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HomeMy WebLinkAbout04-26-2000 Board of Review Minutes• MINUTES OF THE ORONO BOARD OF REVIEW MEETING Wednesday, April 26, 2000 7:00 o'clock p.m. ROLL The Orono Board of Review met on the above date with the following members present: Mayor Gabriel Jabbour, Council Members Richard Flint, Barbara Peterson, Charles Kelley, and Bob Sansevere. The following represented City Staff: City Administrator Ron Moorse, Hennepin County Appraiser Kim Jensen, Hennepin County Senior Appraiser William Davy, and Recorder Jackie Young. Mayor Jabbour called the meeting to order at 7:02 p.m. Mayor Jabbour explained the Board of Review process, noting that the City will listen to the comments of the residents regarding their evaluation, request that the assessor visit the property, followed by another Board of Review meeting. Davy commented this is the second year Hennepin County has been employed as the assessor for Orono. Davy remarked there is a tremendous demand for land in this area and west of here, • which is pushing land values up in this area. Davy stated the values are arrived at by studying the market and doing market ratio studies of sales throughout Orono. Of the 2,700 approximate residential homes in Orono, there were 132 sales in the past year, which is approximately 4.6 percent of the homes. Those sales are then analyzed, with the sale prices being compared with what their values were set at for the 1999 valuation. Davy stated that this comparison enables Hennepin County to determine where they are at in terms of valuation and the fair market value of the homes in this area. Davy stated each year they physically visit one -fourth of the City, with the values being adjusted based on the sales of the previous year. Davy stated they have received approximately 140 phone calls regarding their values, with a portion of those properties being reviewed prior to tonight's meeting. If a property owner is dissatisfied with their valuation, they have the right to appeal to the Board of Review at the City level. By appealing to the Board, the assessor will review the information on file regarding the property. The property owner may request that the assessor visit the property and provide information on how that valuation is obtained. After reviewing the property, the assessor brings his findings back to the City Council for their approval and the property owner may appear at the reconvened Board of Review if he is still dissatisfied with the valuation assigned to the property. Mayor Jabbour indicated that the assessor is required by law to assess property fairly according to the market value, with the City of Orono being penalized if the assessed property values are not within the range of actual sales in the City. Jabbour explained the City of Orono receives the same • amount of money regardless of the value set on each individual home. Jabbour noted the City does • MINUTES OF THE ORONO BOARD OF REVIEW HELD APRIL 26, 2000 not like to see residents being forced to move due to taxes, but that is not a factor that can be considered in determining the appropriate value for the residence. Mayor Jabbour explained the appeals will be heard in the order in which the property owners have signed in upon arriving. He requested that each owner state his name, address of their property, property identification number, and any other information the property owner feels is appropriate. A VJA3&I 1. Raj Maheshwari, 80 Truffula Trail. Maheshwari stated he disagrees with the valuation placed on his property, and requested that the assessor visit the property. Maheshwari stated he resides on a private road and does not receive any city or county services. Maheshwari stated the costs to construct a new home are lower than what his valuation is set at. The appraised value for the year 2000 is $424,300, with last year's value being listed at $387,000. Sansevere inquired what steps the assessor takes in determining someone's value on their is property. Davy stated they do a complete walk through of the residence, take measurements, talk to the property owner to find out any concerns or problems with the house, and review any independent appraisals the property owner may have. Davy noted refinance appraisals tend to be on the lower side. Sansevere inquired whether the property owner should have an independent appraisal done. Davy stated it is not necessary and it is up to the property owner. Mayor Jabbour requested the Assessor visit the property before the Board of Review is reconvened. 2. Mary Nicoll, 160 Smith Avenue. Nicoll stated they have had an independent appraisal completed on the property, which has just recently been sent to the appraiser's office. Davy noted he did receive the appraisal this morning. Nicoll commented in their view the valuation on their home is outrageous, with this year's value being listed at $597,000. Nicoll stated the value on their home is not in line with other comparables in the area. • Page 2 • MINUTES OF THE ORONO BOARD OF REVIEW HELD APRIL 26, 2000 Mayor Jabbour requested the Assessor review the independent appraisal and review the site. Moorse noted the Board of Review will reconvene on May 8th. 3. James Bull, Jr., 1330 Cherry Place. Bull expressed concerns that his land is being valued too high. Bull stated his market value for 1999 was $293,000, with this year's value being listed at $363,000. Bull indicated this is a 23.9 percent increase, which is excessive in his view. Bull requested the Assessor visit his property. Mayor Jabbour commented the assessor's office typically will shift the value from the home to the land as the residence gets older and there is a good likelihood the home will be torn down. Jabbour stated the value of the home decreased while the value of the land increased. Davy stated land values in this area are increasing. Kelley inquired whether the assessor's office makes the assumption that some homes will be torn down. Davy stated that a potential a buyer may be looking for a building site on the lake and • is considering a tear -down, especially if the residence is older. Kelley stated in his opinion the system of arriving at property taxes should be reviewed and changed, noting that some long -time residents are being forced out of their homes due to the high taxes. Mayor Jabbour requested the Assessor visit the property prior to the next Board of Review meeting. 4. Thomas Ryan, 2350 Longview Circle. Ryan inquired whether the breakdown between the land and building values are different. Davy stated the value of the land depends on the size of the lot, the location in the City, and other factors. Ryan inquired whether the assessor looks at each development separately. Davy stated they look at each particular development and what the lots are selling for in reaching their land values. Ryan stated he purchased their home in 1978, has made no improvements over the years, • with their valuation for this year being listed at $483,000. Ryan indicated his roof, shingles, Page 3 MINUTES OF THE ORONO BOARD OF REVIEW • HELD APRIL 26, 2000 and windows are in bad shape and need to be repaired, which is estimated to cost approximately $100,000. Ryan stated the kitchen cabinets also need to be replaced. Ryan inquired whether any depreciation is factored into the values. Davy stated they do depreciate for the age of the home, which is calculated at one -half a percent a year. Davy stated for a 20 year home, they would be looking at approximately a ten percent depreciation factor. Ryan stated in his view a one -half percent depreciation factor is too low, noting the value of the house has gone up eight percent this year. Ryan commented a one -half depreciation factor would not even pay for residing of the house. Mayor Jabbour requested the Assessor visit the property. 5. Morris Nelson, 1900 Shoreline Drive. Nelson indicated he has spoken with the Assessor regarding his valuation. Nelson stated he owns two lots which are treated as one. Nelson stated Bill at the Assessor's office indicated he would have two buildable lots if a variance to build is granted on the one lot. Nelson stated since there is no request for a variance at this time, the land should be treated and valued as an unbuildable lot. • Mayor Jabbour commented he has a concern if the lot is being taxed as a buildable lot when there are variances that need to be approved prior to any structure being erected on the property because it may be taking authority away from the City Council and forcing them to approve the variances in order to make the property buildable simply because the land was valued as buildable. • Davy indicated there was a considerable increase in the value of the land. Davy stated he has spoken with City Staff regarding the definition of buildable and non - buildable, noting the land is less than two acres and would not be considered as a buildable lot. Davy stated the property is being valued currently as adding value to the principal site. Nelson indicated he was given different information earlier and was told that his land was being taxed as two buildable lots. Mayor Jabbour suggested the property owner speak with the Assessor regarding his valuation. Jabbour noted land values are increasing in the area. 6. Lindy Purdy, 1975 Fagerness Point Road. Purdy stated they have resided in their home for the past 27 years, with the purchase price being $24,000. They have experienced a 400 percent increase in the value of their property over the years and are now facing the situation where they are being taxed out of their home. Purdy commented in her view the real estate market has ups and downs. Purdy remarked in her experience property taxes Page 4 MINUTES OF THE ORONO BOARD OF REVIEW HELD APRIL 26, 2000 do not decrease if the real estate market goes down, which is not fair in her opinion. Mayor Jabbour stated in the year 1976, the City experienced a 20 percent depreciation in lakeshore values. Jabbour stated the City receives the same amount of money regardless of the value set on each individual home, noting the City has to comply with levy limits. Purdy commented they have not experienced a tax decrease on their property taxes in the 27 years they have resided in the home. Purdy stated the value on their home has gone up the maximum amount allowable every year. Written Appeals Submitted: Ronald B. Sheldon, 3225 Bayside Road Jim Zimmerman, 2745 Shadywood Road Keith Aakre, 3127 Casco Circle CJI1911117,1u 1 �1►Y • Peterson moved, Sansevere seconded, to continue the Board of Review to Monday, May 8th at 6:30 p.m. The Board of Review was adjourned at 8:12 p.m. ATTEST: Linda S. Vee, City Clerk Gabriel Jabbour, Mayor • Page 5