Unfair Assessing Practices - A disparity between sold and unsold homes

In the process of maintaining accurate data on property record cards (PRC’s) in-between city-wide updates or a revaluation, assessors are allowed to make annual adjustments to properties that have undergone improvements or have sold. This is required to maintain reasonable proportionality among properties.

 What is involved in capturing permits?

Assessor are required to capture all improvement through permits annually. In a big city, with too few assessors, adhering to this practice is nearly impossible. In an ideal operation, all home improvements would be captured by April 1 and valued on the July tax bill.

 What about sold properties?

Assessor are allowed to use the MLS pictures to make changes to the data on the PRC. The number of bathrooms, finished basements and attics, and upgrades to kitchens and baths are corrected and a new assessment is created. Assessments should go up and down based on these pictures. Some sold properties that have done few improvements are over assessed and need to be corrected as well.

 Are properties being corrected fairly in Nashua?

It appears they are not. Permits are not being captured on an annual basis with some permits staying open for 3, 5 or 10 years without any assessor visits to the property to verify completion. Some permits are being closed without a visit from an assessors and improvements are “calculated” from the desk.

Nashua has no quality control mechanism to run monthly reports to clearly track open and closed permits to monitor the Assessor’s work. The Board of Assessor’s does not receive such a report and the public is simply told the work is getting done, without the ability to verify the City’s claims.

Reports obtained by the Department of Revenue show that permit capture has been a problem in Nashua over the years. Another question that arises is value placed on permit work by the Nashua Assessor. How is this determined?

For sold properties, assessors are raising the assessment more aggressively than on properties with home improvements through permit work. The assessor cannot use the sale price to set the assessment but must simply make corrections based on the sales pictures. It seems, at times, that the assessors are cheating a bit and “looking at the answer (the sale price) and then adjusting the assessment. This is an illegal act called sales chasing, see prior post, What is Sales Chasing?”

Some sold properties are increase more than $100,000 while increases for permits are much lower. This has created significant disproportionality. The City is not willing to own the problem and appears to have no tracking of the quality control aspects of assessing to be sure this is not happening. The City is working with a hired state consultant to develop software apparently for quality control. No details on this have been shared with the public; it is unknown what the end product will be.

The bigger problem is how the assessors are handling the subjective factors to correct PRC’s. These factors, which include depreciation, the grade and condition of the property require the judgement of the assessor to set the level. Uniform standards for this have been absent from the office for years. Assessors appear to be operating independently instead of training as a team to ensure uniformity and there has been no management oversight to verify these judgement calls.

 In culling through thousands of PRC’s, Assessors are rarely correcting these factors on permit improvements but are using these factors aggressively for correcting some sold properties. This is an unfair process.

 The City relies on the Department of Revenue five year review of assessment practices for checks and balances. In 2015, the DRA granted a passing grade, albeit a strong grade, for the assessing office. In in city of 29,000 parcels, a sample of 35 PRC covering a multitude of property characteristics is consider statistically acceptable in determining property uniformity.

The City got an “A” the last time the DRA came in. We should be wondering how we got into a heap of a mess if the assessing office appears to have been running like a fine tuned engine. Clearly, local public oversight is important.