An obvious solution to the assessment controversy in Augusta
I reached out my hand to Arlie Wolfe. “How does it feel to be a millionaire?” I asked the Middlebrook man, who, for the record, isn’t really a millionaire, no matter what the piece of paper his wife, Joan, had in her purse had to say about the matter.
Arlie and Joan had bought their 400-acre farm property that backs into a mountain in the middle of Augusta County 10 years ago for $167,000. It was reassessed four years ago for $585,000. The piece of paper in Joan’s purse has it at over $1.6 million.
“Arlie’s probably going to have to go back out and get a job,” said Joan, who has been married to Arlie for going on 43 years now, detailing how he had to get out of the funeral business because of a severe back injury, and how hard it might be on Arlie to have to go back to work considering, but with the farm struggling to break even in today’s tough economy, something is going to have to give.
“I just don’t know how we make it otherwise,” Arlie said.
Residents across Augusta County are feeling the pinch, particularly, as it turns out, in the more rural parts of the county. Countywide, the quadrennial reassessment has the average property value up in the area of 28 percent, but the pain is being borne more by those with five or ten or a hundred of a few hundred acres in, say, Middlebrook or Greenville or Deerfield than those with a nice house and a quarter- or half-acre in Fishersville or Stuarts Draft.
“What I’m getting back from people and from looking at mine and looking at everybody else’s who is talking to me and going on VaMaNet is that the houses for the most part are holding steady or going up a little bit, unless you’ve built a brand-new house, and in some cases they’ve gone down. But the land is what in many places is going up – in some places 100 percent or more,” said Nancy Sorrells, a member of the Augusta County Board of Supervisors and Greenville resident who is feeling a bit of the sting of reassessment increases herself being out in a rural part of the county.
Sorrells is standing by the reassessments, which were conducted by the Staunton-based Blue Ridge Mass Appraisal on a $570,000 contract that is coming under fire from residents who are openly questioning the methodology used by the company and its record in other reassessments in other parts of the state.
The best-known case to that end is the reassessments done in Gloucester County in 2005 that were botched so badly that the board of supervisors in the county debated paying Blue Ridge under the terms of their contract before voting 4-3 to go ahead and do so. Another reassessment done by Blue Ridge, in nearby Bath County in 2008, was thrown out by the county board of supervisors there after assessments rose for some local landowners on the order of 1,000 percent.
A call to Blue Ridge Mass Appraisal president David Hickey this week seeking comment for this story was not returned. Sorrells stepped in to defend the company for its work, saying the reassessments, conducted under the purview of the Augusta County Board of Assessors, which offered regular reports to the board of supervisors on the work during the 18-month property-value review process, were “based on fair-market sales, and there’s no question sales have slowed down, but they haven’t stopped. They’re continuing,” Sorrells said. “We’ve got a list of printouts on sales that took place all the way to the last day of the year. And when they’re selling, for the most part they’re selling a good bit above the assessed value. What’s happening is a lot of people equate what they see in the paper every day with tough economic times, and there’s doubt it is, and the job losses and foreclosures that they’re reading about. They’re equating it all with the idea that their properties are going to be worth less, and they’re surprised when they don’t necessarily see that it’s worth less,” Sorrells said.
Another county board of supervisors member, Tracy Pyles, has a different idea as to what is going on. “One of the definitions in the law of fair-market value is what is a willing buyer willing to pay, and what is a willing seller willing to sell it for? We can’t match those things up because we’ve got a whole lot more sellers than we do buyers, and the number of buyers, and what they can afford to pay, keeps going down. To use any number in assessing our values as of Jan. 1, 2009, as being appropriate, using numbers from anything more than three months ago, is inappropriate,” said Pyles, who has been outspoken in his criticism of Blue Ridge Mass Appraisal and fellow board members for the conduct of the reassessments.
Pyles has also been fighting a losing battle with fellow board members dating back to last year that at times seems more personality- than policy-driven, which has made him an easy target for ridicule by other board members that Pyles himself makes jocular reference to from time to time. “I made a motion on that. I lost six-to-one. It was close,” he said at a public meeting on the reassessment issue Tuesday night that drew more than 600 people to the Verona United Methodist Church to strategize political and legal challenges to the reassessments.
But board members on the other side of that six-to-one division concede that Pyles, outarmed as he is, is winning the PR battle on the assessment issue, both with the heavy turnouts at public meetings and in the local news media, with both of the local newspapers, The News Leader in Staunton and The News Virginian in Waynesboro, editorializing that the reassessments seem out of whack and that the board will have to take action to correct the record at the risk of harming hundreds if not thousands of county property owners.
The sideshow aspect to this story comes in the form of Churchville attorney and farmer Francis Chester, who was the other main-eventer at the Tuesday public meeting in Verona. Full of bluster, Chester intoned into the microphone afforded him that he would just as well sue the county to block the reassessment, though he stopped far short of offering specifics as to how he would get that done. His motivation, admittedly, is personal, coming in the form of his shock and anger upon opening his own assessment notice. “I said to myself, What are you going to do about it? The average input was, There’s nothing we can do. And then I said, Well, wait a minute. There’s always something we can do,” Chester said. “You know, we employ them. We pay their salaries,” he said, gesturing to applause. “So where do they come along and do what they want to do when we as their employer want them to do something else? Can you imagine going to your employer and saying, Boss, I don’t like what you’re doing, I’m going to do it this way?
“All of you individually have a right to bring a suit to the circuit court of Augusta County. You’d be laughed out of court,” Chester went on, trying to make the point that there could be strength in numbers in fighting the reassessments in court en masse, though I think unintentionally making another one instead.
Chester was perhaps purposefully vague on what legal grounds would serve as the basis of the suit, which I offer editorially because he hinted at his strategy in his repeated references to challenging the reassessments as being “illegal and immoral” and otherwise citing as a buttress to his case language from the Virginia Constitution about the rights of government and rights of the people that have little if anything to do with the ins and outs of the assessment process.
The distraction that is the Chester lawsuit notwithstanding, there is a political case to be made that the county could simply throw the reassessments out and take the lumps that could come under state law. “What they’re saying is, The law says we must. It does. It also says, If you don’t, here’s your penalty. That’s the truth. That’s the law,” Pyles pointed out, and a reading of the Virginia State Code, in Section 58.1-3259, makes clear that localities failing to comply with the requirement that they conduct a general reassessment as prescribed under the law are to be docked their share of the net profits of the operation of the alcoholic beverage control system until such time as they come into compliance.
The penalty therein incurred is in the area of $40,000 a year for the county.
“We can be creative to make it so we don’t have to go forward. I say, Let’s be straight up about it. Let’s send it to the Secretary of the Treasury that we haven’t done it, and if you want to go ahead and take our money now, then go right ahead. But that’s all they can do to us,” Pyles said.
Let’s take another look at this. The lens we’ve used thus far has us assuming that property increases in the range of 50 percent and 100 percent and 200 percent and 300 percent and more are out of whack just because, well, it does seem to defy common sense, doesn’t it, that property values would go up that much in any four-year period, and particularly in one that has been as volatile economy-wise as the one we’re in now?
Another view is that the values reflected in the new assessments are right on in terms of fair-market value. “We’ve basically said through our actions as a board of supervisors that the highest and best use for every piece of land in Augusta County is a house lot, and that’s coming home to roost,” said Sorrells, herself a long-time advocate for the county agriculture sector who bemoans the squeeze that is being put on county farmers with sharply rising land values.
“The commodity that the farmer has to have is land – for his livestock, for his crops. If land is unaffordable, then he can’t farm. Farmers are getting squeezed,” Sorrells said, then pinned a good bit of the blame on the board of supervisors for its lack of follow-through in protecting the vitality of the county ag industry. “Even though we have a comp plan that says we only want 10 percent of our land in agricultural areas to be slated for development, because we want those areas to be available for farming, which is our top industry, we don’t have rules that prevent more development from taking place. And in fact we do a lot in the code to encourage development in agricultural areas. We basically say that by law every piece of land in the county is open for development,” Sorrells said.
That, in turn, pushes land values upward, because land that can be slated for quick development for residential or commercial purposes is going to be assigned a higher value than agricultural land. And it’s not like even some of those who are challenging their reassessments don’t see the potential long-range benefits of that spike in value.
“Some people want their land to be inflated because they want to cash in on it,” Sorrells said.
I next asked what to me seemed a logical question. How do you keep land at agricultural land values as opposed to house land values?
“One thing, of course, is to have land use,” Sorrells said, referring to the county’s land-use program, which allows property owners who are willing to agree to keep their ag and forest lands development-free a substantial discount on their county taxes. “But land use is a five-year thing. And it can shift really at any period in time depending on the priorities of the landowner,” Sorrells said.
“The other things you could do is have an active purchase of development rights program,” Sorrells said, talking about a sort of permanent version of land use wherein landowners give up development rights on a parcel in perpetuity in exchange for tax breaks that failed to win the support of a majority of the board in a vote in 2007.
“You could have conservation easements, which we do have a strong volunteer private conservation-easement program. You can also do things like allow less cutoff – I’m not saying no lot cutoffs on agriculture land, but make it more restrictive. When people do boundary-line adjustments, you could put a time delay in there or a year or two before you can cut off a lot to try to slow down some of the activity that we’re seeing. We could restrict the use of engineered systems so that if the land doesn’t perc, no longer is it considered buildable land. We could restrict steep slopes from building. We could restrict ridgetops. We could have restrictions in floodplains,” Sorrells said.
“All those things are very touchy because we’re touching on people’s property rights. Every time we’ve tried to do much about that, the room is filled up with people who say we’re infringing on their property rights,” Sorrells said.
“People want to have their cake and eat it, too. Maybe they’ll think about it differently now. Maybe they won’t,” Sorrells said.
The bulk of Joan and Arlie Wolfe’s property is in land use. The largest individual parcel, assessed at $1.56 million in the new assessment, will cost them just $1,247.46 in taxes.
“But what happens if the county decides to get rid of land use? We couldn’t afford to pay taxes on $1.6 million. We’d have to sell,” Arlie Wolfe said, citing claims raised most strenuously by Francis Chester that the board of supervisors is preparing to hit farmers in Augusta County with a sort of double whammy – first this year with the reassessments and then next year with an end to the land-use program.
I don’t get a sense of anything close to that actually being the case, so let’s call that one a red herring and be done with the fearmongering.
Not everybody seeing the sharp assessment increases is in the same boat as the Wolfes, of course. Which is to say, not everybody has their all-the-sudden-valuable land in land use, and it’s not as simple as putting down a couple of John Hancocks to get the tax deductions from the county under the terms of the program.
Bottom line – we need to find a way to get beyond the fingerpointing and namecalling and start working toward some solutions to this problem. It’s plainly obvious to me that something seems … screwy … with those sharp assessment increases.
Did Blue Ridge Mass Appraisal fail to take into account the sudden and steep drop in the market in the fourth quarter of 2008 that has been reflected in data from the Virginia Association of Realtors for the Greater Augusta market as a whole? If so, could it perhaps be given some sort of extension to try to come up with more accurate figures that could maybe be adopted if not in time for 2009 taxes then 2010?
I don’t know the answer to the first question, but I’ll say again, something just doesn’t seem right with the numbers that came out of the work, whatever the inputs might have been.
The answer to the second question is clear. It could cost county taxpayers up to $40,000 to delay the process a year with the aim of getting it right.
We do want to get it right, don’t we? That is the ultimate aim of government. Right?
So what are we dawdling on this for?
– Story by Chris Graham