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HomeMy WebLinkAbout04-24-2002 Board of Review MinutesMINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 • 7:00 o'clock p.m. ROLL The Orono Board of Review met on the above date with the following members present: Mayor Barbara Peterson, Council Members Richard Flint, Jim White, and Jay Nygard. Council Member Bob Sansevere was absent. The following represented City Staff. City Administrator Ron Moorse, Hennepin County Appraiser Kim Jensen, Hennepin County Appraiser Kevin Wynn, and Recorder Jackie Young. Mayor Peterson called the Board of Review hearing to order at 7:03 p.m. APPEALS Jensen stated the valuations are arrived at by studying the market and by doing market ratio studies of sales through the City of Orono. Those assessments are turned into the Hennepin County Review Board, which reviews the assessments to insure that certain standards are being met. Jensen indicated the Metropolitan Council has moved their affordable housing figure from $135,000 to $170,000, with market values across the metro area increasing on average 12 to 15 percent. Commercial properties have experienced an average increase of 5.2 percent, apartment buildings 16.7 percent, off -lake residential properties experienced an average increase of 10.8 percent, and lakeshore properties experienced a 13.9 percent increase. • Jensen stated each year the Hennepin County Assessors Office conducts a sales analysis to determine what type of valuation changes need to occur. Jensen stated the values are based on sales from October 1, 2000 to September 30, 2001, with the overall valuation of properties in the City needing to be between 90 percent and 105 percent of the valuation determined through the sales analysis. Jensen indicated following a comparison of the estimated market value to the sale price of the properties, they found that the market values were low and needed to be adjusted. Jensen stated each year the Hennepin County Assessors Office looks at one -fourth of the City, with this year being slightly different since the Assessor's Office was in the process of a quality conversion that has updated its building quality grade system to expand. Jensen stated approximately 50 percent of the properties were reviewed prior to the valuation notices being mailed. Jensen stated the County Assessor's Office will be looking at the remaining 50 percent to see that they have been converted correctly. Jensen stated in total they received calls from 140 people; with 64 total reviews being conducted, changes to valuations being 53 and no changes being 11. Jensen stated if after reviewing the valuation the property owner was not satisfied with the valuation, they were informed they could bring their concerns up at the Board of Review hearing. Jensen stated 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 local Board 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. The property owner may also choose to appeal the local Board's decision by appearing before the County Board of Equalization and Minnesota • Tax Court is always available. PAGE 1 MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 7:00 o'clock p.m. • Jensen indicated the amount of the increase is not important but what the property is worth and whether it can be sold at the valuation it is listed at. Jensen pointed out that if someone's property value increases by 20 percent, that does not necessarily mean the person's property taxes will be increased by 20 percent. Jensen requested that the Board close the meeting to any requests that the Assessor's Office may receive after tonight's meeting. Mayor Peterson stated the purpose of tonight's meeting is to listen to the comments of the residents regarding their valuation. The Local Board or property owner may request that the assessor visit the property and review their valuation, followed by a reconvened Board of Review meeting. 1. Harold Fames, appearing on behalf of Stephen Fames, Number One, Deering Island, PID 18- 117 -23 -31 -0001. Fames stated the value on the notice was $820,000, and in his view an appropriate valuation would be $174,584. Fames indicated this property was in tax court in 1993, setting the value for 1994. The adjudication in the tax court, that although the property was sold to him for $99,000, it had a true value of $125,000. Fames indicated the property was listed on the market for a long time, with the highest offer received being $107,000, with a $3,000 fee for the realtor. Fames distributed some comparables to the Board. Fames indicated the valuation of Deering Island has been increased 422 percent in three years, which is $663,000 more than the adjudication was eight years • ago. Fames stated Big Island has also experienced huge increases. Fames noted there have been no recent sales on Deering Island. Fames stated he did contact the Assessor's Office, and the value has been decreased to $637,000. Jensen indicated the Assessor's Office did receive a call from Stephen Fames and they lowered the value from $820,000 to $637,000 based on the survey supplied by Stephen Fames. Jensen stated Fames' survey indicated the property was smaller in size that what their survey depicted. Fames stated the property consists of 2.65 acres, with the amount of land being reduced by 57,923 square feet. Fames stated the value of the land was then increased by $26,571 per acre. Fames stated in his view the normal four percent increase should apply, and that the high valuation of this land has made this property very difficult to sell. White inquired why this property would be difficult to sell. Fames stated he is not aware of anyone that would pay half of what this property is valued at. Mayor Peterson inquired whether Mr. Fames would like the valuation to be $566,000. Fames stated he would like the valuation lowered to $175,000. Mayor Peterson questioned item number seven in the information supplied by Mr. Fames regarding the phantom land. • PAGE 2 lk MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 • 7:00 o'clock p.m. Fames indicated in his view the property should be valued at $175,000. White inquired whether the County Assessor's Office is in possession of the information that Mr. Fames distributed tonight. Jensen indicated they do not have a copy of the information Mr. Fames distributed tonight. Jensen stated the Board of Review will reconvene in 20 days, and in order for a further reduction in valuation to be considered, the Assessor's Office will need to visit the property and will also need to be provided access to the property since their office does not have a boat. Fames indicated providing transportation to the island is a problem since his son is not here, but that he is willing to provide a key to the residence so they may inspect the property. Mayor Peterson stated it is the property owner's responsibility to provide some transportation to the property. Jensen stated if they are unable to arrange for transportation out to the island, the next level of appeal would be the County Board of Equalization. Fames inquired whether there is state law requiring that they provide transportation for the Assessor's Office. Mayor Peterson stated it is the property owner's responsibility to provide transportation to the island. Fames indicated he does not have a boat but he perhaps could rent a boat. 2. Jim Johnson, 2240 Fox Street, PID 03- 117 -23 -32 -0009, stated his proposed valuation for 2002 is $488,000. Johnson stated in his view the property should be valued at $386,000. Johnson indicated the property has been divided into three parcels, with the residence now being on three acres of land and the other two lots being vacant at the present time. Johnson stated the property has been reduced from eight acres to three acres, but yet their taxable market value has increased from $315,500 to $488,000, which amounts to a 55 percent increase. Johnson noted the limited market value increased from $223,800 to $488,000, which is an increase of 118 percent. Johnson stated the intent of the subdivision was to help lower the valuation on their land. Johnson stated the land value is apparently based on a recent sale of a lot for $330,000, which consists of five acres. Johnson stated in his opinion his land valuation based on the comparable should be $198,000, with the house being valued at $188,000, for a total valuation of $386,000. Johnson indicated they have had an independent appraisal done in 2000, which suggested that the market value of 2240 Fox was $350,000. Johnson stated based on some comparable properties in the area, an appropriate 2002 valuation for 2240 Fox Street should be $223,800. Jensen stated they have not physically reviewed this property, noting the last time this property was • visited was in 1998. Jensen stated they are using some land sales that occurred on Willow Drive and a PAGE 3 MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 7:00 o'clock p.m. • tear down on Fox and Brown as comparables. Jensen stated the back lot has been sold to a developer, noting they have not received that sale. Johnson stated he has sold the two lots for $330,000. Jensen stated they did not have the sale for $330,000, but had the understanding it was to be sold for around $500,000. Jensen stated the developer has been promoting the sale as a package for $2.7 million. Johnson stated the size of his property has been reduced by 63 percent, but yet his value has increased by 118 percent. Jensen indicated they would like to visit the property. Mayor Peterson noted the Board of Review would reconvene on May 13`h at 6:30 p.m. Johnson commented in his view what may be built on this property or adjoining properties in the future should not be taken into consideration. Mayor Peterson stated that is not taken into account in determining valuation. Jensen stated she was attempting to show that there have been some vacant land sales in the area recently. 3. Andrew Rasher, 4705 North Shore Drive, 07- 117 -23 32 0058. Rasher stated the estimated value is $643,000. Rasher stated a recent appraisal of his property showed a valuation of $425,000. Rasher indicated the County Assessor's Office did review the property, and noted that the only access to the house at the present time is via a rather steep stairway, which may make the property difficult to sell. Mayor Peterson inquired whether this was lakeshore. Rasher stated it is. Jensen stated the value has been reduced to $622,000. Wynn stated he did view the property recently, with the square footage of the house being reduced somewhat, but an increase to the value of the house was made due to some improvements that have been made. Wynn indicated they did make an adjustment for the lot due to the access issue, which reduced the land value. Wynn stated a sale a few doors to the north that happened in approximately February of this year sold for $298,000, which is much smaller, 50 feet of frontage , and with a similar type access. Wynn stated in his opinion Rasher's property is worth twice as much as that property which recently sold, noting they did take into consideration the fact that they have reached the maximum on their hardcover for this lot. White inquired whether the County Assessor's Office has seen the appraisal. Wynn stated he has, noting that the lakeshore valuation was $145,000, and in his opinion lakeshore in this area sells for much more than that. Wynn stated in his opinion the appraiser may not know what • lakeshore is worth in this area. PAGE 4 MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 • 7:00 o'clock p.m. Rasher stated the total value on the appraisal is $425,000, which is around $200,000 less than the valuation placed on his property. Rasher distributed a photograph of his residence showing the stairway access to the house. Jensen stated there is $147,000 difference between the building value on the fee appraisal and their building valuation, noting there have been some improvements made to the landscaping and retaining walls by the lakeshore. White inquired how old the house is and how big the lot is. Rasher stated the house was built in 1968. Jensen stated the lot is approximately 24,000 square feet, with a lakeshore frontage of around 160 feet. The Local Board requested the County Assessor's Office revisit this property. 4. William Robinson, 505 Willow Drive, PID 04-117-23 410001, stated he has lived on this property for the last 14 years. Robinson stated last year his value was $792,000, with this year's valuation being $1.04 million. Robinson stated they have not made any improvements to the property, with the residence being approximately 24 years old. • Robinson questioned the huge increase, noting that it increased over $300,000, which in his view is not warranted. White inquired how many acres the property consists of Robinson stated the lot is 12 acres. White inquired whether Robinson has talked to the County Assessor's Office prior to tonight. Robinson stated he has not. The Local Board requested the County Assessor's Office visit this property. Robinson stated in the past he has experienced fairly steady increases, which is understandable, but expressed a concern with the 38 percent increase in valuation he experienced this year. 5. Roger Kirchner, 2000 Shadywood Road, PID 17-117-23-310001. Kirchner stated the proposed valuation on his property for 2003 is $446,000, which is slightly over a 40 percent increase from the year before. Kirchner stated his land is unique in shape, with only 45 feet of shoreline, and a small residence on the lot. Kirchner stated he experienced a 14 percent increase last year, with this year's increase being over 40 percent, which is concerning to him. Kirchner noted the County Assessor's Office has reduced his value to $428,000, which in his view is still too high for this property. Kirchner stated in his view the property should be increased by only 15 percent, which would increase his valuation to $365,000. PAGE 5 MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 7:00 o'clock p.m. • Jensen indicated they have not visited this property this year, noting the last time they visited the property was in 1999. Jensen stated there have been a couple of sales to the south of this property where the houses have been torn down, 50 -foot lots, and have sold for approximately $450,000. Jensen stated an adjustment to the frontage was made, which resulted in a decrease in the valuation. Jensen stated the property owner has between 20 and 25 feet of actual lakeshore frontage, which results in a lower land valuation than the other properties in the area. Jensen stated they do not view this property as being an immediate tear down, and they would need to look at the structure. The Local Board requested the County Assessor's Office visit this property. White indicated there are two programs Kirchner can apply for since he is retired if his property taxes increase by more than $100. White provided the information to Kirchner for his review. 6. Ward Edwards, 2474 Carman Street, PID 20- 117 -23 12 0027. Edwards stated the value of his property this year is $539,000, with the value last year being $490,700. White inquired whether this was lakeshore property. Edwards stated it is. Edwards stated he has a concern regarding the high increase this year. Edwards • inquired why there is a difference between the estimated market value and the limited market value. Jensen stated their office has not spoken with Mr. Edwards. Jensen stated the estimated market value this year is $781,000, with the estimated market value last year being $750,000. White inquired how much lakeshore this property has. Edwards stated it is 125 feet. Flint stated the reason why the limited market value increased was because of the 10 percent increase. Moorse commented the limited market value was at 8.5 and is now at 10 percent. Jensen stated the limited market value is $539,800, which means that the estimated market value increased by more than 10 percent in one year, with the new estimated market value being $785,000 versus the limited market value from last year of $490,700. Jensen stated the calculation to determine that would be the greater of the two numbers. Jensen explained the difference between the limited market value and the estimated market value over the next few years will eventually equal each other. Edwards inquired who determines the estimated market value. Jensen stated the County Assessor's Office determines that number, which is based on the sales activity in the area. Jensen indicated the building characteristics are determined on the structure and the improvements that have been made to the property. Jensen stated the County Assessor's Office has • determined based on what they have in their files that this property should be able to be sold at $785,000. PAGE 6 MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 • 7:00 o'clock p.m. • Edwards inquired whether an independent appraisal would be beneficial, noting he did have an appraisal done a few years ago. Jensen stated an independent appraisal costs approximately $350 and would be the decision of the property owner. Jensen stated the County Assessor's Office would review an independent appraisal if one is supplied. White noted an independent appraisal would need to be completed prior to May 13`h Flint noted they are in the process of phasing out this limited market value. White stated there is an opportunity to get some tax relief for people who are retired or semi - retired, and provided the information to Mr. Edwards. The Local Board directed the County Assessor's Office to visit this property. 7. Judy Rogosheske indicated her husband is George Funk, 540 Old Crystal Bay Road South, PID 04-117-2 42 0023. Rogosheske stated her property valuation has increased by over $200,000 this year, noting their house is over 100 years old and has not undergone any major improvements in recent years. Rogosheske stated there is no basement under the residence, has a tuck -under garage, and is in need of a new roof. Rogosheske indicated they live on a fairly busy road, which in her opinion decreases the value of their property. Rogosheske requested the County Assessor's Office visit her office. White inquired what the valuation was last year. Rogosheske stated last year her valuation was around $500,000, and is now over $700,000. The property consists of approximately seven acres. Jensen stated the County Attorney's Office has not visited this property this year, noting the valuation for this year is $733,000, with last year's valuation being $518,000. Jensen stated the land is currently valued at $418,000, with their records showing 6.8 acres. Jensen stated that averages to approximately $73,000 an acre, which is average for this area. The Local Board requested the County Assessor's Office visit this property. Mayor Peterson noted the City received the following written appeals: John Stielow, Outlot A, Hartwood, PID 15- 117 -23 210007 Dale K. Mahaffy, 290 Hollander Road Rick Windenburg and Shirley Hendrickson, 3200 North Shore Drive, Wayzata PAGE 7 MINUTES OF THE ORONO BOARD OF REVIEW HEARING Wednesday, April 24, 2002 7:00 o'clock p.m. • Peterson moved, Flint seconded, to continue the Board of Review hearing to May 13, 2002, at 6:30 p.m. VOTE: Ayes 4, Nays 0. ADJOURNMENT There being no further business to discuss, the hearing was adjourned at 8:38 p.m. ATTEST: Linda S. Vee, City Clerk Barbara Peterson, Mayor PAGE 8 • n lJ