilor and former Mayor Konstantina Lukes said. “Should the council rectify past inequities and give residential taxpayers less of a burden to make up for what they had been picking up? On the other side, these are bad economic times. We’re trying to pass the burden around and we can’t, because we’ll lose business.”
While there is much speculation over just what the tax rates will be, Petty wasn’t about to join the rumor mill or raise any fears.
“I cannot comment on what the implications will be to the taxpayers until we see the numbers,” Petty said. “We currently have not been provided with that information.”
File an appeal
Still, the news does not appear good for residential taxpayers. Of course, there are options. Taxpayers have two routes when it comes to disagreeing with their tax assessments. They can request tax abatements or they can take the city to court. The first step is to file an appeal and the city has plenty of those on its plate. For fiscal 2011, there were a total of 95 residential and commercial appeals filed, according to Christina Andreoli, spokesperson for City Manager Michael O’Brien.
Based on early signs – some property valuations have increased, percentage-wise, in triple digits – a high number of appeals is likely for fiscal 2012. Big businesses are likely to feel the pinch, too. The valuation for the Saint-Gobain Abrasives property at 1 New Bond Street, where there are three factories, jumped by 484.6 percent over fiscal 2011 – from $3.3 million to $19.7 million. The valuation for property owned by Berkeley Management at 90 Front St. increased even more – from $2.19 million to $13.79 million, or 527.2 percent.
Calls to representatives for both companies were not immediately returned.
Controversial overrides
Adding to the furor over potentially crippling tax bills is a debate over the system the city once used for property valuations. Officials claim assessors previously performed several manual overrides – a practice the Massachusetts Department of Revenue (DOR) acknowledged is standard and widely used. Andreoli said a review of the assessing department, which O’Brien mandated when the new assessor, William Ford, arrived in 2009, revealed more than 2,000 manual overrides. That helped keep tax levels low, many now believe artificially, and when they were removed property assessments shot up.
Manual overrides are used, according to DOR spokesperson Bob Bliss, to account for any number of factors in a valuation, such as a change of building use or for a property that had become vacant.
“(Ford) found that more than 2,000 properties had manual overrides on them and in some cases properties had not been inspected in years – there was no back-up, documentation, or notes in the file to say when these changes or adjustments occurred,” Andreoli told GoLocalWorcester. “They could have been there for one reason at one time or another, but as they stand today, there is no place in law or DOR regulations for these overrides to exist. The city must develop fair and equitable values for all classes of property. These values must be based on the most current and accurate property data."
Andreoli said, “As part of this required triennial revaluation, property data was checked, double-checked and tripled-checked through virtual reviews, full-field reviews, and valuation reviews. These reviews were necessary to ensure fair and accurate valuations of individual properties.”
The discovery of manual overrides and the resulting increase in commercial and industrial property assessments has led to finger-pointing and blame, and when the question was posed to Lukes, she said, “That’s an interesting question.”
Former assessor Bob Allard’s name has popped up as officials and residents wonder just why so many overrides were done, something he has publicly refuted. Petty shot down any suggestions of wrongdoing by Allard.
“I do not believe there was tampering,” Petty said. “Bob Allard worked for this city for long time and was always held in the highest regards. I am not aware any issues or concerns as to how he acted as the city’s assessor or how the assessing department was run.
An outdated system
The real culprit could be an antiquated process that, as late as 2007 was operating on DOS, or disk operating system. Printers spit out large reams of green-barred paper with perforated edges.
“Now,” said Bliss, “The city has a new, state-of-the art system.”
Actions, which were previously done manually, are included in the new system, although Bliss said manual overrides can still be done.
Income approach
The new way of doing things has also ignited anger among some observers, including City Councilor George Russell, a licensed realtor whose business also includes a real estate school. The city now assesses commercial and industrial property using an income method, meaning it looks at what a property could generate in revenue. Russell believes the state has forced the city to use this method of valuating property.
“The administration tells me that’s what Boston is making us do,” he said, a charge Bliss vehemently denied.
“No,” Bliss said. “We did not encourage the city to use the income approach. That’s what they used to use.”
There are three approaches to assessing property, he said. One of them, the comparable sales method, is predominantly used to assess residential property, because it is easier to find other properties of comparable worth. That is not the case with commercial and residential property. Russell acknowledged that point, but believes it is unfair when it is the only method used to assess those properties.
“It works when you have income,” he said. “But if you have a vacant property … you can’t say, gee, in a perfect world it would rent for whatever.”
Russell made it clear he is an advocate for the lowest possible residential property rate for homeowners, “or slightly lower, but not more than, last year.”
Confidence high, low
Russell answered directly when asked whether he had confidence in the city’s handling of the fiscal 2012 property assessments.
“I’m confident in the city manager and the administration overall, but not happy with the way the whole valuation process has come out,” he said.
When asked about the current assessor, Russell said, “I don’t have confidence in the way he’s gone about this process. Personally, I think he’s honorable. I just think the process he’s chosen is not accurate.”
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