May 17, 2006
In Southampton: Reassessments Frustrate Anxious Town Residents
Following notices sent to the residents of Southampton Town alerting them to the town's reassessment for 2006, many people were expected to attend Grievance Day in Hampton Bays yesterday in hopes of lowering their assessments and, they believed, their taxes. But town officials say that while assessments go up, an increase in taxes is not necessarily a given.
The town is only allowed to raise as much money as is allotted in its annual budget.
"People have to realize if you have a pizza pie, if you slice it into eight or 16 slices, it's still a pizza pie," said Ralph Fuccillo, chairman of the Board of Assessment Review, an independent appointed board. "If overall, assessment goes up, the tax rate will go down in order to raise that same amount of money."
Although the assessment is, in some cases, up as much as 70% over last year, the town tax rate for 2006-07 has actually decreased to reflect the rise in appraised value.
Many believe their reassessments were inflated and not reflective of market value rates.
"How they arrived at these percentages heaven only knows," said one Water Mill resident who owns developed property and one vacant lot, each of which increased by 36.6% and 70.59%, respectively, from the last town update in 2004. He wished to remain anonymous for fear of retaliation. "These reassessments bear no resemblance to anything like the cost of living index or interest rates; they're just arbitrarily slapped on."
However, real estate experts all agree that the value of most town-wide properties have rocketed in the past two years.
But according to officials the reassessment of residential and undeveloped properties accurately reflects the ballooning real estate market in recent years. Also, various influence factors accounted for any changes in value between neighboring homes — a power line might go over one property and not the other, for example. Commercial property was not updated this year.
Residents also complained of receiving tardy reassessment notices. The last batch was sent out on May 9, just one day before the town's informal day to grieve. Many did not receive the notices until May 11 — Councilman Steve Kenny among them. The town blames the delay on the private mailing service responsible for sending them out.
The reassessment broke the town into 60 "neighborhoods" — between eight and 10% of them were waiting for notices, Southampton Town Supervisor Patrick Heaney reported at the town board's work session last Friday.
"Where we fell short is, I think, in the side of communication," said Heaney, adding shortly thereafter, "As a result, there's been misinformation, fear and mistrust because that's what happens when you don't have the facts." Next year, the town intends to have all notices mailed out by March 1.
Heaney said one commonly held misconception was that taxes will increase automatically, "but in fact it's the exact opposite." The assessment equals market value of a home.
However, even if taxes go down this year, once the assessment is higher, each future increase will be commensurately higher.
According to New York State, the town was under-assessed at 70% of full market value. The drop by 30% or $15 billion under market value led to a loss of $250,000 in state aid to fund the town's assessment and office expenses.
In response, Southampton devised a six-year plan with state approval starting in 2004 to maintain values at 100%. The town agreed to conduct annual reviews and a complete site inspection of every property over the next five years. Inputting information from the 2004 reassessment prevented the town from updating the values last year. As a result, the town experienced a considerable reduction in its assessed market values due to the significant increase in sales of residential homes.
School budgets are a major source of annual property tax increases. Heaney said that having residents assessed at less than full value could have an adverse affect on state school aid, which would ultimately result in higher school taxes.
The town is "not just trying to raise taxes," said Heaney. "We're concerned deeply about fairness."
Shelter Island is the only other town on the East End conducting regular reassessments.
On Grievance Day in Southampton, residents were given a rough estimate of what their taxes might be as a result of the reassessment. The deadline to file a complaint application was yesterday, but those who filed have until May 31 to provide supporting documentation.
"The burden of proof is on the taxpayers," said Fuccillo. "If they make a good case, it gets lowered."