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Property tax appeals rise during economic decline

MIAMI – Oct. 20, 2009 – Even after years of sinking real estate prices, thousands of South Florida property owners are fighting to further deflate the values of their homes and businesses.

Here is the original article

Appeals of property values used for tax assessments are rising in Palm Beach, Broward and Miami-Dade counties as owners try to cut tax bills during a dreary economy. Deadlines for appealing property taxes have passed, though there are some exceptions.

Appeals jumped a record 40 percent in Palm Beach County, where 18,325 taxpayers filed to challenge their 2009 assessments. In Broward County, the appeals increased 9 percent to 32,411.

Miami-Dade County, which usually leads the pack, has yet to finish counting how many appeals were filed by last month’s deadline.

About 69,000 petitions have been entered into Miami-Dade’s appeals system. At that pace, the appeals are expected to far exceed the 70,000 filed last year, Value Adjustment Board Manager Robert Alfaro said.

Many of those filing appeals in South Florida are frustrated that even though their property values dropped, rising tax rates leave their tax payments about the same or higher this year.

Sherman Lein said he decided to appeal the tax assessment for his home west of Boca Raton. The Palm Beach County property appraiser decreased his home value by about $100,000, but his tax bill was still higher than last year.

“It’s ridiculous,” said Lein, 79, who owes about $6,000 in property taxes. “This house is not worth what they are saying it is. … It is just a matter of what is fair and reasonable.”

The spike in appeals comes at a time when changes in state law make the process more taxpayer-friendly. In the past, property appraisers benefited from a “presumption of correctness” that put the burden on taxpayers to prove that an assessment was wrong. Now property appraisers have to go further to defend how they arrived at the number.

There is also more leeway this year for property owners to file late if they can prove that an illness or other extraordinary circumstance delayed their application.

“I had a flood of phone calls this year,” said real estate representative Sheila Anderson, who handles hundreds of appeals for property owners across Florida. “This is the year to appeal.”

Property owners who cannot work out their differences with county appraisers can file appeals with value adjustment boards. They get a hearing with an appointed magistrate – an independent appraiser or real estate attorney who hears arguments from the property owner and the appraiser’s office and then decides what the assessment should be. Taxpayers who lose can then appeal in circuit court.

Broward County Property Appraiser Lori Parrish said she supported the changes to the appeals process.

“Why shouldn’t we have to prove to them where we got our numbers?” Parrish asked. “The issue is, did we get the assessment right? … That’s what is important.”

It still takes proof of a mistake or misjudgment by the property appraiser to win an appeal, and just complaining about an increased tax bill won’t necessarily be enough.

Palm Beach County property values determined by the appraiser’s office went down about 13 percent because of the struggling real estate market, but the County Commission opted to increase property tax rates 15 percent to avoid losing tax revenue.

Also, even if tax rates for other government agencies remain the same as property values continue to drop, the state’s “recapture rule” can result in tax bills going up for homesteaded properties.

If the taxable value of a property is less than market value, the state requires property appraisers to increase the taxable value by 3 percent or the percent change in the Consumer Price Index, whichever is less.

John Thomas, director of residential appraisals for the Palm Beach County Property Appraiser’s Office, said his office has explained why taxes may go up despite falling property values to “literally thousands of people.” He said: “These people are screaming foul. … They are angry and they have a right to be angry.”

In addition to fighting the tax assessment on his home west of Boca Raton, Lein is also appealing the taxes on the half-vacant commercial building he manages near Lake Worth.

County appraisals, based on values as of Jan. 1, need to better reflect the current market, Lein said. Cities and counties should have done a better job managing the money that flooded their coffers during South Florida’s housing boom, he said.

“What did they do with all that money?” Lein asked.

Copyright © 2009 Sun Sentinel, Fort Lauderdale, Fla., Andy Reid. Distributed by McClatchy-Tribune Information Services.

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