Property tax news unlikely to be happy for South Floridians - August 20, 2010

Expect deflated property values, rising tax rates and thousands of residents looking to challenge their home's official appraisal as property tax notices land in mailboxes this month.


By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Home values are still looking for a bottom, and county appraisers are still trying to get to the bottom of last year's giant pile of property assessment appeals, so it's expected to be a long property tax season in South Florida.

More than 1.75 million local homeowners should receive their 2010 property tax notices in the mail by the end of the month and, if the last two years are any indication, at least one in 10 will disagree with the number they see on the line next to the words "assessed value."

Broward County started sending tax notices on Friday and Miami-Dade letters will be sent out on Aug. 24.

Falling for the third straight year, property values in Miami-Dade County have decreased an additional 13.4 percent, or $29 billion, since last year, according to the property appraiser.

"This is the biggest drop we have seen in value in Dade County in I'm not sure how long -- definitely more than 35 years," said Miami-Dade Property Appraiser Pedro Garcia.

With foreclosures and short sales dragging down the market, some homeowners will see the silver lining of a battered market in a lower tax assessment, but many will be surprised that their tax bills haven't fallen as quickly as their home values.

Part of the reason is that governments have hiked the amounts of tax charged per each $1,000 in property value to make up for huge budget holes that have plagued cities, counties and special taxing districts during the economic downturn.

In Miami-Dade County, where commissioners are staring at a revenue hole of more than $400 million, the preliminary tax rate was upped 12 percent in July. That rate set a ceiling for how high the actual number -- to be determined by Oct. 1 -- can be. In Broward, were home values dropped 11.7 percent last year, the county commission is also weighing increases. School boards and many municipalities have indicated they would push up their rates as well.

For some homeowners, an unfortunate side effect of the 1992 Save Our Homes law could cause their tax assessments to increase even as their property values fall. Buyers who purchased before the boom benefited from an SOH clause that capped assessment increases at 3 percent a year, even as property values soared all around them. But that same law says yearly assessments must continue to increase until they are equal to market value, meaning many pre-bubble buyers will face increases until their assessed values catch up to the market.

Add increased rates with the Save Our Homes provision and many long-homesteaded property owners can expect a larger tax bill this year, despite the economic downturn that has sent wages and home values in a downward direction.

Marcos Sendon, who has owned his home in Kendall for more than 10 years, said he feels like he's being penalized for being a responsible homeowner, not involved in the subprime mortgage debacle or foreclosure crisis of the last five years.

"If you've played it straight and played by the rules, now you're going to be punished for that," he said, criticizing the county government for increasing the tax rate. "We think that's outrageous."

Sendon, editor of a conservative blog, is organizing a tea party rally to protest the local government's property tax rate increases. Public hearings in September will likely feature some level of public backlash, as city and county officials in Miami-Dade and Broward settle on tax rates and hash out budgets.

Thousands more may protest what appraisers have said their homes are worth.

If you're in that position, you'll have 25 days to file an appeal with the county property appraiser's office, for $15, and then wait patiently to be called. In Miami-Dade County, appeals to 2008 appraisals were so abundant that it took until April 2010 to finish reviewing petitions. The county's value adjustment board only recently began 2009's pile of 140,000 petitions, and despite opening up extra rooms to accommodate more hearings, the coming deluge of 2010 appeals probably won't be handled until next year.

If your appeal is rejected and you haven't paid your bill, you will be responsible for any penalties and fines that may have accrued during the appeals process.

M.J. Stone, a property tax consultant in Fort Lauderdale, said she expects this year to be as busy as ever with assessment appeals.

"With the Internet now, it's pretty easy for people to file on their own," she said. "I always tell people nobody knows their property better than the property owner. If they feel that their [assessment] is too high, this is the way to challenge that."

Broward County officials are encouraging those who dispute assessments to come in and speak with a county appraiser about their property before filing a petition, said Bob Wolfe, a spokesman for the property appraiser's office. That office is opening for extra hours on weekdays between Sept. 7 and Sept. 20, and on two Saturdays during the appeal season.

In Miami-Dade, the property appraiser has doubled the number of offices and hired additional staff this year to deal with the expected flood of appeals. The value adjustment board, which is tasked with hearing the appeals, is also hoping more people will choose to file online, and cut down the long lines that form in the last days before the Sept 20 application deadline.

One of the things to keep in mind is that 2010 property assessments reflect property values as of Jan. 1 and real estate activity from 2009. Most reports show local home values have fallen further in 2010 -- but those declines won't be reflected on your tax bill until next year.

Another point property appraisers are pushing: If you're unhappy about the tax rate set by your local government, the value adjustment board cannot help you.

Petitions to the property appraiser are only for those who believe their homes have been overvalued, Garcia said.

With home values diving as much as 31 percent year-over-year in places like Homestead, and with more and more residents struggling to pay the bills, the rush to appeal property tax charges is likely to be as high as ever.

"Our office, we're geared up," Wolfe said.

"Most of us have gone through this many times. It's all hands on deck, everybody answers the phone, everybody helps."



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