HomeMy WebLinkAboutSeptember_21_4pm_ Minutes_2010IREDELL COUNTY BOARD OF COMMISSIONERS
MINUTES
SEPTEMBER 21, 2010 (4:00 P.M. MEETING)
The Iredell County Board of Commissioners met for a briefing session on
September 21, 2010, at 4:00 P.M., in the Iredell County Government Center (South
Wing Conference Room), 200 South Center Street, Statesville, NC. The meeting was a
continuation of the September 7 meeting, and it was held for the purpose of allowing the
tax department staff to brief the board about the proposed 2011 revaluation.
Board Members Present
Chairman Marvin Norman
Vice Chairman Steve Johnson
Frank Mitchell
Absent: Scott Keadle and Ken Robertson
Staff present: County Manager Joel Mashburn, Deputy County Manager Tracy
Jackson, Assistant County Manager Ron Smith, County Attorney Bill Pope, Tax
Collector Bill Furches, Assistant Tax Assessor (Real Property) Steve Ervin, Property
Sales Analyst and Data Coordinator Chip Parks, Property Tax Appraiser Kathy Hoover,
Solid Waste Director David Lambert, and Clerk to the Board Jean Moore.
Media present: Jim McNally with the Statesville Record & Landmark
Others in Attendance: Ron McCarthy, a commercial property tax consultant and
President of RS& M Appraisal Services, along with Renee Griffith, a 2010 county
commissioner candidate.
Overview of the Proposed 2011 Revaluation: Assistant Tax Assessor Steve
Ervin provided a presentation about the 2011 reappraisal, and some of the information is
as follows:
•A reval could not be accomplished without a schedule of values.
•A manual used by the employees, helps to provide consistency, and a copy is
available for the public to review.
-Each reval stands on its own. A new schedule, or basis, is done for each reval.
Present Use Value
-Definitions and a description of the rules that must be followed to determine
present use values are in Chapter 13 of the manual. A use value committee develops a
manual each year, and this helps counties to establish values for agricultural,
horticultural, and forestry use.
Chapter 14 of the manual contains the present use value schedules on the income
or rent for agricultural land, horticultural land, and forestland. A handout was distributed
that showed the value differences for the past seven years. It is as follows:
Present Use Value Assessment —
Schedule of Values Cocaparison
Classification
2011
2007
2003
Agricultural
$590
$480
$448
Forest
$300
$230
$339
Horticulture
$810
$580
$546
Waste
$ 40
$ 40
$ 55
Ervin said the rent on agricultural land was increasing due to scarcity. He said
forestry varied and no explanation was known. Ervin said property owners were
encouraged to discuss the division of land before this actually occurred due to the use
value requirements. He said the forestry management program was optional; however,
all participants had to have a plan. Ervin said currently there were 90 forestry plans that
would be created by the county forester.
Commissioner Johnson asked if the income for forestland was based on an
average period of time.
Ervin said it was based on individual plans -- the trees, the age, the stand, and it
could be flexible. He said it had to be evident in the plan that the property owner was in
the program to produce an income.
Commissioner Mitchell asked if the tax department verified the income for farm
use on agricultural land.
Ervin said it was production, not really income. He said the amount, for example,
hay or soy beans, was verified.
Market Value
Ervin said the primary purpose of any reval was to equalize the tax base. He said
the main classes of property that the tax department worked on were real, personal,
business, and public service. Ervin said real property was appraised every four years
while personal property was re -appraised every year. He said real property values would
be frozen for the next four years, and as the county moved away from the reval year, the
shift of carrying more of the financial load went to personal property. Ervin said the
market value schedule was a guide, which included definitions, as well as factors and
formulas that were applied to the computer assisted mass appraisal system (CAMA). He
said the schedule would be different throughout other counties in the state. Ervin said
market value was defined by the Machinery Act of North Carolina under G.S. 105.283
Uniform Appraisal Standards as, "The price estimated in terms of money at which the
property would change hands between a willing and financially able buyer and a willing
seller, neither being under any compulsion to buy or to sell and both having reasonable
knowledge of all the uses to which the property is adapted and for which it is capable of
being used." He said this definition was broad, and it didn't include the properties being
sold under duress. Ervin said one section included the following statement:
"Neighborhoods in Iredell County will be analyzed to determine if there are excessive
foreclosures. If, based on appraiser judgment, it is determined that foreclosures are
having a negative impact on sales prices in the neighborhood, a market adjustment may
be made to reflect this negative impact."
Residential Properties
Property Sales Analyst and Data Coordinator Chip Parks said the market and sales
approach was used in appraising residential property. He said that for 2009, information
was limited but there had been 240 qualified "arms length" sales for single family
dwellings while in prior years the total was substantially higher. He said average length
of time for a house to remain on the market was 120 days, and in 2006 and 2007, it was
around 92 days. Parks said the current average sales price was $146,000 which was
down, and the average sales price per foot was $75. Continuing, he said the average list
price to sales price ratio was 93% while it was previously 97%, and this indicated that
sellers were not receiving their asking price. He said, however, the statistics could be
deceiving because larger homes were not being built, and they were actually about 200
square feet smaller. Parks said there had been 400 single family home foreclosures this
year compared to 471 last year. He said that on vacant residential foreclosures there had
been 350 this year while there were 270 last year. Parks said on nonresidential
foreclosures for vacant and improved structures there has been 28 this year (so far)
compared to 14 last year. He said items to be considered or compared when addressing
neighborhoods with a high percentage of after foreclosure sales were (1) sales ratios of
each type (arms length and OREO) (2) list prices (3) days on the market and (4) the
property's condition. Parks said some neighborhoods had more bank related sales than
arms length sales. Similarly to Ervin's comments, Parks said the primary reason for a
reappraisal was to achieve equity. He listed the following items that were used to
measure uniformity and equity among the classes of property:
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•Median sales ratio (assessed value/sales price)
*Coefficient of Dispersion (COD)
- The average percent deviation from the median ratio
•Price Related Differential
- This statistic shows the equity of the tax burden between low and high -valued
properties.
Parks said it had been discovered that the upper end residential values had
declined, but they were not much different from the 2007 reappraisal. He said this meant
the tax department was low during the last reappraisal.
Commissioner Johnson asked about the methodology used to appraise the
neighborhoods with foreclosures.
Parks said the sales would probably be adjusted and used in the ratio study. He
said the adjustments would occur for the market time typical for a similar neighborhood.
Commissioner Johnson mentioned concerns about homeowners, especially the
ones working three jobs, who were suffering through the economy and trying to hold on
to their homes. Johnson said it would not be fair to the homeowners "sticking it out" to
compare their properties to the ones in foreclosure, or to drive their values down too low.
Commissioners Mitchell said he knew from experience this could be unfair. He
said an individual purchased a home from him, and the lending institution used the values
on two foreclosed homes that were previously sold in the neighborhood.
Parks said that using foreclosures as a primary sale was not recommended. He
said that he did not agree with the lenders in this type of sale. Parks said a lengthy sheet
of information had to be completed when appraising foreclosures.
Commissioner Johnson said he felt the banks were looking for any reason to not
loan money.
Ervin then briefly reviewed Chapter 8 of the manual pertaining to income
property valuation (commercial, industrial & multi -family). He said income expense
questionnaires were sent to all income property owners and the information was analyzed
by property class. Ervin said the averages and ranges were reviewed and cap rates were
developed. He said Chapter 11 guided the appraisers in determining a final value.
Continuing, he said page 11-29 showed the base rate (sq. footage) for structures and
dwellings. Ervin said the CAMA system operated off of replacement cost plus
depreciation, then, if needed, market was applied. He said that basically, depreciation on
a house in a year's time was one percent which would be four percent since the last reval.
Ervin said it appeared that building costs were flat when reviewing information from the
last revaluation. He said the next step in the process would be to adopt the schedules, and
this was planned for the October 5 agenda. Ervin said the taxpayers had 30 days to
appeal the schedules.
Commissioner Johnson said the biggest complaint he received from the citizens
was over motor vehicles. He said the amount might not be $7 or $8; however, it was hard
to argue with an individual who had a year old Buick La Sabre with a sticker price of
$36,000 while $33,000 was paid for it, and the tax office had it assessed for $37,000.
Johnson asked if there were various methods to appraise the vehicles.
Ervin said the key was equity, and this was dictated by whatever system being
used. He said it was looking across the board at what price the vehicles were being sold.
Ervin said there were several different systems.
Furches said the county used the "middle of the road" for the value, and a
statewide service was used for the amounts. He said the taxpayer had 30 days to appeal
for various reasons such as high mileage, or a wrecked vehicle.
Johnson said many times the vehicles were brand new.
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Parks then demonstrated mobile office software that uses GPS technology to
assist the appraisers in reviewing the county parcels.
End of Reval Presentation ----------------------------------
CLOSED SESSION: OTIO by Commissioner Mitchell to enter into closed
session at 5:30 p.m., pursuant to Economic Development— G.S. 143-318.11 (a) (4).
VOTING: Ayes -3; Nays -0.
(RETURN TO OPEN SESSION AT 6:10 P.M.)
CALL FOR A PUBLIC HEARING REGARDING AN ECONOMIC
DEVELOPMENT INCENTIVE PROJECT: MOTION by Commissioner Johnson to
call for a public hearing on Tuesday, October 5, 2010 at 7:00 P.M., regarding an
economic development incentive of $126,675.00, over a five-year period, for an
undisclosed company based on a $7,750,000 investment in Iredell County.
VOTING: Ayes — 3; Nays — 0.
MODIFICATION OF THE KOOKS CUSTOM HEADERS ECONOMIC
DEVELOPMENT INCENTIVE AGREEMENT: OTION by Commissioner
Johnson to modify the original agreement with Kooks Custom Headers to reflect an
incentive based upon an initial investment of $4,586,464.00.
VOTING: Ayes — 3; Nays — 0.
ADJOURNMENT: There being no further business to conduct, the meeting
adjourned at 6:15 p.m.
Approval:
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Clerk to the Board