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New property values finalized despite concerns

City announces new tax rate, lowers interest rate for late payments
By Stephen Betts | Sep 16, 2020
The Rockland City Council met Wednesday, Sept. 16.

Rockland — The city's revaluation will be put into place despite concerns by many property owners and some councilors over the impact of sharply increased assessments for some neighborhoods.

The Rockland City Council held an online meeting Sept. 16 with a representative of KRT Appraisal, an attorney with the city's contracted law firm, and Assessor Roxy LaFrance, who is leaving to take another job. She was hired as assessor in 2017 after a year-and-a-half as a clerk for the assessment and code offices.

Attorney Kevin Decker told councilors they can advise the assessor, but legal authority to set values is with the assessor.

City Manager Tom Luttrell said the city needs to finalize the tax commitment and send out bills. Normally, the commitment and mailing of property tax bills is done in August with the first half payment due by the end of September.

The first half of taxes this year will be due Nov. 6 and the second half March 5. Councilors voted unanimously to set interest on late payments at 2% rather than the maximum 8% that it could have charged. Municipalities generally set the rate at the maximum allowed by the state.

Councilor Valli Geiger voiced support for the reduction, saying other interest rates are at historical lows. City Manager Tom Luttrell pointed out the city will be borrowing money at 3 to 3.5% interest in anticipation of receiving taxes.

But other than the lower interest rate on low payments, there was no relief for the property owners who are facing the sharpest increases.

Councilor Nate Davis suggested implementing the new values incrementally over more than one year to lessen the impact.

"This is a human dilemma. There are some extreme losers (in the revaluation process). This will hurt some people quite harshly," Davis said.

Geiger said while they may be losers in terms of paying more taxes, they will have homes worth far more and could sell for much more or could borrow more money using them as assets.

Davis said, however, they would be losers in the process if those homeowners want to remain in their homes.

Rob Tozier, vice president of KRT, detailed the process to councilors and presented statistics on the changes in valuations.

Changes were due, in large part, to sales for the previous two years. For example, there were 15 sales in the South End with the average price increasing 45% compared to the old values. There were seven sales in the North End with values dropping 14% compared to the old values.

The median price of a single family in Rockland jumped from $145,000 in the last revaluation in 2005 to $187,100 in 2020.

LaFrance announced that the new tax rate will be $22.30 per $1,000 of valuation. That is down 10% from $24.76 last year.

Property owners whose valuations went up 10% will see no change in their taxes. Property owner whose valuations went up less than 10% or saw a decrease in values will pay less in taxes.

But those who saw their values increase more than 10% will experience a tax hike.

One of the neighborhoods that saw the sharpest increases was Mechanic Street.

For example, one home on that street saw their valuation skyrocket 68% from $203,900 to $342,900. The tax bill on that home will increase 55% ($2,536) from $4,553 to $7,089.

This year, both the City Council and Regional School Unit 13 Board approved budgets that will require slightly less property taxes for property owners. Knox County's budget resulted in Rockland paying slightly more for county services.

But the revaluation shifts the distribution of taxes within the community.

The attorney pointed out that delaying the revaluation would be kicking the can down the road, and could face challenges from property owners whose valuations are declining but would not receive the benefit if the revaluation was not implemented.

The city manager said homeowners who still feel their values are not correct can seek an abatement from the assessor. They can then appeal that decision to the board of assessment review.

The city manager said without the revaluation, the city's overall assessment would fall below 90% of real value and homeowners would see a reduction, for example, in the homestead exemption. That deducts $25,000 from the valuations of people's primary homes.

Rockland is projecting to send out bills totaling $19.1 million for 2020-2021. Of this amount, $10.6 million (56%) will go to the school district. Another $7.3 million (39%) goes for municipal services. $1.1 (5%) will go to Knox County.

RSU 13 officials have repeatedly pointed out that if the state education formula factored in a community's median income, the district would receive millions more in aid, thus reducing the property tax rate in communities including Rockland.

For every $771,000 in additional aid, the property tax rate would drop $1 per $1,000 of assessed valuation.

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Comments (11)
Posted by: Avis Turner | Sep 28, 2020 16:50

So much to learn. I have been researching & asking questions. Would welcome working on a citizen committee to look into better solutions.... because, 1) this tax method seems to encourage people not to fix up their homes & neighborhoods?  2) Researching, I found that many places have laws- valuations must be done every five (or so) years. So, why / how did Rockland wait (ethically / fiduciary responsibility) fifteen years? This lag time, seems very detrimental on many levels; not good policy for anyone.  After waiting 15 years- there are viable questions concerning the procedures and formulas used. (I had a long conversation with KRT) Why use only the last two years of  home sales?  and not say, the middle seven? Or an average of the entire fifteen years? Plus, "drive-by" is not an accurate valuation assessment (we all know this). One of many reasons- it encourages people to do work without permits or using licensed professionals. More to learn about the process used by KRT.  3) As solutions: Can Rockland a) create a form of  stepped tax "rent control" to protect those people who have lived here for long time (they have pd their dues when Rockland wasn't so fancy. b) tax policy for those people (new or long term) who have limited incomes or are retired, c) tax on an income curve, d) find other ways to create tax revenue- which can concurrently promote and support diversity, young workers and young families?  4) Back to tax law- to promote safe & beautiful living structures, could Rockland implement amortize system, so that vital repairs and energy saving renovations can be encouraged. I believe  we can create a generative system/ community,  rather than continue to use the tax formula based in an outdated  regressive system....  Forming a "beloved community " (Dr. Martin Luther King).  And last, this quote I found, "Whenever tax rates penalize thrift or discourage investment, they must be lowered. Where ever current provisions of code are disincentives for economic growth, they must be changed." (RNC platform/ not sure which yr.) .   Respectfully submitted



Posted by: Stephen Betts | Sep 17, 2020 12:28

Kendall, you need to put the comments in perspective. She wasn't calling Mechanic Street residents losers. She was responding to another councilor's comments that they were losers in the revaluation process.



Posted by: Francis Mazzeo, Jr. | Sep 17, 2020 12:16

Seems it is always about money. Years ago residents sold out and moved to the outlying towns. Now those places have bigger schools and higher tax bills yet Rockland is still the highest. I'd hate to be trying to raise a family in these times. Property isn't worth more, money is worth less. People want money from the government to make up for loss of income or whatever but it is placing our youth in insurmountable debt. Not to mention we are destroying the planet we live on with our self-centeredness.



Posted by: Kendall Merriam | Sep 17, 2020 11:33

Stunning how Geiger, an elected official, calls Mechanic Street property owners who have been overwhelmed with huge revaluations "losers."



Posted by: Crawford L Robinson | Sep 17, 2020 09:49

"Get used to it folks. Just get used to it. We do it all the time"... Two things are certain: Death and taxes. If they aren't dying fast enough you tax them to death.



Posted by: Stephen K Carroll | Sep 17, 2020 08:09

Steve I am certain that the City will come up with an answer on why they are sticking it to us again.  They will either "dazzle you with Brilliance, or baffle you with bullsh".  Just bring out your checkbooks out.



Posted by: Valerie Wass | Sep 17, 2020 07:28

Do tax payers have to fill out the abatement form to get the $25,000.00 abatement or will it be on our tax bill automatically?



Posted by: Stephen Betts | Sep 17, 2020 07:22

The commercial values are posted on the KRT website and will be on the city website. I am waiting for an answer on why the rate only dropped 10 percent if overall valuations increased nearly 16 percent with no change in the net budgets.



Posted by: Francis Tax | Sep 17, 2020 07:17

Meanwhile some of us have been paying more than our fair share since the last revaluation years ago. Sales prices in our area have run 25% below assessed values!



Posted by: Mary Susan Hurst | Sep 17, 2020 07:11

For months we've been told the new tax rate would be under $21 per $1000 and that those with valuations increasing 16% or less would see no increase or a reduction in taxes. Suddenly, the new tax rate is $22.30. Only valuations increasing less than 10% will result in reduced taxes. Why did the tax rate increase from the projected increase? What changed? Will the valuations for commercial/business properties be posted on the City website?



Posted by: Stephen K Carroll | Sep 16, 2020 21:15

So tell me what is wrong with "kicking the can down the road" ?  Hell Federal, State & Local governments have been doing it for years.  You can kick it for another 10 years as far as I'm concerned.  On one hand they talk about raising the Minimum wage to help struggling workers than on the other steal money from your pocket to help the tax man.  I would like to see a council that has the best interest of the taxpayer at heart.  They sold us out again.  Surprise surprise.



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