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HomeMy WebLinkAbout04-15-2009 Council MinutesMINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 Alk 7:00 o'clock p.m. ROLL The Orono Board of Appeal and Equalization met on the above - mentioned date with the following people present: Mayor James White, Council Members James Murphy, Lili McMillan, and Doug Franchot. Representing Staff were City Administrator William Wells, Finance Director Ron Olson, Hennepin County Appraisers Thomas Kunik, Nathan Stulc, Tim Atchison, and Recorder Jackie Young. Council Member Bremer arrived at 7:08 p.m. Mayor White called the meeting to order at 7:00 p.m. APPEALS White stated the purpose of tonight's meeting is to review people's assessments and to give the residents an opportunity to explain in their view why their assessments are incorrect. 1. Mary and Mike Plank, 4145 Watertown Road, PID 31- 118 -23 41 -0013 Mrs. Plank stated one of the main reasons they are here tonight questioning their valuation relates to the lack of comparables that were provided by the Assessor's Office. Plank indicated she personally had a very difficult time finding comparables in Orono. One of the comparables is for a property valued in excess of a million dollars, which in her view is not a good comparable since they do not have any. fencing, a pool, or indoor riding arena. McMillan asked whether the Planks feel there is something that the assessor should consider. Mrs. Plank stated they basically disagreed with the comparable because the other property has been improved and there are horses on the property. Due to the high taxes they have had to pay over the years, they have been unable to make improvements to their property and that in their opinion the valuation is too high. McMillan asked whether this is a property that would eventually be subdivided. Kunik indicated he did speak with the Planks and that it was his understanding that the property owner Would get back to him with some comparables or market analysis and that he did not hear from the Planks. Kunik stated the Planks had mentioned a possible wetland on the property, which was adjusted, but the Planks were not satisfied with the adjustment. Kunik stated he has'come up with some other comparables and would be willing to review the property again. Mr. Plank asked what information has been obtained by the Assessor's Office. Kunik stated they have come up with other similar properties in the City. Mr. Plank asked whether those comparables are properties that have been sold within the required time frame. Kunik indicated they are not sold properties. PAGE 1 r MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. • White requested the Assessor's Office review the new information with the Planks. White noted if this is a property that can be subdivided, the property tends to be worth more. Mr. Plank noted he has one lot and that he does not want to be in a position where he is forced to subdivide his property due to the taxes. Plank stated they have not made any improvements to their property and that it is still the original house. Plank indicated he does not understand why they are discussing a possible future lot in relation to his taxes. Kunik stated the Assessor's Office did not take the possible subdivision in the future into consideration when assessing this property and that the comparables provided by the Planks were not proper comparables. Kunik*noted they did adjust the valuation downward and that the comparables are limited given the minimal amount of sales in the area. Murphy stated it appears that the Assessor's Office was waiting to hear back from the Planks and that the Assessor's Office has indicated they have some additional information that they would be willing to review with the Planks. Mrs. Plank pointed out that there were no other comparables relating to sold properties that could be shared with the Assessor's Office. Kunik stated they would contact the Planks within the next week to discuss their situation. 2. Richard Crosby, 2705 Walter Port Lane, PID 21- 117 -23 23 -0013 Crosby noted he has provided some comparables of sold properties to the Assessor's Office and that his property is a channel property, which should be valued less than lakeshore. Both of his neighbors have similar sized lots, slightly bigger homes, but his taxes for the past three years have been approximately $1000 higher than either of them. Crosby stated he told the Assessor last year that house values would fall, and that he was told last year by the Assessor that lakeshore values will not fall, which has not been the case. Crosby stated in his view the property values are over- inflated. At the time he purchased his property, his taxes were $5,658 but are now at $8,341. His property is now worth less than what he paid for it in 2005. On average he has paid over $1000 more than both of his neighbors for the past three years. A previous assessor has stated that the private road is a luxury but yet the costs for maintaining the road are borne by the residents. Crosby noted his property also had significant drainage issues that he was forced to correct at his expense with no assistance from the City. Crosby asked the Assessor to provide him with comparables of sold properties. Kunik noted that Assessor Stulc has a comparable for 997 Wildhurst, which is also a channel property on Forest Arm Bay. The property has a house consisting of 1,812 square feet that was constructed in 1973 and sold for $850,000 in November of 2007. Mr. Crosby's house consists of 3,294 square feet, which is substantially bigger and newer. Kunik stated in his view the value is appropriate. Crosby stated Fennon Lane has a brand -new house consisting of 4,000 plus square feet located on the channel and it sold for $730,000. Kunik stated the Assessor's Office looks at highest and best use and that they are not looking for the lowest property value but the highest property values, which is what the State requires. PAGE 2 =1 46 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. Crosby stated 560 Centerview Lane is another comparable. Kunik asked what city that is located in. Crosby stated that is located in Mound. White requested Mr. Crosby discuss his valuation with the Assessor's Value at another date. White stated he understands the need to appear at tonight's meeting prior to going to the County Board. White noted Orono has the lowest tax rate in the seven county metro area and that they have safe schools and roads. Orono also has the lowest number of staff members employed of any of the cities in Hennepin County. White stated in his view the City is doing their best to keep the costs of the City down. Crosby stated he would like to see one channel property that is similar to his that sold for more money than what his property has been valued at. Kunik stated he could find a channel property that is assessed at the same or higher than Mr. Crosby's but that it is difficult to find one that sold within the required time period. Kunik stated the Assessor's Office will look into Mr. Crosby's situation but that the property values throughout the City are set based on the sales. 3. Heather Johnston, 3285 Crystal Bay Road, PID 17- 117 -23 41 -0015 Johnston stated her property is located on the lake and that she experienced an increase of 16.7 percent this year. Johnston indicated she did leave a message with the Assessor's Office on April 6"', April 7"', and April 8"', and that she was told they would call her back for an appointment. The Assessor's Office did call back on April 8`h, but Nate stated that her property is valued at the current market rate and that they would not be reducing her property. Johnston indicated she did compile some comparables but was unable to find any sold properties that were comparable, so she looked at the difference in land values. Her land is valued at $900,000 A similar property in her neighborhood located at 3285 Crystal Bay Road is valued at $629,700. Johnston noted her house was constructed in 1920 and is only valued at $10,000, which, is why she did not compare house values. The taxes on-her lot are $8,101.77 and the taxes on 3205 are $6,396.74. The property located at 3215 Crystal Bay Road has approximately 30 more feet of lakeshore, more acreage, and was refinanced in March at $780,000. Another comparable at 3345 Crystal Bay Road was listed at $899,000, an offer was received at $850,000, and its estimated market value was $956,000. The taxes on that property are $7,768.00. Johnston noted her land value is $300,000 more than that property. Johnston indicated another comparable located at 3399 Crystal Bay Road just went on the market for $787,500. The land value is $663,800, for a total valuation of 800,600. The total tax is $7,164.24. Johnston noted the majority of the taxes for similar properties are approximately $1,100 less than hers. Johnston stated she also called the governor's office and spoke to a Mr. Meyer. She told him that she ' experienced a tax increase of 16.7 percent this year and was told that the Legislature is attempting to remove the 3.9 percent cap. PAGE 3 NIINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. Johnston stated she also called her legislative representative and spoke with her legal assistant on April 7th. The written response she received states the following: Thank you for calling my office to.alert me to your concern about your property tax increases. You mentioned to my assistant that your taxes have been raised by 16.7 percent. This amount does seem to be excessive. You might want to take a look at your tax statement to see where the tax increases are coming from. Cities have levy limits that are capped at 3.9 percent. However, Long Lake's population, which is below the levy limit, might have raised your taxes over the 3.9 percent. Johnston noted she does not reside in Long Lake. Murphy asked what "her zip code was. Johnston stated she has a Wayzata zip code. The letter goes on to state that, I believe you are in the Orono School District, which she is not. Johnston indicated she is in the Westonka School District. The letter went on to say that the Orono School District held a referendum last year. You might want to check to see if there was another source of your property tax increases. White stated there was a limited market value issue which allowed for residents to have capped property tax increases: The legislature decided there was getting to be a big gap between the cap and the real market value, which resulted in_a higher than normal increase. Kunik stated the limited market value went away this year for taxes payable in 2010, which did hold down property taxes from the year before. Kunik asked what her valuation and limited market value was in 2008. Johnston stated her taxable market value in 2007 was $797,000. Johnston asked if the removal of the cap by the Legislature contributed to the 16.7 percent increase. Kunik stated it did. White requested the Assessor's Office review the information provided by Ms. Johnston. Kunik stated her value did not increase from 2008. Kunik stated the Assessor's Office cannot discuss prior year's taxes tonight since they have already been assessed and paid. 4. Daniel O'Donoghue, 1770 Shadywood Road, PID 17- 117 -23 21 -0023 O'Donoghue stated one of the issues he encountered was the lack of comparables. O'Donoghue noted in the case where comparables are not available or limited, it was his understanding the assessors look for trends, and that in his opinion the trend has been downward. O'Donoghue indicated he did speak at the Board of Equalization last year, which was the beginning of the decline, and was told by the Assessor's Office that the market was flattening out. O'Donoghue noted the market has, in fact, go down, but yet his assessed value increased 12 percent. O'Donoghue stated he is not aware of any trend where any property values have increased in this area by 12 percent. O'Donoghue noted that Assessor Stulc gave him an assessed value of $30,000 less, but that in his view he should receive a further reduction based on the trends. O'Donoghue stated the assessor also stated last year that the valuation is a lagging number. In other words, his 2010 taxes will go down. O'Donoghue stated as it relates to limited market value, if you resided in your house for 20 or 30 years, you did receive a benefit from the cap because you have PAGE 4 • MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. underpaid, but unfortunately he has resided in his house seven years and is in essence making up the difference and is on the upside. White stated that is one reason why they eliminated that cap because it did create inequalities. O'Donoghue indicated he would contact the Assessor's Office and speak with them. Murphy stated the City Council does look at trends and that the trends are down, which will create some tax breaks for the residents next year. McMillan commented the lag affect helps cities do their budgeting but is a negative for the property owners. O'Donoghue asked how true and accurate the predicted value is over time. Kunik indicated they are in the process of setting the estimated market value, which is based on sales that took place from October 1, 2007, to September 30, 2008, which is how they arrive at that number. O'Donoghue asked whether any study has been done on the previous years projected values. Kunik indicated the Assessor's Office is fairly close on their projected values to the actual values. Murphy noted there was a referendum passed by the Orono School District, which has also increased the residents' taxes. An audience member asked whether the Assessor's Office takes foreclosures into account. Stulc indicated they do not take foreclosures into account. Franchot noted the Assessor's Office takes arms length sales into consideration. The audience member commented that there were a number of residences where the sales price of the property was escalated. Then when the house goes.into foreclosure, it is not a true valuation when it sold. The resident questioned whether much research has gone into the Assessor's comparables to see whether they were part of a fraud. White stated unfortunately the Board of Equalization does not have time to discuss issues like that, but suggested the resident contact the Assessor's Office. 5. Mark and Bonnie Hector, 3265 Carman Road, PID 20- 117 -23 14 0011 Mrs. Hector indicated she has been involved in real estate for the past 14 years and has spoken with the Assessor's Office several times. Their house is located on a cove and is not directly on the lake. Assessor Stulc only provided them with comparisons for lakeshore on Casco Point, which is valued considerably higher than a cove lakeshore. Hector noted they cannot swim in the cove and they have low water levels with a mucky bottom. • Hector stated she pulled together six comparables, made some adjustments for busy roads and lakeshore that is located across a busy road, which does impact the value. Stulc spoke about acreage, and their PAGE 5 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. property consists of .39 acres. The majority of the comparables have approximately .25 acres, and she attempted to make fair adjustments for that on the comparables. Based on those comparables, in her view the adjusted value on their property should be about $895,000 but they are currently at $1.193 million. Assessor Stulc reduced it to $1.1 million, but in her opinion it is still quite high. White asked when the house was purchased. Hector stated it was purchased in 2004. White asked whether the Assessor's Office has seen the comparables. Hector indicated they have not. The City Council requested the Assessor's Office contact the Hectors. 6. Ward Edwards, 2474 Carman Street, PID 20- 117 -23 12 0027 7. Richard Edwards, 2480 Carman Street, PID 20- 117 -23 12 0028 Richard Edwards stated the two lots that they own are located on the northeast side of Carman Bay and that their lots go east to west, which results in a substantial amount of weeds being washed up on their shore. Edwards indicated they routinely pick up the weeds and milfoil and haul out approximately 60 trailer loads of weeds every year. Murphy asked whether the Edwards have contacted the Assessor's Office. Richard Edwards indicated they have and that they have shown them an appraisal. White noted the Edwards feel the value of the lots is 750 versus the 1.291 million for 2009. Richard Edwards stated the appraisals are certified by the state. Stulc noted they do have copies of the appraisal. Kunik indicated they are refinance appraisals and that the appraisals appear to have a set value going in. The comparables do not utilize highest and best use and creates other issues. Kunik indicated the Assessor's Office has provided the Edwards with some better sale comparables. Kunik stated the mortgage companies and banks have basically set a price and that is what they are appraising them at. Ward Edwards stated they did provide four other certified appraisals. Kunik indicated they would look at the information and get back to the Edwards. White commented property taxes are an issue that the City takes seriously and that they would like the citizens who helped build the city be financially able to stay in the city upon retirement. Richard Edwards noted there is a bowling center that is also going in near their properties, which will cause issues with noise and lights. Edwards noted they also have noise issues with motorcycles during the summer. • PAGE 6 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 • 7:00 o'clock p.m. 8. John Waldron, 1951 Concordia- Street, PID 18- 117 -23 14 0011 Waldron stated his tax statement for 2009 lists a value of $900,000 for their property, and the value that they feel is reasonable is 750,000. Waldron provided .the Equalization Board with the most comparable property he could find, which has been on the market for over a year, consists of three bedrooms, and two baths. Waldron noted that is the same as his residence. Both lots have 75 feet on the lake and were constructed approximately the same time. The comparable has 1,720 finished square feet on the first floor and his residence has 1,600. The lot sizes are approximately the same. Waldron stated this comparable is almost identical with his property and is now listed at $749,900. Waldron stated he believes it will sell for somewhat less than $750,000. The City Council requested the Assessor's Office review the comparable and contact Mr. Waldron in the near future. 9. Tom Frahm, 3105 North Shore Drive, PID 09- 117 -23 32 0016 Frahm stated in 1998 he purchased the property for $685,000. The property last year was valued at $1.940 million, which comes out to be a 10 to 15 percent increase every year since then. This year his property was valued $8,000 less than a $2 million dollar house. Frahm indicated he provided the Assessor's Office with some comparables and spoke with the Assessor's Office. over the phone. Kunik stated he does not have the information in front of him and that he does not know what the property is valued at. Frahm pointed out the house has some settling problems and that it is likely the house will be razed if the property is sold. The property also has some drainage issues that need to be corrected. White asked if the assessor has visited the property. Frahm stated they have not. Stulc stated they will go out and visit the property. 10. Steve Sobieniak, 3399 Crystal Bay Road, PID 17- 117 -23 44 0021 Stulc noted he has spoken with Mr. Sobieniak earlier this evening and that they would be setting up an appointment to meet with him. 11. Kenton H. Carlson, 3498 North Shore Drive, PID 08- 117 -23 43 0015 Carlson indicated he has resided in his property for approximately 40 years and that he is aware that the state and the county require so many dollars to operate. Carlson stated he has seen a 100 percent increase in his property valuation from 2004 to 2009, which is brutal. Carlson indicated he would appreciate an opportunity to go to the county meeting because he would like to voice his concerns. • Carlson stated he understands that everyone has to pay the piper but that he would like to know how the assessor arrived at his valuation. PAGE 7 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. . Stulc stated they would contact Mr. Carlson to schedule an appointment. Carlson stated the state, county, and city need to keep their spending within reason. 12. Lester Thompson, 2880 Fox Street, PID 10- 117 -23 31 -0011 Stulc stated he has spoken with his wife and scheduled an appointment. 13. Alan R. Nettles, 1940 Shoreline Drive, PID 10- 117 -23 42 0007 Nettles stated he has resided at his property since 1987, and that his property is valued at $879,000 this year, was valued at $883,000 last year, and the year before was $807,000. His value has increased by $76,000. Properties for sale on Shoreline Drive are not selling but yet his value has only decreased by $4,000. His property consists of two acres, half of which is wetland. Nettles stated he would like to subdivide his property but the City would likely not allow it. Nettles noted his lakeshore is far less desirable than the lakeshore of his neighbors because he is located next to Sailor's World and that he deals with a great deal of garbage and debris. A comparable sold for $840,000 at the end of 2007. The majority of his valuation is comprised of lakeshore. Nettles noted he has called the City twice asking for comparables and then wrote a letter. The comparable that sold_ was sold during a better market than what exists currently. Nettles stated in his view the residence would be torn down if the property were sold. Nettles requested the Assessor's Office look at the property next door. Nettles commented the properties are not selling in his area and that he is also located on Highway 15, which is an extremely busy road. Nettles stated the Assessor's Office has not visited his property. The City Council requested the Assessor's Office review Mr. Nettles' property. 14. Robert D. DeVere, 2670 Countryside Drive West, PID 04- 117 -23 12 0013 DeVere stated he did speak with Mr. Stulc and later called back and spoke with Mr. Kunik, who was rather abrupt with him. He sent Mr. Kunik his information and was told he would receive a call back. DeVere indicated he did not hear back from Mr. Kunik. DeVere indicated he purchased the property in 1996. In October 2004, the next door property sold for $862,500. The two houses were constructed by the same developer and the house sold for approximately $100,000 less than what his valuation was in 2004. At that time he called the Assessor's Office, they came out and visited the property, and reduced the value to $900,000. DeVere stated he felt that valuation was still somewhat unfair but did not contest it. DeVere stated a comparable property located at 2700 Countryside Drive West has an estimated market value of $915,000 and his is at $993,000. His house does not have a swimming pool, which his neighbors have. Another house currently on the market in the area is 2570 Thoroughbred, which is located in the • same development. It was constructed by the same builder, has an unfinished basement, and is valued for PAGE 8 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 • 7:00 o'clock p.m. • $740,000. The house sold in June of 2005 for $840,000. The only difference is the fmished basement but yet his value is $250,000 more. DeVere indicated he also spoke with Robert Hair about the possibility of selling his house. DeVere stated they put it on the MSL listing at $939,000. There were a number of people that looked at the house.but that they received comments that it required a large number of cosmetic improvements. DeVere stated he unfortunately has not been paying attention to his values and that when he spoke with the Assessor's Office, Mr. Kunik was very unpleasant to deal with. DeVerse stated he feels his property should be valued at approximately $840,000, and that he would be interested to know what his neighbor's value is for the current year. The City Council requested the Assessor's Office review Mr. DeVere's property and review the comparables. 15. Forrest G. Burke, 380 Leaf Street, PID 04- 117 -23 23 -0027 Stulc noted he did speak with Mr. Burke earlier this evening and set an appointment to meet with him. 16. Natalye Chernerskaya, 2490 Casco Point Road, PID 20- 117 -23 210036 Stulc noted he did speak with Ms. Chernerskaya earlier this evening and set an appointment to meet with her. 17. Allan Larson, 3852 Cherry Avenue, PID 08- 117 -23 33 0088 Stulc noted he did speak with Mr. Larson earlier this evening and set an appointment to meet with him. 18. Jon Hofer, 3339 Crystal Bay Road, PID 17- 117 -23 410021 Hofer noted his value decreased by only 1.5 percent this year. He spoke with Assessor Stulc and provided the Assessor's Office with a number of comparables but was told they were too recent. Hofer indicated he has some comparables he would like the Assessor's Office to review. White stated the window the Assessor's Office looks at does not include 2009. Hofer stated he will retain his comparables for 2009, but that he would like to see some relief based on the current situation. There are houses on his street and in the area that are still on the market. One comparable house is listed for $649,000, which has a 1,000 square feet larger and still remains on the market. Another comparable house is located at 2691 Casco Point Road. That house sold in March for $630,000 but was valued at $840,000 and is a better house than his house. The City Council requested the Assessor's Office review Mr. Hofer's property and comparables. Hofer stated in his view he would be lucky to sell it for $600,000 and that it is a tear -down. The house next door to him is brand -new and is listed for $200,000 more than his house but is not selling. PAGE 9 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. • 19. John Henrich, 4125 Highwood Road, PID 07- 117 -23 44 0084 Henrich stated his house was valued this year at $1.7 million and consists of .7 acres. The Assessor's Office used comparables located on Highwood Road and Casco Point, which is not reasonable. Henrich stated he did speak with the Assessor's Office and requested that they visit his property. The City Council requested the Assessor's Office review Mr. Henrich's property. 20. Dan Crear, 3701 Shoreline Drive, PID 20- 117 -23 210033 Crear noted his property is zoned commercial and that he believes his value is way out of line. The value on the property has escalated by 50 percent over the last four to five years. Crear stated he bought out his partners in 2007 for $500,000. Crear stated his property is currently valued at $600,000. He contested his valuation last year and went before the County Board, who reduced his valuation to $600,000. He has met with Josh Hoglund, who visited the property and has received all of his financial information. The building is currently at 50 percent occupancy. Two years ago it was at 100 percent occupancy. Crear stated Navarre needs a long -term plan to help revive the area. Crear indicated he is projected to lose $9,000 this year and that he lost $6,000 last year. Since he met with the appraiser approximately one month ago, he has lost three more tenants and that he was forced to • drop the rent on three others in an attempt to retain them. The property will be sold on value since it is commercial but was told by the appraiser that the best use is owner- occupied. Crear indicated this property will always have retail tenants even if it is owner- occupied. Crear pointed out he will lose money on the property. Crear noted if his valuation is dropped by $100,000, his taxes would only decrease by $1,500, which does not come close to making up his losses. . Crear stated one of the issues is the fact that the tenants do not have individual utilities. Gas is going up. Crear stated he has to pay all the expenses in the building due to the way it was constructed. The state agreed last year that it is an unusual property, hard to value, and hard to find comparables. It was built 28 years ago for approximately $650,000, and the value has not really changed. Crear stated it is unreasonable for Hennepin County to increase the value in a good market but then not reduce it in a bad market. Crear stated he will be appealing his valuation to the county. Hoglund stated he did visit the property and did an income approach to arrive at the valuation. Crear stated he was told by the appraiser that the property was worth $600,000. Hoglund stated the property did maintain its value from last year. Crear indicated he was told by a realtor that it went down 20 percent. Hoglund indicated the value of the property was undervalued last year based on the mortgage cap rate and other factors. Hoglund agreed that the vacancy rate is far above the other properties he has analyzed and as a result he utilized a vacancy percent of 20 percent. A potential buyer for the property would probably • use it as an owner- occupant property with a portion leased out, which is typical for a property this size. A potential investor is going to base his price on what is there. PAGE 10 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 • 7:00 o'clock p.m. Crear stated the assessor is speculating that the tenant rate will be at 80 percent. His tenants are small business owners and that they are not doing well. Crear stated appraisers should not go on speculation when valuing properties and say it should be 80 percent. Crear noted his occupancy rate has not been at 80 percent in well over a year and continues to drop. Murphy asked whether Mr. Crear would like to meet with Mr. Hoglund again. Hoglund indicated he did his market analysis and would not be changing it. Crear noted he did put it on the market for $600,000 and provided his realtor the value as assessed by Hennepin County. Crear indicated it is doubtful he will receive that much for the property. 21. Stephanie Barbour, 4515 North Shore Drive, PID 07- 117 -23 31 -0006 Barbour stated her value for 2009 was $1.856 million. Wells Fargo appraised their house in January of 2009 due to the number of foreclosures in their neighborhood. Wells Fargo's appraisal has six comparables within five miles of their house. That information has been provided to Mr. Stulc. Barbour indicated they did challenge the appraisal but were told by Wells Fargo that this appraiser has been in the area for the past 30 years and that they were confident it was correct and refused to change it. The City Council requested the Assessor's Office review Ms. Barbour's property and comparables. . 22. Daniel Regan, 3410 North Shore Drive, PID 08- 117 -23 43 -0017 Regan stated Mr. Stulc has visited his property and that he received some comparables today. His market value increased from 2003 to 2004 by 6.9 percent. The next year it went up 15.4 percent, then 16 percent, and then 19.7 percent. In four years his estimated market value has increased by 71 percent. White asked how long Mr. Regan has owned the property. Regan stated how long he has owned the property should not make a difference. White pointed out that it may have fallen under the limited market value guidelines. Regan stated he is talking estimated market value and not limited market value. Regan stated in his view the property should be valued around $700,000. White asked what the size of the lot is. Regan indicated it consists of half an acre. McMillan asked whether this is lakeshore. Regan stated the lakeshore is located across the street. Regan noted there are 4000 properties in the City and that there is a relatively small number of people in attendance at tonight's meeting, which probably - demonstrates that the majority of the people have values that are lower and are not dissatisfied with their values. PAGE 11 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. • Murphy stated he would dispute the fact that most people are happy with their taxes but that they like to live in this area. Murphy noted his taxes have more than doubled in the 20 years that he has resided in this area. Regan stated in his view he is paying more than his fair share. Stulc noted they did. reduce Mr. Regan's valuation on his property. Regan stated they reduced his value by half a percent, which is not adequate, especially given the fact that his property values increased by 72 percent. A comparable house sold at $840,000. His house was constructed in 1952 and has railroad tracks and a trail in the back. That lot is 2.3 acres and he has a half an acre. The property sold for $840,000 and his is valued at $840,000. Another comparable provided by the Hennepin County Assessor's Office is located at 1461 Bay Ridge Road. That property sold for $975,000 and has County Road 15 in front of it and consists of one acre. That property has 140 feet of lakeshore and he has 90 feet of shoreline. Regan indicated no improvements have been done to the house in 22 years. McMillan asked whether the assessor has visited the property. Stulc indicated he did visit the property last year. White stated the Council will be provided an analysis by the Assessor's Office and then reconvene in two weeks to discuss any valuations that remain unresolved. • Regan stated in his opinion he could sell the house for approximately $700,000. Murphy stated if Mr. Regan is not satisfied with the outcome, the next step is to go to the county. 23. Charles Reid, 1400 Baldur Park Road, PID 08- 117 -23 310001 Reid stated he does not feel his valuation should be raised. In the past four years his taxes have gone up 27 percent and his income has not gone up. The Assessor's Office has stated that lakeshore does not decrease but that he has seen lakeshore values go up and down over the past 24 years. Reid indicated he did not receive much satisfaction from the Assessor's Office. The City Council has authorized the construction of a large house next door to him, which will drive his values up even higher. White suggested Mr. Reid provide some comparables to the assessor. Reid stated he was not able to find any comparables in his neighborhood because the majority of the homes are newer. White commented it appears that Mr. Reid did experience a higher than average increase and that he would like the Assessor's Office to review this property. The City Council requested the Assessor's Office review Mr. Reid's property. • PAGE 12 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 • 7:00 o'clock p.m. 24. Mark Anderson, 575 Oxford Road, PID�05- 117 -23 410029 Anderson stated he did speak with Mr. Stulc earlier this evening but would like to point out that any property that increases over 100 percent in four years should be revalued. 25. Corky Klitzke, 555 Oxford Road, PID 05- 117 -23 410024 Klitzke stated the house was constructed in 1979. Her taxes in 2002 compared to 2009 have doubled. The economic climate is not conducive to values increasing and she does not understand why her values have increased. Klitzke indicated she did speak with Mr. Stulc but still feel that her valuation is way too high. Klitzke stated she had heard from some experts on Public Radio that the housing bubble has burst and that the market is now deflated. Experts feel that property values across the board have decreased 20 percent. Klitzke stated the City cannot ignore the current economic environment. 26. James Mulvanny, 559 Park Lane, PID 06- 117 -23 410044 Stulc stated he did speak with Mr. Mulvanny. 27. Stephanie Strobel, 430 Stubbs Bay Road, PID 32- 118 -23 13 0005 Kunik stated he did speak with someone prior to the meeting. 28. Martin Lueck and Mallory Mullins, 3250 Fox Street, PID 05- 117 -23 44 0013 and PID 05- 117 -23 44 0012 Mullins stated when they purchased the home in July 2005, the land was subdivided into two lots and that they purchased both lots. Mullins indicated she did speak with Tom Kunik on the telephone and received a phone message from Nate Stulc. She is not aware of the comparables that were used and would like an opportunity to review those and discuss how they are relevant. Mullins indicated she did review the Hennepin County website and looked at their neighboring properties. Mullins stated she is only talking about the assessed market values. All of the properties are located on Maxwell Bay with the exception of two big lots located at the end of Fox Street, which are located on Stubbs Bay. She evaluated how the lots and values compared with each other and determined that - 3125 Fox Street has 7.5 acres, 325 feet of lakeshore, rectangular property, a number of amenities, but experienced no increase. Mullins noted she is only looking at land values. Another property is located at 3175 Fox Street, which is a rectangular lot, 8 acres, has 315 feet of lakeshore, wooded property with a home close to the lake. Other lots on Fox Street include 3280 Fox, which consists of five acres; 3200, 3320, 3350, and 3400 Fox Street. These properties all front on Maxwell Bay. 3400 Fox Street is the point property on Fox, has 1400 feet of lakeshore and consists of approximately 7.5 acres. The last two properties on Fox Street are 3345 Fox Street, which is 4.7 acres of vacant land, and 3295 Fox Street, which consists of 4.25 acres and is also vacant. For all of these O properties, the assessed value for the land either stayed the same from 2008 to 2009 or decreased. Her property located at 3250 Fox Street is the only property that increased in value. PAGE 13 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. Mullins stated the 3400 Fox Street property experienced a decrease in the assessed value of the land between January of 2008 to January of 2009 of $500,000 or 11 percent. Additionally, the property at 3350 Fox Street experienced a 10 percent decrease. Their property located at 3250 Fox Street, which is a long, narrow lot, contains wetlands, has a steep slope, scrub trees, contains less than 200 feet on the lake, increased by $135,000, which resulted in their value increasing from $2.7 million to $2.835 million. Murphy indicated that would be approximately five percent. McMillan asked if she has spoken with the Assessor's Office. Mullins stated she did not speak in detail with the Assessor's Office. The City Council requested the Assessor's Office review the property and Ms. Mullins' information. Mullins stated historically they have experienced a significant jump in their land values and that there is no justification in the marketplace for the increase. Mullins indicated she has an issue with the land value for 3250 Fox Street, which contains the house. They were told at the time they purchased the home that it was a tear down by the realtor but they are still living in the house. Mullins indicated they do have some issues with the house. Mr. Lueck complimented his wife on her work in compiling the information. 29. Kevin Bjork, 4650 Creekwood Trail, PID 30- 118 -23 33 0006 Stulc stated he did speak with Mr. Bjork earlier in the evening. 30. Ann and Charles Hommeyer, 465 Linden Avenue, PID 06- 117 -23 410109 Charles Hommeyer stated they have resided here since 1984 and their taxes have doubled in the last five years. Up until the last couple of years, they didn't complain about the valuation because the houses were selling at the approximate value that they were valued at. Hommeyer stated if they do not experience a significant decrease next year, they will be back. Hommeyer indicated he did compile some comparables but he was told by Mr. Kunik that they were not true comparables. Mrs. Hommeyer stated she was told that they could not include foreclosed properties or short sales but was not sure why Kunik stated until the property sells, they do not know what the sale price will be. In addition, the comparable needs to fall within the required time period. Stulc stated a short sale would not be included because the person is going to go to their bank saying that they are going to go into foreclosure and would like to sell their mortgage short. The homeowners have to provide all their information that they are in fact losing their home and it then becomes a foreclosure property. 49 The City Council requested the Assessor's Office review the Hommeyers' property. • PAGE 14 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. 31. Bill Wyatt, 4235 North Sixth Avenue, PID 31- 118 -23 12 0013 Wyatt asked if the Board of Equalization meeting two weeks following this meeting was in place last year. McMillan indicated it was. Wyatt stated he probably should speak with the Assessor's Office. The City Council requested the Assessor's Office review Mr. Wyatt's property. 32. Dave Lindberg, 3440 North Shore Drive, PID 08- 117 -23 43 0019 Lindberg stated he did speak with Nate Stulc in regards to the value of his house and was provided with four comparables: 3490 Shoreline Drive, 1930 Shoreline Drive, 1501 Bay Ridge Road, and 2054 Shoreline Drive. He has reviewed the comparables. His house consists of 3500 square feet, has a three car garage, three bedrooms, and was constructed in 2003. Located approximately ten houses from his house is a 3100 square foot house consisting of three bedrooms, four baths, three car garage, and 50 feet of lakeshore. That property sold for $700,000. Lindberg indicated in his view that property is probably the most similar to his. Lindberg stated the other comparable was a house that consisted of 5,800 square feet and sold for $1.7 million, which is way out of line. That property is located across the road from the lake like their property is. It sold for $700,000. The two properties located on Bay Ridge are located quite a distance from the lake and both of the lots are larger than his. They are valued at $1.158 million but are requesting $900,000. Stulc stated the first fifty feet of lakeshore on North Shore Drive will be valued the highest at between 12,000 and 14,000. Lakeshore in excess of that would be valued at 6,000 per square foot. Lindberg stated he feels the comparable down the street is the closest and that he would like to see a reduction. White asked whether he has had sufficient time to discuss the information with the Assessor's Office. Stulc indicated they could discuss it further. The City Council requested the Assessor's Office review Mr. Lindberg's property. 33. Scott Prochnow, 4075 Highwood Road, PID 07- 117 -23 44 0009 Prochnow indicated he would like to go on record stating that he cannot afford the property taxes any longer. He moved out here in 1982 and he can remember reading almost every year about how people were getting taxed out of their homes. He has been able to manage their mortgage and they have adjusted their lifestyle but cannot manage the steady increases in their property taxes. • White asked what the assessed value is. PAGE 15 MINUTES OF THE ORONO BOARD OF APPEAL AND EQUALIZATION Wednesday, April 15, 2009 7:00 o'clock p.m. Prochnow stated in 2008, the limited market value was $849,900. His valuation was lowered approximately three, four years ago. Murphy commented he understands the concerns of the residents. McMillan stated property taxes are difficult because they are not income based. Prochnow stated he did write to the governor expressing his concerns. Prochnow asked if a record of this meeting goes to the county. Murphy stated the information will be passed along and that there are four representatives from the Hennepin County Assessor's Office in attendance at this meeting. Written Letters of Appeal Received: 1. Alan Nettles, 1940 Shoreline Drive, PID 10- 117 -23 42 0007 2. Barbara Pugh - McCreight and Kent McCreight, 692 Tonkawa Road, PID 05- 117 -23 33 0013 3. Mary Dayton, 1305 Sixth Avenue North, PID 26- 118 -23 34 0004 4. Gregg and Denise Steinhafel, 2285 North Shore Drive, PID 10- 117 -23 33 0006 5. R. Hunt Greene for Jane E. Piccard, 865 Partenwood Road, PID 05- 117 -23 43 0002 Kunik requested the Local Board of Appeal be closed to any further requests for reviews before the Orono Board of Appeal and Equalization. ADJOURNMENT Murphy moved, McMillan seconded, to close the Local Board of Appeal to any further requests for review, to recess tonight's meeting at 9:52 p.m., and to reconvene the Orono Local Board of Appeal and Equalization on April 27, 2009, commencing at 6:30 p.m. VOTE: Ayes 5, Nays 0. The Orono Board of Appeal and Equalization was adjourned at 9:52 p.m. ATTEST: 9—,Ll �- , Z in a S. Vee, City Clerk PAGE 16 a es M. White, Mayor .7 • •