Chuck Cobb: Moffat County residential property values are going up
Over the course of the last couple of months I wrote a series of articles in the Craig Press about the residential value process and our pending 2019 reappraisal.
In those articles I had mentioned that we were expecting to see a fairly sharp rise in residential values for Moffat County in 2019.
Now that I have made you aware of the fact that actual values for residential properties are on the rise let’s take a quick look at the expected changes in your “assessed value” — or better known as your “taxable value.”
To reach your taxable value you simply multiply your actual value by the current assessment rate. For the past two years the Residential Assessment Rate (RAR) has been set at 7.2% and we may again see this rate lowered again for this appraisal cycle. A rate of 7.15% is being suggested by the Department of Property Taxation per their two year study, but it appears the Governor is pushing for it to remain the same. A similar reduction in the RAR took place in 2017 when the State Legislature lowered it from 7.96% to 7.2%. Bi-annual adjustments of the RAR are driven by the 1982 Gallagher Amendment which was in-acted to keep a balance between residential and non-residential value within the State during very active real estate markets. Unlike what we saw in 2017 where the RAR dropped more percentage points than the percentage increase in property values which ended up with a net decrease in taxable value, this year’s drop, if any, will only have a slight effect on your overall assessed value.
On or before May 1, all owners of real property will receive a “Notice of Value” (NOV) from the assessor. This NOV will reflect your previous year’s value and your new value for 2019 and 2020. As mentioned above, these value changes are primarily being driven by the sale prices of similar properties during our collection period. Additionally, your change in value could also be attributed to the fact that you have made some improvements to your property since our last re-appraisal in 2017. Improvements such as a new addition — you finished your basement or maybe you added a garage?
For some, these improvements may have occurred many years ago but were only discovered recently. Regrettably, this is a normal occurrence due to the fact that not all new construction or remodels require building permits within our county.
So any new improvements that were discovered will have an effect on your value to, if made prior to Jan. 1 of this year. During the month of May taxpayers do have the right to protest their new values and those protests must be filed with the assessor on or before June 1.
Now that you know residential values are on the rise and before you go into a panic thinking your property taxes are automatically going to skyrocket, let’s take a closer look at where our residential values/taxes have been and where we are at today. Yes, I would expect that most all residential property owners will see increases in their residential property tax for 2020. Your final tax liability for next year will depend on where the final Residential Assessment Rate is set and at what level the mill levy’s will be set at in December 2019 by our taxing entities. Your final tax liability will be your assessed value multiplied by the new levy.
So, in an attempt to put this value increase into perspective I am providing you a 10-year history for an actual residential property located in the Riverview Subdivision. Remember, 10 years ago we saw the Great Recession hit in 2009. Prior to 2009, residential property values were on the rise and they eventually peaked in Moffat County during the 2009 or the 2011 reappraisal cycle. During the 2013 or the 2015 re-appraisal cycle’s residential property values in Moffat County fell off substantially and then in 2017 values started to stabilize and began rising back up.
On this chart you can see in 2017 the RAR dropped from 7.96 to 7.2%. This reduction resulted in a drop in the assessed value even though the actual value of the property went up $1,406. Now for 2019, you can see the actual value is increasing $17,013. The actual taxable value will depend on whether or not the RAR decreases or stays at the current rate. Based on the RAR staying the same, this property owner should see roughly a $74 increase in tax for next year. Interesting to note, even with this increase it is still $89 less than what it was paid in 2009. Obviously this illustration will not be the same for every property owner but similar patterns are being seen across the county for a majority of residential property owners.
I fully understand that not everyone will be satisfied with their new values but I am hopeful that the information I have provided will help you better understand the valuation process and valuation history. Please feel free to visit our website and the Property Ownership Database. There you can find some valuable information about your property and sales history for your neighborhood.
Chuck Cobb is the assessor for Moffat County.