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HomeMy WebLinkAbout1978 05-31 CCM Board of Equalization 3w MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA BOARD OF EQUALIZATION MAY 31, 1978 CITY HALL Call to Order The Brooklyn Center City Council met as the Board of Equal- ization and was called to order by Mayor Dean Nyquist at 7 :33 p.m. Roll Call Mayor Dean Nyquist, Councilmembers Tony Kuefler, Gene Lhotka and Celia Scott. Also present were City Manager Gerald Splinter, City Assessor Peter Koole and Administrative Assistant Ronald Warren. Mayor Nyquist reported that Councilmember Fignar had informed him previously that he was unable to attend this evening's Board of Equalization meeting due to another commitment and, therefore, was excused. Purpose of Board Mayor Nyquist referred to Chapter 274 of the Minnesota of Equalization Statutes and to Sections 7.03 and 7.04 of the City Charter which authorizes the City Council to sit as the Board of Equalization to review assessments of property for taxation purposes. He stated that the Board of Equalization is concerned with two things: first, that all taxable property has been listed, and second, that the assessments have been done in an equitable manner. He explained that the City Assessor does not determine what an individual's property tax will be, but rather determines the value of the property to be taxed. The Mayor reported that this meeting was a duly called public meeting with notice of the date, time and place being posted at the City Hall for at least 10 days preceding this meeting, and that notice was also published in the City's official newspaper. He added that cards containing both the market value and limited value for each piece of property were sent to all property owners and that these cards also gave notice of the date, time and place of the Board of Equalization meeting. Mayor Nyquist next reviewed the procedure to be followed at this evening's meeting: a review of the property taxation process by the City Manager; a report by the City Assessor and the opportunity for the Board of Equalization to question the Assessor regarding assessment methods; and a public hearing for the purpose of receiving public inquiry relative to property assessments. Procedural Review of The City Manager briefly reviewed the assessment procedure Property Taxation and commented that the Assessor is required to annually inform each property owner of any change in the valuation of their property. He explained that cards are sent out which contain a market value and a limited value for each piece of property. He further stated that the market value is determined through the analysis of current market trends and should generally reflect the amount a willing buyer would pay to a willing seller for a certain piece of property. He added that the lirnited value represents the amount of valuation that is used for tax purposes, and is confined to a 10% annual increase in the limited value or 25% of the difference between the old limited value and the new market value, whichever is greater, The _l - 5-31-78 City Manager further reported that the City Council had received two reports dealing with the purpose of the Board of Equalization and the City Council's role as a Board of Equalization. He stated that the reports also comment on the quality of assessment and the techniques used in establishing the assessed values in this community for the various classes of property, The City Manager reported that in the area of residential property the City realized an overall -increase of 11.6 %, with 1 .7% of that due to new construction and 9.9% due to market growth. He reported that the 9.9% market growth actually fell somewhat short of what happened in the market and, thus, the City's sale ratio will be about 1% lower than it was last year, but still well within an acceptable range. With respect to commercial and industrial properties, the City Manager stated that they increased about 11%. He- added that the area outside the Earle Brown Farm went up about 8.9% and the Earle Brown Farm. area went up about 27 %. The City Assessor reviewed State law as it pertains to City Assessor's Report the assessment of property. He stated that the purpose of the Board of Equalization is not to review the amount or levels of a person's property tax, but to review the assessed value of taxable property in the City as deter- mined by the Assessor. He explained that the City Council is required, by the City Charter, to sit as the Board of Equalization to review the work done by the City Assessor. He pointed out that Minnesota Statutes 274 � 01 state that the duty of the Board of Equalization is to examine and see that all taxable property in the City has been properly placed upon the tax list and duly valued by the Assessor. He continued that the Statute also states that on application of any person feeling aggrieved, the Board shall review the assessment and correct it as shall appear just. He explained that the local assessor, as mandated by State law, is responsible for establishing values of property while elected officials of cities, counties and school districts set the level of taxation. He stated that there is a formal process by which property owners can appeal the Assessor's determination of the value on a particular piece of property. He explained that the property owner's first appeal for alleged assess- ment inequity is to the local Board of Equal zation; the next step is to the County; `following that, the State Boards of Equalization; and finally the State tax court which is really the only body that can change the taxes He added that each claim of unfair assessment should be supported by evidence submitted to the hearing body, The City Assessor next reported on the quality of assess- ment in the City. He stated that the heart of the Assessor work is involved with sales ratio studies. He explained that this sales ratio is the per cent of the Assessor's value to the actual sales price. He stated that the average ratio in the City is 92 .8 and that the median ratio is 92.4. He explained that beginning in 1980 anything over a 10% coefficient of dispersion will result in a loss of State aids and that this must be watched carefully. He explained that the average sale price of a home in the City was $40,744 while the average Assessor's value was $37,807. He noted that the quality of assessment in the City is statistically goody -2- The City Assessor next reviewed the quality of assessment in more detail and commented on the 1978 sales study for 1977 sales. He explained that for homes selling over $55,000 the ratio of 92.3 was close to the average ratio for the City, which is 92.8. He explained that for homes selling for under $30,000 the ratio was 99.1 compared to the average ratio for the City of 92.8. The Assessor stated that this may well indicate that our value for these homes might be somewhat high, although adequate, but that further review in this area should be undertaken He pointed out that presently he does not contemplate obsoles- cence for homes near highways or freeways and that the sales study indicates that the ratio is within an acceptable range. He further commented on other portions of the sales study dealing with the agc of property and a neighborhood analysis. The City Assessor reported that the Assessor is required by law to visit each property once every four years. He reviewed a map and indicated the areas visited during the past year and the areas that will be visited in the upcoming year. He noted that during the past year the appraisers also visited all apartments and commercial and industrial properties. The City Assessor next commented on the Assessor's valua- tion and property taxes since 1970. He reviewed two properties chosen to be representative samples of homes in Brooklyn Center in two different price ranges. He pointed out that if both homeowners received a $150 incoine adjusted homestead credit, or circuit breaker, the 1978 net taxes in one case would be 12.91% lower than in 1970 and that in the other case the 1978 net taxes would be .07% higher than in 1970. The City Manager explained that basically what the Assessor is attempting to do is to make sure that properties are equally assessed among similar properties in the City. The City Assessor reported that he had received one notice objecting to a property assessment for this year. He read a letter from Mr. James H. Russell of Russell, Russell and McLeod, attorneys at law. He explained that they were objecting to the assessment for Howe, Inc. He further explained that they do not wish to appear at this evening's Board of Equalization meeting but wanted the record to indicate that they had abided by the procedure for the appeal process. Public Hearing Following further discussion Mayor Nyquist opened the meeting for purposes of public inquiry relating to the local assessments. He recognized Umberto Virgillo, 1112 - 67th Avenue North who complained that he felt the value placed on his property by the Assessor was too high. He stated that he pays approximately $1,103 in taxes and that he is aware of others with similar properties as his that pay only approximately $700 in taxes. He added that the Assessor's valuation is $2,200 more than what he paid for the property. The City Assessor commented on last year's assessment of Mr. Virgillo's home and stated that at that time the home was only 70% completed and was a nonhomestead. He pointed out that the property at that time was assessed at approximately $35,000 because it was not yet completely built by the first of the year. He explained that the valua- tion of the property was raised this year because the home -3- 5 -31 -78 was now complete and that the property owner home - steaded the property and was living in it. Regarding Mr. Virgillo's concern that the property is now valued approximately $2 -,200 more than what he originally paid for it, the City Assessor stated that this is not uncommon, for a new home. He pointed out that the property was duly inspected and that he feels it is adequately assessed. Mr. Virgillo stated that he has a water problem in the home that he feels adversely affects the value of his property. The City Assessor responded that he was not aware of this problem and that it was not pointed out at the time the property was inspected. He stated that he would be willing to review the property for any physical problems of this nature that might have an affect on the value of the property. The City Manager stated that the matter would be looked into further and that a report would be given to the City Council, Further discussion ensued with Mr. Virgillo regarding the assessed value of his property. In response to an inquiry by the City Council Mr. Virgillo expressed the opinion that he could sell the property for more than the value placed on it by the Assessor. Council- member Kuefler commented that he did not feel the assessed value was too high for the property, particularly in light of the fact that Mr. Virgillo feels he could sell it for more than the Assessor's value. Mayor Nyquist agreed with Councilmember Kuefler and added that he felt it was an equitable assessment. Following further discussion there was a motion by Council- Action to Affirm Assessor' member Kuefler and seconded by Councilmember Scott to Value affirm the Assessor's value on the property at 1112 - 67th Avenue North. Voting in favor: Mayor Nyquist, Council- members Kuefler, Lhotka, and Scott. Voting against: none. The motiori passed unanimously. Further discussion ensued with Mr. Virgillo regarding the assessment of his property in comparison with properties to other communities. Mayor Nyquist inquired if anyone else wished to address the Board of Equalization. No one else requested to be heard. Motion by Councilmember Kuefler and seconded by Adjournment Councilmember Lhotka to adjourn the meeting. Voting in favor: Mayor Nyquist, Councilmembers Kuefler, Lhotka, and Scott. Voting against: none. The motion passed unanimously. The Board of Equalization adjourned at 8:37 p.m, Clerk m 5 -31 -78 -4-