Real Estate Assessments Division

Transcription

1 Prince William County, Virginia

2 Finance Department Real Estate Assessments Division Prince William County, Virginia BOARD OF COUNTY SUPERVISORS Sean T. Connaughton Chairman at-large L. Ben Thompson Brentsville District Mary K. Hill Coles District Maureen S. Caddigan Dumfries District Edgar S. Wilbourn, III Gainesville District Vice Chariman John D. Jenkins Neabsco District Ruth T. Griggs Occoquan District Hilda M. Barg Woodbridge District COUNTY EXECUTIVE Craig S. Gerhart

3 Finance Department Real Estate Assessments Division Organization Chart as of July 1, 2001 Director of Finance Christopher E. Martino, CPA Assistant Director of Finance Steve Ferlotti Real Estate Assessments Division Chief Vacant (Allison Lindner, Acting) Secretary Diane Honeycutt Assessments Coordinator Vacant Assessment Support Supervisor Allison Lindner Appraiser II Supervising Kimberly A. Lorenz, RES Appraiser II Supervising John E. Malone, RES Appraiser II Supervising Kerem Oner, CAE Appraiser II Supervising Vacant GIS Analyst Debra Watson-Grady Financial Systems Analyst I (OIT) Janet Barrett Appraiser I Ken Baxter Appraiser I Mildred Norris Appraiser I Clayton Loushay Appraiser I Charlie Tolbert Account Clerk II Delories Goodman Account Clerk III Pam Morehead Appraiser Trainee Lisa Manning Appraiser Trainee Bridget Affeldt Appraiser Trainee Susan Spicer Appraiser Trainee Victor Molina Account Clerk II Theresa Harris Title Clerk Elizabeth Rector Appraiser Trainee Michael Shannon Appraiser Trainee Mick Majdi Appraiser Trainee Alvaro Delgado Appraiser Trainee Petra Svenhager Data Entry Clerk Barbara Hill Title Clerk LaPointe Crismond Appraiser Trainee Linda Morey Appraiser Trainee Lenny Kim Appraiser I Wesley Riggins

4 TABLE OF CONTENTS INTRODUCTION...1 FUNCTIONS OF THE REAL ESTATE ASSESSMENTS OFFICE...2 MAINTAINING PROPERTY RECORDS...2 REASSESSING EXISTING PROPERTIES...3 Collection of Data...4 Analysis of Data...5 Application of Results...5 Performance Measurement...6 ASSESSING NEW CONSTRUCTION...7 FACILITATING ASSESSMENT NOTIFICATION AND APPEAL...8 Assessment Notification...8 Appeal Procedures...9 Appeal Adjustments...9 ADMINISTERING REAL ESTATE TAX RELIEF PROGRAMS...10 Tax Relief for the Elderly and Disabled...10 Tax Relief Based on Use Value Assessment...12 Partial Tax Exemption for Rehabilitated Real Estate...13 PROVIDING CUSTOMER SERVICE...14 Walk-in Customers...14 Telephone Requests From Real Estate Professionals...14 Telephone Requests From Citizens and Public Agencies...14 Internet Access...15 REAL ESTATE VALUES...16 LANDBOOK VALUES: GROWTH AND APPRECIATION...17 RESIDENTIAL...18 APARTMENTS...21 COMMERCIAL AND INDUSTRIAL...22 Locally-Valued Properties...22 State-Valued Public Service Properties...22 UNDEVELOPED LAND...24 SUPPLEMENTAL ASSESSMENTS...25 TAX-EXEMPT PROPERTIES...26 STATISTICAL APPENDIX...A-1 TABLE 1: HISTORY OF PROPERTY RECORD MAINTENANCE ACTIVITY...A-3 TABLE 2: HISTORY OF TAX RELIEF FOR THE ELDERLY AND DISABLED...A-3 TABLE 3: HISTORY OF APPEALS ACTIVITY...A-3 TABLE 4: HISTORY OF ADJUSTMENTS...A-3 TABLE 5: USE VALUE ASSESSMENT SUMMARY...A-4 TABLE 6: AVERAGE ASSESSED VALUE HISTORY OF RESIDENTIAL PROPERTY...A-5 TABLE 7: ASSESSED VALUES AND ESTIMATED MARKET VALUES...A-6 TABLE 8: HISTORY OF THE REAL ESTATE TAX BASE...A-8 TABLE 9: PUBLIC SERVICE AND COMMERCIAL/INDUSTRIAL ASSESSMENTS...A-9 TABLE 10: ASSESSMENT PERFORMANCE STATISTICS...A-10 TABLE 11A: GROWTH AND APPRECIATION...A-11 TABLE 11B: HISTORY OF APPRECIATION RATES...A-12 TABLE 11C: HISTORY OF GROWTH RATES...A-12 TABLE 12: TOP FIFTY REAL ESTATE TAXPAYERS FY A-13 TABLE 13: TAX RATES...A-14 ADDENDA...B-1 ADDENDUM A: SAMPLE NOTICE OF REASSESSMENT...B-3 ADDENDUM B: REHABILITATED REAL ESTATE PROGRAM...B-5 ADDENDUM C: TAX RELIEF PROGRAMS...B-7 i

5 ADDENDUM D: SAMPLE TAX BILL...B-9 ii

6 INTRODUCTION The Finance Department s Real Estate Assessments Office is responsible for annually assessing all real property in Prince William County, maintaining property ownership records, and administering the County s tax relief programs. In order to perform these duties accurately, the office gathers and maintains data on every property in the County. The assessments office also collects and analyzes data pertaining to real estate market indicators such as sales and property income and expense data. This information enables the office to assess property at fair market value and to develop summaries of the County s real estate for use in policy analysis. Assessments for 2001 were made effective on January 1, 2001, and were entered into the County s landbook, an annual listing of real estate assessments and taxes. Tax payments are divided into two equal installments. Payment for the first installment is due July 15 and payment for the second installment is due December 5. The County also makes supplemental assessments for newly constructed property completed during the year and for any properties in the Use Value Assessment Program (see page 12) that become eligible for a rollback tax. The County will collect taxes for 2001 supplements in December of 2001 and in February and May of Real estate assessments and taxes are based on the tax year, which coincides with the calendar year. The County accounts for the revenues from this tax during the following fiscal year (July-June). That is, real estate assessments and taxes for tax year 2000 form the basis for Fiscal Year 2001 County revenues. All FY2001 (tax year 2000) information is presented in this report. However, some tax year 2001 (FY2000) including supplemental assessments and rollback taxes, is not yet available and is estimated. Note: In the following discussion, all references to years are for tax (calendar) years rather than fiscal years unless otherwise noted. 1

7 FUNCTIONS OF THE REAL ESTATE ASSESSMENTS OFFICE The Real Estate Assessments Office performs the following key functions: Maintains property records Reassesses existing properties Assesses new construction Facilitates assessment notification and appeal Administers real estate tax relief programs Provides customer service Maintaining Property Records The assessments office is responsible for determining taxable ownership of property. This requires interpreting all legal documents relating to real estate. The documents (deeds, plats, wills, court orders, etc.) are recorded by the Clerk of Circuit Court and contain information regarding transfers, consolidations, subdivisions, and other legal changes. After reading each document, the assessments office determines whether it affects the taxable ownership, size, or configuration of the properties. If it does, the assessments office makes necessary changes to property records. In some cases, deeds conflict with County records. The assessments office coordinates with settlement attorneys and the Geographic Information Service section of the Office of Information Technology to clarify and correct the deeds. This process ensures up-to-date records with accurate legal descriptions. There are four types of documents and transactions handled by the assessments office: 1. Wills instruments recorded upon the death of an individual. They may or may not transfer real estate. 2. New Lots parcels that are created from a subdivision of existing land. 3. Deeds instruments recorded that may or may not transfer real estate. One deed may transfer no parcels or several hundred parcels. 4. Transfers legal changes in ownership of property. 2

8 As the following table shows, property maintenance activity increased from FY2000 to FY2001. A more detailed history of property record maintenance activity is shown in the Statistical Appendix, Table 1, page A-3. Property Record Maintenance Activity FY 1999 FY 2000 FY 2001 Wills New Lots 2,130 3,189 3,867 Deeds 12,120 12,941 16,100 Transfers 14,243 14,831 16,652 Comparison of Property Record Maintenance Activity Number of Occurences 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 FY 1999 FY 2000 FY 2001 Wills New Lots Deeds Transfers Reassessing Existing Properties State law requires all Virginia counties to reassess real estate at least every four years, with annual and biennial assessments authorized. Prince William County has performed annual assessments of property since l979, when computerization made this feasible. Tax policy publications recommend annual reassessment because assessments at longer intervals may result in large disparities and inequities between properties, especially during periods of rapid changes in the real estate market. 3

9 Regular reassessment helps maintain equity between properties as market conditions change. Maintaining equity is a primary goal in the assessment of real estate for tax purposes. The standard for all assessments in Virginia is established in the Virginia Constitution, which requires assessment at fair market value as of January 1 of each year. The only exception to this requirement is for certain agricultural, forestal, horticultural, and open space property in the Use Value Assessment Program (see page 12). To perform equitable assessments, the assessments office must gather accurate and consistent property information and perform proper analyses of sales and other market indicators. Collection of Data The assessments office collects information on property descriptions, sales, income, expenses, and other real estate market data. To ensure property descriptions are accurate, County assessors periodically inspect properties and verify current data. Property characteristics are relatively stable, and physical inspections of each property are not necessary every year. However, physical characteristics such as condition do change slowly over time, and properties are reviewed approximately every five years to ensure appraisals are based on accurate information. Income and sales data are the primary data sources for establishing the value of real estate. However, only a fraction of the total properties in the County sell each year. These sales are used as the basis for valuing most properties in the County. As a result, errors in sale data can affect many properties. Because inaccurate sales information can lead to incorrect conclusions about property values, sales must be reviewed to verify the physical and financial circumstances that led to a particular sale price. This review may include a physical inspection of the property to confirm its physical and economic characteristics. The review may also include contact with the buyer, seller, or other persons involved in the transaction to verify the presence and amount of unusual financial terms that may have affected the sale price. To aid in valuing commercial and industrial property using the income approach, the assessments office collects income and expense information from commercial property owners. 4

10 Analysis of Data The assessments office analyzes the information about market activity (sales, income, etc.) and values property based on the real estate market. Properties are reassessed each year. Therefore, each year the most recent sales, income information, and other market factors are studied and values are re-assessed according to the current real estate market. Application of Results Appraisers use several approaches to value property for assessment purposes. These approaches are discussed below. Cost Less Depreciation In the cost less depreciation approach, the value of the structure is estimated and added to the value of the land. The structure value is determined by first estimating the cost to replace the building with a new one, and then subtracting depreciation, which makes the existing building worth less than the cost of a new one. Depreciation can be caused by physical deterioration, functional obsolescence (poor functional design), or by economic obsolescence (effects of factors outside the property such as high traffic). Sales Comparison The sales comparison approach is based on comparing a property with similar properties that have sold. In this approach, several similar properties with recent sales are selected. Each of the sale prices is adjusted for differences between the property that sold and the subject property. This gives an indication of what each of the buyers would likely have paid for their property had it been identical to the subject property. Income Capitalization The income capitalization approach assumes that there is a relationship between the net operating income of a property and its value. In this approach, the effective gross income of a property is estimated by considering market rents, vacancy rates, and collection losses. Estimated normal operating expenses are deducted to generate an estimate of net operating income. This income is capitalized into an estimate of value by application of an appropriate market capitalization rate. 5

11 Statistical Estimation Statistical estimation methods are often considered part of the sales comparison approach because they utilize sales of property. In this approach, sales of property are utilized in statistical processes such as multiple regression and adaptive estimation to generate models of the real estate market. These models are extremely sensitive to the quality, quantity, and accuracy of available data. The assessments office uses statistical estimation where adequate data is not available to support other approaches to value. Performance Measurement The tool used to measure the accuracy of assessments is the assessment-to-sale ratio, which is calculated by dividing the assessment by the selling price. For example, a single family home assessed for $152,000 that sells for $160,000 has an assessment-to-sale ratio of 95%. This ratio is calculated for all valid sales in the County and is used to monitor the level and equity of assessments. The median assessment-to-sale ratio is called the level of assessment. The median (midpoint of arrayed ratios) is used so that extreme ratios affect it only minimally. For tax year 2000 sales, the median level of assessment is estimated to be 88.97%. The County s 2000 level of assessment is calculated by comparing January 1, 2000 assessed values to sales that occurred during calendar year Sale prices increased during the year due to the rising real estate market and inflation. Assessments, however, do not change during the year. On January 1, 2000, the assessments were closer to the sale prices than the level of assessment indicates. The median level of assessment, however, is the only performance statistic published by the State and is therefore provided as an indication of the accuracy of assessments. Equity of assessments is measured using average error. The average error is the average percentage each sale deviates from the level of assessment. A small average error indicates individual ratios are relatively close to the level of assessment. A large average error indicates ratios vary greatly. For tax year 2000 sales, the estimated average error is 7.48%. 6

12 The following table shows the assessment level and error for 1999 and A more detailed summary is in the Statistical Appendix, Table 10, page A-10. Assessment Performance Level Error Residential 92.71% 88.98% 6.65% 7.22% Apartments * * * * Commercial and Industrial 92.17% 87.87% 24.59% 26.83% Undeveloped Land * * * * Overall 93.04% 88.97% 7.06% 7.48% * Insufficient sales. Note: Performance data for 1999 is provided in the State Department of Taxation s Sales Ratio Study. The 2000 report from the State will be published in February of Performance data for 2000 are therefore estimated by the assessments office based on 2000 sales. For 2001, there is not enough information available to make an estimate. Assessing New Construction During the year, the Real Estate Assessments Office receives copies of building permits issued by the County for new structures, additions to buildings, and remodeling of buildings. The assessments office periodically checks the progress of activity indicated on the permits. New construction requires field inspections for accurate measurements and examination. The following tables show the number and estimated dollar amount of permits issued by the County in FY1999, FY2000, and FY2001. Number of Permits Issued for Structures and Additions Source: Department of Public Works Note: Only taxable properties are included in the counts above. FY 1999 FY 2000 FY 2001 New Residential 3,207 3,404 4,049 Residential Additions, etc. 3,789 4,241 4,718 New Non-Residential Non-Residential Additions, etc Total 7,530 8,106 9,312 7

13 Estimated Dollar Amount of Permits Issued for Structures and Additions FY 1999 FY 2000 FY 2001 New Residential $ 323,384,751 $ 381,428,291 $ 469,328,572 Residential Additions, etc. 22,724,777 28,931,585 33,698,391 New Non-Residential* 146,303,734 51,459, ,661,716 Non-Residential Additions, etc. 18,062,103 22,292,023 34,394,686 Total $ 510,475,365 $ 484,110,975 $ 672,083,365 Source: Department of Public Works Note: Only taxable properties are included in the amounts above. * The large increase in the estimated dollar amount of New Non-Residential Construction Permits for FY2001 was due to significant increases in office, industrial, and recreation space. History of Estimated Dollar Amount of Permits Issued Estimated Dollar Amount of Permits Issued $500,000,000 $450,000,000 $400,000,000 $350,000,000 $300,000,000 $250,000,000 $200,000,000 $150,000,000 $100,000,000 $50,000,000 $- FY 1999 FY 2000 FY 2001 New Residential Residential Additions, etc. New Non-Residential Non-Residential Additions, etc. Facilitating Assessment Notification and Appeal Assessment Notification Section of the Code of Virginia requires the County to notify property owners whenever reassessment results in an increase in assessed value. The County has chosen to notify all property owners of reassessment, even if there was a reduction or no change in the value. This notification takes place around March 1 of each year and advises the 8

14 taxpayer of the previous year s assessment and the current assessment. (See Addendum A, page B-3 for a sample notice of reassessment.) Appeal Procedures Taxpayers who are uncertain about the accuracy of their assessment on the basis of value or equity with other properties can request a review of their property value. The County appraiser considers market information relative to the property and information provided by the taxpayer. If this information shows the assessed value should be changed, the appraiser makes the necessary adjustment. If the evidence does not support a change, the appraiser explains the reasons for sustaining the assessment. Taxpayers may also appeal to the Board of Equalization (BOE) or Circuit Court. Taxpayers are not required to appeal to the assessments office before appealing to the BOE or Circuit Court. The BOE is comprised of eight County taxpayers and is established by the Board of County Supervisors to render an independent third party opinion in cases of disagreement between the taxpayer and the assessing official. Although the BOE is a quasijudicial board, there is no fee and an attorney is not required. Appeal Adjustments As a result of an appeal to the Real Estate Assessments Office, the BOE, or Circuit Court, an assessment may be revised. Developers may appeal many residential lots at the same time and each lot appealed is counted separately. Upon review, the assessments office may change any or all of the lot values. Since each lot is counted separately, the number of appeals and the number changed by the assessor may be large and may fluctuate substantially from year to year. Some properties are appealed to both the assessments office and to the BOE. In tax year 2000, one new case was appealed in Circuit Court. There was one lawsuit resolved as a result of a negotiated settlement outside of court. As of June 30, 2001, there are eleven court cases pending. 9

15 The table below shows appeal activity for tax year 1998 to tax year A history of appeals and the resulting adjustments can be found in Table 3 of the Statistical Appendix, page A-3. * May have been decreased or increased. Summary of Appeal Activity TY 1998 TY 1999 TY 2000 Appeals to Assessor Changed by Assessor % Changed* 78% 51% 83% Appeals to BOE Changed by BOE % Changed* 13% 40% 13% Appeals to Court Total Appeals Appeals as % of Total Parcels 0.74% 0.89% 0.76% Administering Real Estate Tax Relief Programs Prince William County provides relief from real estate taxes for those who are elderly or disabled and meet specified income and net worth requirements. Certain land uses may also qualify for tax relief to encourage preservation of agriculture, forestry, and open space. Lastly, older properties which undergo substantial renovations can receive relief of all or part of the increase in taxes caused by the renovation. Tax Relief for the Elderly and Disabled Elderly or disabled persons are eligible for relief from real estate taxes on their home and a home site of up to one acre if they meet the following criteria: Are over 65 years of age on or before December 31, or are totally and permanently disabled. Have less than $195,000 in total assets (residence and up to one acre excluded). Do not exceed the maximum combined income requirements set forth in local ordinances. 10

16 The assessments office provides information to taxpayers about the tax relief program in the following ways: The notice of reassessment is sent to all property owners in March and contains the criteria for tax relief and the deadline for filing (see Addendum A, page B-3). A tax relief brochure containing specific information regarding eligibility and application is available in the assessments office and various other County agencies (see Addendum C, page B-7), including Finance Department counters and senior citizens' centers. Tax relief information is available on the internet at The following table summarizes eligibility type (exemption or deferral) and the percentage deferral of 2001 taxes for different ranges of income. The Board of County Supervisors establishes the income ranges based on the Housing and Urban Development low income limit. For 2001, the limit is $40,150 and each range is determined using a percentage of that value Tax Relief Percent of HUD Combined Percentage of Low Income Limit Income Tax Relieved $0-$27,500 (base) $0-$27, % Exemption 66%-85% 27,501-34, % Deferred 85%-90% 34,129-36,135 75% Deferred 90%-95% 36,136-38,143 50% Deferred 95%-100% 38,144-40,150 25% Deferred Each applicant must file an application for tax relief with the Director of Finance at the Real Estate Assessments Office each year between January l and April 15. The County sends renewal applications to those who received tax relief the preceding year. Individuals who do not receive an application may request one by calling the Real Estate Assessments Office. 11

17 A summary of real estate tax relief for the elderly and disabled is shown in the following table. Additional historical information about real estate tax relief is provided in the Statistical Appendix, Table 2, page A-3. Summary of Tax Relief for the Elderly and Disabled* Real Estate Households Exempted Households Deferred** Total Number of Households Amount Exempted $ 1,010,781 $ 998,470 $ 1,176,134 Amount Deferred 254, , ,490 Total Amount Relieved $ 1,265,605 $ 1,295,762 $ 1,383,624 Average Amount Exempted $ 1,383 $ 1,402 $ 1,361 Average Amount Deferred $ 1,355 $ 1,457 $ 1,584 Personal Property Approved Personal Property Applicants 1,203 1,234 1,217 * Taxpayers may qualify for real estate tax relief, personal property, or both. ** Because of an increase in the income range for tax exemption, a number of persons who previously had their taxes deferred qualified for exemption in Tax Relief Based on Use Value Assessment The Prince William County Use Value Assessment Program provides tax relief to certain agricultural, forestal, horticultural, and open space property owners. The program allows qualifying land to be taxed according to its use value rather than its market value. The State Land Evaluation Advisory Committee suggests values for land in the program. These values range from $20 per acre to $330 per acre, depending on the type of land. The tax difference is deferred, but not automatically forgiven. The deferred tax remains payable for six years. When property owners of land in the Use Value Assessment Program either change the use to a non-qualifying use or re-zone their property to a more intensive zoning, they must pay taxes (including interest) on the difference between the property s market value and its use value for the current year and the five most recent complete tax years. This tax is called a rollback tax. (See Undeveloped Land, page 24 for more information.) 12

18 Partial Tax Exemption for Rehabilitated Real Estate An ordinance enacting a partial tax exemption for real estate that is substantially repaired, rehabilitated, or replaced became effective on January 1, The program is intended to encourage property owners to improve the condition and appearance of their properties. All improved property types are eligible for the exemption. The rehabilitation or replacement structure must increase the value of the original structure at least 25% to qualify for the exemption. Minimum age and maximum size increase requirements depending on property type must also be met. The tax exemption for properties in the rehabilitation program is applied over a fifteenyear period. Taxes are based on the assessed value of the property in its original condition for the first ten years it is in the program. For the next five years, the assessed value is increased in percentage increments until the property is assessed at its full renovated value. The following table provides information about properties currently receiving partial tax exemption. Summary of Tax Exemption for Rehabilitated Real Estate Property Type Date Exemption Began Tax Savings for 2001 Residential 1999 $2,988 Commercial ,546 Multifamily ,990 Commercial ,086 Commercial Residential ,647 Residential Residential Commercial Total Tax Savings for 2001 $76,344 13

19 Providing Customer Service The Real Estate Assessments Office provides services to all taxpayers in the form of accurate, equitable assessments. In addition, each year the assessments office provides direct assistance to thousands of citizens on an individual basis. One of the most direct forms of customer service is responding to appeals by taxpayers who are not certain their assessment is correct. Taxpayer appeals are explained in the Appeal Procedures section, page 9. Several other direct customer services provided by the assessments office are explained below. Walk-in Customers The assessments office has two main types of walk-in customers: taxpayers and real estate professionals. When taxpayers come to the Real Estate Assessments Office for assistance with understanding and applying for tax relief programs, the office staff works directly with them. The assessments office also has a brochure about tax relief for rehabilitated properties (see Addendum B, page B-5) and tax relief for the elderly and disabled (see Addendum C, page B-7). Most appraisers and real estate agents use the assessment office s sales lists, microfiche copies of tax records, and on-line access to the assessment database for research purposes. Telephone Requests From Real Estate Professionals While assessment information is available at the Real Estate Assessments Office to any citizen free of charge, many real estate professionals including brokers, agents, attorneys, appraisers, and settlement companies prefer to have the assessments office do research for them. The assessments office handles these business services on a fee-for-service plan through a 900 telephone number at a charge of $2.00 per minute. Effective July 2001, the Real Estate Assessments Office eliminated the 900 telephone number. Those calls are now answered freeof-charge by the Real Estate Assessments Office and the Taxpayer Services Office. Telephone Requests From Citizens and Public Agencies Citizens and public agencies are not charged for their inquiries. Many citizens call for information about the method of assessment used in valuing their property or about tax due 14

20 dates and other general facts. These, along with assessment appeals and calls from other public agencies, are handled as administrative calls. Internet Access Real estate assessment information is available free-of-charge on the County s website. Ownership information, physical descriptions, sales history, and assessment history for each property in the County are provided on the website at A summary of customer service activity is shown in the following table. Summary of Customer Service FY1999 FY2000 FY2001 Walk-in Customers 2,470 1,316 1,159 Real Estate Business Calls 17,524 9,311 8,127 Citizen/Public Agency Calls 13,956 12,111 15,764 Internet User Sessions* N/A 160, ,757 Total 33, , ,807 * A user session is a session of activity (all hits) for one user of the website. By default, a user session is terminated when a user is inactive for more than thirty minutes. Note: The number of Real Estate Business Calls and the number of Walk-in Customers has decreased as a result of information made available on the County s internet site. 15

21 REAL ESTATE VALUES For the purpose of comparing and analyzing real estate assessments, property in the County has been divided into several categories. The following table compares assessed values for each type of property for tax years 2000 and Landbook values are assessments as of January 1. State-valued public service assessments and supplemental assessments are added to the landbook to form the total tax base for the County. The assessed values of untaxed properties are added to taxable properties to show the total assessed value of the County and 2001 Assessed Values* Percentage Assessed Value Assessed Value Change Taxable Landbook Residential $ 12,025,990,000 $ 13,733,685, Apartments 663,240, ,986, Commercial and Industrial 2,448,482,400 2,760,787, Undeveloped Land 377,675, ,111,300 (11.01) Total Taxable Landbook 15,515,389,100 17,580,570, Supplements (1) Residential 201,402, ,117,600 Apartments 2,271,000 16,568,200 Commercial and Industrial 25,372,700 19,423,800 Undeveloped Land 444,500 1,100,800 Total Supplements 229,490, ,210, Public Service (2) 877,768, ,525,905 (0.03) Total Tax Base 16,622,647,969 18,748,306, Tax Exempt 1,466,410,400 1,529,680, Deferred Use Value (3) 252,068, ,619,200 (3.75) Total County Value $ 18,341,126,969 $ 20,520,606, *2000 and 2001 Assessed Values form the basis for FY2001 and FY2002 revenues, respectively. (1) Supplements are taxes billed for construction completed during the year and rollback taxes for properties that were eliminated from the use value program due to re-zoning or development. Supplements 2 and 3 for 2001 are not currently available. The values shown are estimated. (2) Public Service assessments are received by the County from the State in September of each year. (3) Deferred use value is the deferred value of properties in the Use Value Assessment Program. 16

22 Composition of Tax Base Assessed Values Commercial 14.83% Apartments 4.09% Undeveloped Land 1.80% Public Service 4.68% Residential 74.60% Landbook Values: Growth and Appreciation The 2001 landbook contains assessed values for all properties in the County as of January 1, The following categories of assessments are not included in the landbook: Assessments for state-valued public service properties (these are received from the State in September each year) Supplemental assessments (these are made after January 1, 2001) Each year, changes in landbook values for each category can be divided into two main influences: growth and appreciation. Changes in value due to growth result from the construction of new buildings and from land subdivisions. As the table on the following page shows, the residential, apartments, and commercial categories experienced positive growth. Subdivisions and reclassification caused negative growth in undeveloped land. Overall, new growth caused a 5.42% increase in the landbook. Changes in value due to appreciation are the result of changes in real estate market conditions, changes in property descriptions, physical deterioration, renovations, and additions. For the 2001 landbook, these factors caused existing residential, commercial, and apartment properties, and undeveloped land, to increase in value. Overall, the landbook value increased 17

23 5.42% for growth and 7.89% for appreciation, resulting in a total increase of 13.31% in the 2001 landbook value. The table below shows the 2000 to 2001 landbook changes attributable to growth and appreciation. Detailed and historical data are in the Statistical Appendix page A-11. Changes in Landbook Values 2000 to 2001 Percent Percent Total Growth Appreciation Percent Change Residential Apartments Commercial/Industrial Undeveloped Land (13.31) 2.30 (11.01) Total Landbook Residential The residential category includes improved and unimproved parcels zoned for residential use except multifamily rental apartment communities. The improved parcels in this category are mostly single family homes, townhouses, and condominiums. Total landbook value for residential properties increased 14.20% between 2000 and Growth caused a 6.60% increase in the residential assessed value. There were 3,419 new residential units with an average value of $232,557 added to the tax base for Appreciation caused the remaining 7.60% increase in the residential landbook. The table below shows the landbook value of residential property for the last three years and the following page shows the composition of the residential category, the composition of new construction, and the average assessed values of residential properties. Residential Landbook Assessments (Tax Years) Landbook Values $10,930,281,700 $12,025,990,000 $13,733,685,800 18

24 Types of Residential Property Landbook Percent of Total Parcel Count Landbook Value Residential Single Family 53,624 $ 10,142,977, Townhouses 24,451 2,760,050, Condominiums 5, ,523, Vacant Land 12, ,200, Other 1,731 15,933, Total Resid. Landbook 97,818 $ 13,733,685, Notes: This table is not a count of dwelling units in the County. Some parcels in the Single Family category may have more than one dwelling unit. New homes that were partially built as of January 1, 2001 are counted as if they were complete, although their value is discounted depending on the level of completion. Tax-exempt properties and apartment units are not included in this table. Types of Residential Property as Percentages of 2001 Residential Landbook Value Townhouses 20.10% Vacant Land Condominiums 3.02% 2.92% Other 0.12% Single Family 73.85% Of the 3,419 new homes built in the County during 2000, over half were single-family homes and townhouses assessed at over $200,000 for tax year The average assessment of all residential new construction was $232,557. The following table shows the breakdown of new homes by type and value. 19

25 Residential New Construction by Type New Units Over $200,000 New Units Under $200,000 All New Units Count Average Assessment Count Average Assessment Count Average Assessment Single Family $ 2,019 $ 281,554 $ 296 $ 179,745 $ 2,315 $ 268,536 Townhouses ,844 1, ,750 1, ,529 Condominiums N/A N/A , ,916 Total Residential 2, ,601 1, ,485 3, ,557 Average Residential Real Estate Tax for New Homes (Tax Rate = $1.30 per $100) $ 3,023 Note: This table includes residential homes completed during Homes partially built as of January 1, 2001 have been excluded. In 2001, all types of residential properties experienced increases in average assessed value. Listed below are the average assessments of residential dwelling types for the last three years. Average Residential Assessments by Type Single Family Detached $160,347 $170,719 $189,567 Townhouses $99,785 $103,867 $112,962 Condominiums $73,264 $74,778 $78,672 All Types $136,841 $144,979 $160,116 Note: These averages do not include tax-exempt properties, vacant lots, residences on commercial or agricultural land, parcels with more than one residence, or houses that were partially complete as of January 1, Comparison of Average Residential Assessments by Type $200,000 $180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $0 Single Family Detached Townhouses Condominiums All Types

26 New houses can influence the average assessed value positively or negatively, depending on the size, quality, and type of new construction. In general, new houses are more expensive than an average house in the County and therefore cause an increase in average assessed value. As a result, even if market factors or physical deterioration cause a decline in the value of existing properties, construction of new units may cause the overall average value to increase. In recent years, there has been a general upward trend of average values in residential properties in the County. A ten year history of average values is included in the Statistical Appendix, Table 6, page A-5. Apartments Apartments include residential rental communities containing six or more rental units as well as vacant land zoned for apartments. The unit count for 2001, including the small apartment complexes, is 13,725. (There are an additional 648 apartment units in the taxexempt category of the landbook.) The assessed value of apartments increased 13.08% from 2000 to Several apartment communities were under construction during 2000, with 244 new units completed for the 2001 landbook. Growth increased the landbook 4.03% while appreciation and reclassification caused a 9.05% increase in the assessed value of the apartment category. Higher apartment rents and lower vacancies countywide contributed to the increase. The following table is a summary of apartment information for the last three years. Apartment Summary (Tax Years) Number of Apartment Units 13,237 13,237 13,725 Average Assessment per Unit $46,386 $47,943 $53,561 Improved Parcels Only $ 614,015,100 $ 634,616,700 $ 735,126,900 Undeveloped Apartment Land 28,406,900 28,624,100 14,859,300 Total Landbook Values $ 642,422,000 $ 663,240,800 $ 749,986,200 Notes: Tax Exempt properties are not included in this table. The unit count increased in 2001 as a result of new units as well as reclassification of several properties into the apartment category. 21

27 Commercial and Industrial Locally-Valued Properties Locally-valued commercial and industrial properties consist of all non-residential uses such as retail, office, hotel, industrial, warehouse, and vacant parcels with commercial or industrial zoning. Properties owned by public service companies such as utility companies and railroads are not locally-assessed. Locally assessed commercial and industrial properties increased 12.76% from 2000 to New construction caused a 2.88% increase in the commercial tax base. There were 897,223 square feet of commercial space added to the tax base for tax year The largest amount of growth occurred within the office and industrial categories, which together account for over 60% of new commercial space. Existing commercial property reassessment caused a 9.87% increase in landbook value. Hotel, office, and industrial properties increased slightly while the retail sector experienced the highest increase in reassessment. The table below contains landbook assessment information about locally assessed commercial and industrial properties. Locally-Valued Commercial/Industrial Assessments* (Tax Years) Landbook Values $2,232,907,300 $2,448,482,400 $2,760,787,100 *State-valued public service properties are not included in this category. State-Valued Public Service Properties State-valued public service properties are assessed by the State Corporation Commission (SCC) and the Virginia Department of Taxation. The SCC assesses all telecommunications companies, water corporations, intrastate gas pipeline distribution companies, and electric light and power corporations. The Virginia Department of Taxation assesses railroads and interstate pipeline transmission companies. The County receives these assessed values in September of each year and then issues bills and collects taxes. Since the assessments are not available when first half tax bills are due on July 15, the first half taxes are based on the prior year assessment 22

28 and adjusted on the second half tax bill. The table below shows the total assessed values for Public Service properties. State-Valued Public Service Assessments (Tax Years) Assessed Value $871,897,315 $877,768,069 $877,525,905 The following table and chart compare 2001 landbook values of different types of locally and state-valued properties. Types of Commercial/Industrial Property 2001 Landbook Number of 2001 Percent of Total Parcels Landbook Commercial/Ind. Locally Assessed Retail 884 1,181,383, Offices ,191, Industrial ,233, Technology Services 2 78,889, Other ,065, Vacant Land 1, ,024, Total Locally Assessed 4,016 2,760,787, Total State Valued 877,525, Total Commercial/Industrial 3,638,313, Note: Changes in parcel counts since 2000 are due to new construction and re-classification. 23

29 Comparison of Types of Commercial/Industrial Property 2001 Landbook State Valued 24.12% Retail 32.47% Other 11.57% Vacant Land 10.23% Technology Services 2.17% Industrial 9.87% Office s9.57% Undeveloped Land Undeveloped land consists of large acreage tracts of farm land and other undeveloped properties greater than twenty acres. The total decrease in value for this category from 1999 to 2000 was 8.39%. From 2000 to 2001, there was an 11.01% decrease. The decrease is partially due to reductions in use value assessments determined by the State Land Evaluation Advisory Council (SLEAC). Re-zonings and land development caused some parcels to be reclassified, further reducing the value of this category. The following table reflects the landbook values of this category for 1999 through Undeveloped Land Assessments (Tax Years) Landbook Values $412,250,800 $377,675,900 $336,111,300 24

30 Some of these undeveloped parcels qualify for the Use Value Assessment Program and are not taxed at market value. The State Land Evaluation Advisory Council recommends the use value assessments used by the County for property in the program. These values typically range from $20 to $330 per acre (see Tax Relief Based on Use Value Assessment, page 12 for more information). There are 856 parcels currently in the Use Value Assessment Program. The use value assessment for the land portion of these parcels is $37,887,100 while the assessment at market value is $280,506,300. (Buildings do not have use value assessments and are therefore assessed at full market value.) The estimated amount of revenue the County will defer for tax year 2001 is $3,154,050. The table below compares use values this year with those in 1999 and The use value for properties in the program decreased 6.10% from 2000 to 2001 due to value reductions made by SLEAC and the removal of several properties from the program. For a more complete history, see the Statistical Appendix, Table 5, page A-4. Use Value Assessment Summary (Tax Years) Number of Acres 49,853 49,451 58,397 Number of Parcels Market Value Assessment $ 299,518,000 $ 292,415,900 $ 280,506,300 Deferred Assessment (253,753,100) (252,068,600) (242,619,200) Use Value Assessment $ 45,764,900 $ 40,347,300 $ 37,887,100 Deferred Tax $ (3,451,042) $ (3,377,719) $ (3,154,050) Rollback Taxes* 223, ,850 1,206,600 Net Tax Deferred $ (3,227,264) $ (2,992,869) $ (1,947,450) *The 2001 value for rollback taxes is an estimate. Supplemental Assessments Supplemental assessments include prorated assessments on newly completed construction, rollback taxes from the Use Value Assessment Program, and prorated assessments for properties which become taxable during the year. When construction is completed during the year, the increase in assessed value between the January 1 assessment and the completed value is prorated based on the number of months the property is complete 25

31 and fit for occupancy. The owner of the property receives a tax bill for the prorated increased value. Supplemental Assessments (Tax Years) * Assessed Value $202,544,400 $229,490,800 $290,210,400 *Supplement 1 assessments for 2001 are actuals; however, Supplement 2 and 3 assessments for 2001 are estimated. Tax-Exempt Properties Section of the Code of Virginia requires the County to place an assessment on all property except road rights-of-way and public service properties, which are valued by the State. Therefore, the County is required to assess all tax-exempt properties. For 2001, there were 1,749 tax-exempt parcels consisting of federal, state, and county-owned properties, as well as properties owned by churches, schools, and other tax-exempt organizations. The total assessed value of exempt properties for 2001 is $1,529,680,800 and the total amount of taxes exempted is $19,885,850. A summary of the assessed values of tax-exempt properties by category for 1999 through 2001 and a chart showing the relative proportion of each category of tax-exempt properties for 2001 follows. Assessed Values of Tax-Exempt Properties (Tax Years) Federal $ 469,015,600 $ 469,239,800 $ 479,848,400 State 89,219,600 87,615,600 90,327,900 Regional 16,277,600 16,453,200 17,041,000 Local 704,884, ,969, ,630,600 Religious 126,159, ,765, ,111,800 Charitable 22,889,500 23,141,400 23,412,700 Educational 10,315,600 10,334,200 10,660,600 Other 5,208,900 28,890,500 29,647,800 Total Tax Exempt $ 1,443,970,900 $ 1,466,410,400 $ 1,529,680,800 % of Total County Value 8.50% 8.00% 7.45% Note: Potomac Hospital was reclassified from the Local category to the Other category for tax year 2000, causing a significant increase in the value of the Other category. New construction and reassessment of County-owned properties largely offset the decrease in the Local category. 26

32 Types of Tax-Exempt Properties Tax Year 2001 Religious 9.42% Charitable 1.53% Educational 0.70% Other 1.94% Federal 31.37% Local 48.03% Regional 1.11% State 5.91% 27

33 Statistical Appendix A-1

34 This page intentionally left blank. A-2

35 Table 1: History of Property Record Maintenance Activity FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998 FY 1999 FY 2000 FY 2001 Wills New Lots 1,604 1,253 3,366 2,916 2,178 2,238 2,945 2,130 3,189 3,867 Deeds 7,973 8,481 8,964 8,313 8,710 9,631 10,438 12,120 12,941 16,100 Transfers * * * * * * 14,381 14,243 14,831 16,652 *Data for transfers not tracked prior to FY1998. Table 2: History of Tax Relief for the Elderly and Disabled FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998 FY 1999 FY 2000 FY 2001 Number Exempted Amount Exempted $734,445 $807,108 $811,137 $912,509 $920,860 $952,411 $905,620 $1,010,781 $ 998,470 $ 1,176,134 Number Deferred Amount Deferred $75,660 $88,338 $88,228 $163,524 $181,398 $210,384 $274,127 $254, , ,490 Table 3: History of Appeals Activity TY 1991 TY 1992 TY 1993 TY 1994 TY 1995 TY 1996 TY 1997 TY 1998 TY 1999 TY 2000 Appeals to Assessor 1, Changed by Assessor* % Changed 53% 66% 57% 72% 55% 73% 51% 78% 51% 83% Appeals to BOE , Changed by BOE* % Changed 68% 38% 27% 34% 36% 46% 7% 13% 40% 13% Appeals to Court Total 1,387 1,545 1,942 1,115 1,138 1,266 1, * May have been decreased or increased. Table 4: History of Adjustments TY 1991 TY 1992 TY 1993 TY 1994 TY 1995 TY 1996 TY 1997 TY 1998 TY 1999 TY 2000 Number Adjusted , , Tax Amt. Reduced $1,269,478 $1,187,221 $1,257,546 $1,260,667 $1,463,971 $1,332,849 $1,034,111 $1,244,595 $829,138 $707,867 Note: These numbers include all adjustments as a result of appeals and highway takings. A-3

36 A-4 Table 5: Use Value Assessment Summary # of Market Value Use Value Assessment Percent Tax Rate Tax Rollback Net Annual Year Parcels Acres Assessment Assessment Reduction Reduction per $100 Reduction Taxes* Deferral ,421 $170,019,960 $32,898,820 $137,121, $1,919,696 $128,012 $1,791, ,043 75, ,334,200 33,049, ,284, ,222, ,914 2,101, ,165 78, ,634,700 32,567, ,066, ,386, ,863 2,238, ,155 76, ,140,600 33,785, ,355, ,367, ,131 2,220, ,182 76, ,768,300 33,930, ,838, ,397, ,897 2,184, ,145 77, ,607,800 43,264, ,343, ,546, ,070 2,275, ,134 73, ,469,300 41,748, ,720, ,594, ,885 1,706, ,047 71, ,535,500 40,086, ,449, ,268,840 1,016,223 2,252, ,029 68, ,188,200 42,454, ,733, ,185,121 1,124,842 4,060, ,004 62, ,815,200 49,183, ,632, ,012,723 3,140,863 4,871, , ,482,700 61,316, ,166, ,890,259 3,257,683 4,632, , ,640,500 72,679, ,961, ,065,075 2,258,296 3,806, , ,490,400 61,724, ,765, ,273, ,169 5,082, , ,613,100 49,787, ,825, ,512, ,108 4,257, , ,645,200 50,133, ,511, ,937, ,060 3,646, , ,012,900 46,461, ,551, ,720, ,028 3,432, , ,738,300 50,737, ,000, ,644, ,541 3,255, , ,470,900 47,371, ,099, ,469,359 1,221,495 2,247, , ,863,600 47,168, ,694, ,355, ,859 2,998, , ,518,000 45,764, ,753, ,451, ,779 3,227, , ,415,900 40,347, ,068, ,377, ,850 2,992, , ,506,300 37,887, ,619, ,154,050 1,206,600 1,947,450 *2001 rollback taxes are estimated.

37 Table 6: Average Assessed Value History of Residential Property Single Family All Percent Total Number Year and Duplexes Townhouses Condominiums Residential Change of Units** 2001 $189,567 $112,962 $78,672 $160, % 82, , ,867 74, , % 79, ,347 99,785 73, , % 76, ,564 98,953 73, , % 73, ,867 97,802 72, , % 71, ,836 97,399 72, , % 69, ,752 96,179 66, , % 69, ,979 97,400 73, , % 67, ,319 98,995 74, , % 65, , ,781 75, , % 64,446 ** The units included in this table are all residential properties in the Single Family Detached, Duplex, Townhouse and Condominium categories. Houses on commercially zoned or agricultural parcels and houses that were partially complete as of January 1, 2001 are not included. Tax exempt properties and parcels owned by homeowners associations are also not included. The difference between the unit counts in successive years does not always equal the number of new houses added. During reassessment, properties are often reclassified, causing the unit counts to be slightly inconsistent. Average Assessed Value All Residential A-5 Average Assessment 165, , , , , , , , , ,

38 A-6 Table 7: Assessed Values and Estimated Market Values Residential Apartments Commercial Estimated Estimated Estimated Assessed Market Assessed Market Assessed Market Year Value (1) Ratio (2) Value Value Ratio Value Value Ratio Value 1980 $2,131,797, % $2,574,365,693 $126,407, % $154,344,200 $227,463, % $281,513, ,496,165, % 2,995,959, ,525, % 168,432, ,782, % 271,045, ,897,995, % 3,236,546, ,967, % 173,147, ,271, % 294,540, ,106,709, % 3,444,667, ,938, % 169,997, ,997, % 368,891, ,343,656, % 3,655,269, ,684, % 192,297, ,914, % 397,560, ,676,671, % 3,954,640, ,598, % 175,496, ,988, % 522,773, ,286,555, % 4,817,572, ,779, % 177,444, ,967, % 719,301, ,915,038, % 5,697,619, ,431, % 232,600, ,264, % 996,859, ,073,000, % 6,991,343, ,937, % 418,987,030 1,206,843, % 1,307,522, ,375,061, % 8,234,119, ,846, % 485,861,799 1,581,679, % 1,749,644, ,621,293, % 9,198,674, ,596, % 531,052,508 1,984,167, % 2,131,221, ,603,397, % 9,018,236, ,557, % 535,736,647 2,110,896, % 2,294,452, ,602,192, % 9,014,458, ,531, % 533,540,628 2,286,505, % 2,523,736, ,606,600, % 9,250,118, ,593, % 479,132,903 2,103,214, % 3,070,386, ,803,946, % 9,449,674, ,795, % 537,334,227 1,951,947, % 2,080,967, ,188,858, % 9,810,444, ,437, % 542,622,839 1,895,893, % 2,227,842, ,485,586, % 10,118,012, ,799, % 564,817,697 1,953,576, % 2,189,372, ,860,168, % 10,421,211, ,714, % 579,378,926 2,012,226, % 2,209,781, ,369,909, % 11,007,854, ,458, % 653,810,779 2,160,783, % 2,400,604, ,098,693, % 11,971,432, ,008, % 691,110,060 2,257,215, % 2,448,970, ,227,392, % 13,741,731, ,511, % 748,018,208 2,473,855, % 2,815,358, ,986,803, % 15,719,041, ,554, % 861,587,501 2,780,210, % 3,164,004,666 (1) Assessed values include landbook values plus all supplements. (2) Ratios are from the Department of Taxation Sales Ratio Study. Since the ratios for the two most current years are not available, they are estimated based on the assessment office s internal sale ratio report. Where no ratio is calculated because of insufficient sales, the county average is used.

39 Table 7: Assessed Values and Estimated Market Values (cont.) Land Public Service Totals Use Estimated Public Public Estimated Total Total Total Value Market Market Service Service Market Use Value Market Estimated Year Assm't (3) Assm't Ratio Value Equal (4) Unequal (5) Ratio Value Assessment Assessment Ratio Market Value 1980 $206,691,850 $343,812, % $415,735,175 $305,403,717 $10,170, % $381,589,652 $3,007,935,398 $3,145,056, % $3,807,548, ,326, ,610, % 414,386, ,668,359 13,258, % 418,377,221 3,444,727,003 3,598,011, % 4,268,201, ,653, ,720, % 431,609, ,754,502 11,257, % 424,594,058 3,888,899,382 4,056,966, % 4,560,437, ,612, ,968, % 388,025, ,476,418 5,090, % 421,273,367 4,116,825,404 4,287,181, % 4,792,856, ,745, ,583, % 483,626, ,781,045 3,379, % 466,696,638 4,533,161,187 4,701,999, % 5,195,450, ,705, ,049, % 675,896, ,338,943 1,679, % 492,460,734 5,075,984,085 5,255,327, % 5,821,266, ,311, ,032, % 444,481, ,523, % 549,408,585 5,752,137,351 5,934,858, % 6,708,207, ,263, ,713, % 796,435, ,325, % 588,135,111 6,932,323,313 7,183,772, % 8,311,650, ,299, ,032, % 905,892, ,159, % 620,160,340 8,598,239,493 8,973,972, % 10,243,906, ,648,993 1,472,281, % 1,645,006, ,430, % 652,995,297 10,867,666,289 11,448,298, % 12,767,628, ,147,820,291 1,727,986, % 1,844,169, ,919, % 743,777,301 12,947,796,434 13,527,962, % 14,448,894, ,081,751,418 1,527,712, % 1,603,056, ,275, % 778,883,004 13,048,878,038 13,494,839, % 14,230,365, ,096,724 1,170,862, % 1,226,034, ,794, % 815,491,440 12,960,120,146 13,347,885, % 14,113,261, ,073, ,899, % 1,045,053, ,714, % 858,832,469 12,594,196,679 12,926,022, % 14,703,524, ,077, ,588, % 919,086, ,541, % 893,284,979 12,656,308,563 12,945,819, % 13,880,347, ,823, ,374, % 846,717, ,162, % 891,315,369 12,948,175,030 13,221,726, % 14,318,942, ,215, ,215, % 834,984, ,728, % 880,307,761 13,309,906,073 13,577,906, % 14,587,494, ,820, ,919, % 839,924, ,430, % 875,242,874 13,794,360,537 14,049,460, % 14,925,538, ,798, ,493, % 757,616, ,813, % 917,846,018 14,483,764,679 14,730,459, % 15,737,732, ,488, ,241, % 725,753, ,897, % 937,120,932 15,292,303,515 15,546,056, % 16,774,387, ,120, ,189, % 708,316, ,768, % 986,588,815 16,622,647,969 16,874,716, % 19,000,012, ,212, ,831, % 651,715, ,525, % 986,316,629 18,748,306,705 18,990,925, % 21,382,666,126 (3) Certain agricultural and forestal land is granted special use value assessment. (4) Railroads and pipelines are valued by the Department of Taxation. Other utility property is valued by the State Corporation Commission. (5) Part of Public Service property was phased into market value over a period of years ending in FY A-7

40 A-8 Table 8: History of the Real Estate Tax Base* Amount Percent Amount Percent Amount Percent Amount Percent Residential $ 8, $ 9, $ 9, $ 9, Apartments Commercial/Ind. 1, , , , Agricultural Total Local 11, , , , Public Service Total $ 12, $ 12, $ 13, $ 13, ** Amount Percent Amount Percent Amount Percent Amount Percent Residential $ 10, $ 11, $ 12, $ 13, Apartments Commercial/Ind. 2, , , , Agricultural Total Local 13, , , , Public Service Total $ 14, $ 15, $ 16, $ 18, *Assessments include original landbook plus supplements. ** Supplements 2 and 3 are estimated for Note: All amounts are in millions.

41 Note: Supplement 2 and 3 assessments for 2001 are estimated. Table 9: Public Service and Commercial/Industrial Assessments Public Service 5.38% 5.69% 6.01% 6.34% 6.58% 6.45% 6.20% 6.02% 5.98% 5.70% 5.28% 4.68% Commercial/Ind % 16.18% 17.64% 16.70% 15.42% 14.64% 14.68% 14.59% 14.92% 14.76% 14.88% 14.83% Total 20.71% 21.87% 23.65% 23.04% 22.00% 21.09% 20.88% 20.61% 20.90% 20.46% 20.16% 19.51% Comparison of Public Service and Commercial/Industrial Assessments 25% Percentage of Tax Base 20% 15% 10% 5% Public Service Commercial/Ind. 0% A-9

42 A-10 Table 10: Assessment Performance Statistics Level of Assessment(1) ** Standard (3) Residential Urban 95.40% 95.80% 94.00% 94.10% 93.90% 94.06% 95.28% 95.20% 93.43% 89.33% % Residential Suburban 95.40% 93.60% 87.80% 91.00% 92.50% 92.14% 91.78% 89.90% 88.77% 85.21% % Weighted Average (Residential) 95.40% 95.43% 93.04% 93.17% 93.66% 93.75% 94.62% 94.20% 92.71% 88.98% % Apartment * * * * * * * * * * % Commercial/Industrial 92.00% 90.60% 68.50% 93.80% 85.10% 89.23% 91.06% 90.01% 92.17% 87.87% % Agricultural * * * * * * * * * * % Overall Median 95.30% 95.50% 93.00% 93.20% 93.70% 93.80% 94.88% 94.44% 93.04% 88.97% % Equity of Assessments(2) ** Standard (3) Residential Urban 3.10% 3.42% 4.23% 4.66% 7.04% 6.75% 5.50% 5.98% 5.91% 6.48% 10.00% Residential Suburban 4.10% 4.58% 9.10% 7.07% 9.69% 9.03% 10.37% 10.41% 10.71% 11.49% 10.00% Weighted Average (Residential) 3.23% 3.62% 4.98% 5.39% 7.49% 7.12% 6.42% 6.81% 6.65% 7.22% 10.00% Apartment * * * * * * * * * * 15.00% Commercial/Industrial 6.00% 12.42% 24.66% 12.53% 18.85% 31.07% 17.86% 28.13% 24.59% 26.83% 15.00% Agricultural * * * * * * * * * * 20.00% Overall Equity 3.20% 3.61% 6.84% 6.07% 7.77% 7.48% 6.87% 7.50% 7.06% 7.48% 10.00% * Insufficient sales. ** 2000 ratios are estimated by the assessments office based on 2000 sales. There is not enough information to make an estimate for (1) "Level of Assessment" refers to the median ratio of assessment to selling price as reported by the Department of Taxation. (2) "Equity of Assessments" is the average percentage sales deviate from the median ratio. (3) Standards are provided by the International Association of Assessing Officers.

43 1999 to 2000 Table 11A: Growth and Appreciation Appreciation Growth Total Landbook Value Amount % Amount % Landbook Value Change Residential $ 10,930,281,700 $ 471,095, $ 624,613, $ 12,025,990, Apartments 642,422,000 20,818, ,240, Commercial/Industrial 2,232,907,300 39,323, ,251, ,448,482, Agricultural 412,250,800 (5,052,700) (1.23) (29,522,200) (7.16) 377,675,900 (8.39) Total Landbook 14,217,861, ,184, ,342, ,515,389, Public Service* 871,897, ,870, ,768, Total $ 15,089,759,115 $ 526,184, $ 777,213, $ 16,393,157, to Appreciation Growth Total Landbook Value Amount % Amount % Landbook Value Change Residential $ 12,025,990,000 $ 914,392, $ 793,303, $ 13,733,685, Apartments 663,240,800 60,036, ,708, ,986, Commercial/Industrial 2,448,482, ,721, ,583, ,760,787, Agricultural 377,675,900 8,686, (50,251,100) (13.31) 336,111,300 (11.01) Total Landbook 15,515,389,100 1,224,837, ,344, ,580,570, Public Service* 877,768, (242,164) (0.03) 877,525,905 (0.03) Total $ 16,393,157,169 $ 1,224,837, $ 840,102, $ 18,458,096, *All changes in Public Service are attributed to growth. Note: These tables do not include supplements. A-11

44 A-12 Table 11B: History of Appreciation Rates Public Landbook Residential Apartments Commercial Service Land Overall % % -6.25% 0.00% % -3.60% % % % 0.00% % -4.96% % 5.11% -9.18% 0.00% % -2.09% % 0.50% -7.00% 0.00% -8.68% -0.47% % 0.96% 0.36% 0.00% -3.86% -0.49% % -2.08% 1.41% 0.00% -4.99% 0.05% % 6.80% 5.40% 0.00% -4.56% 1.85% % 2.58% 2.15% 0.00% -4.43% 1.74% % 3.24% 1.76% 0.00% -1.23% 3.49% % 9.05% 9.87% 0.00% 2.30% 7.47% Table 11C: History of Growth Rates Public Landbook Residential Apartments Commercial Service Land Overall % 13.11% 4.38% 2.00% 10.14% 3.45% % 0.04% 3.75% 2.56% 5.88% 2.22% % 6.71% 2.56% 0.44% 0.00% 2.32% % 1.55% 3.23% 2.00% 1.64% 2.72% % 1.48% 3.47% -1.13% -0.52% 3.25% % 6.22% 1.67% 3.00% -0.52% 3.24% % 6.23% 1.94% 4.38% -0.55% 3.58% % 2.27% 1.54% 0.59% -0.58% 3.64% % 0.00% 7.89% 2.00% -7.16% 5.23% % 4.03% 2.88% 2.81% % 5.28% Note: These tables included Public Service properties in addition to the landbook categories. All changes in Public Service are attributed to growth. These tables do not include supplements. These rates represent the effects of growth and appreciation from the prior year on the landbook for the year shown.

45 Table 12: Top Fifty Real Estate Taxpayers FY2001 Rank Owner Name 2000 Assessment % of Tax Base Rank Owner Name 2000 Assessment % of Tax Base 1 VIRGINIA ELECTRIC & POWER COMPAN $410,718, % 26 JJJ AMPHITHEATER LIMITED PTNSHP $23,433, % 2 WASHINGTON OUTLET MALL LTD $192,584, % 27 COSCAN WASHINGTON INC $23,278, % 3 NORTHERN VIRGINIA ELECTRIC CO-OP $157,946, % 28 HOUSING & URBAN DEV SEC $21,805, % 4 GTE SOUTH $136,738, % 29 DOMINION COUNTRY CLUB LP $21,264, % 5 AMERICA ONLINE INC $71,065, % 30 SRK MISTY RIDGE ASSOCS LTD PTNSHP $21,059, % 6 WNH LIMITED PARTNERSHIP $62,889, % 31 POWELLS CREEK TOWNE SQUARE LTD $18,747, % 7 MANASSAS MALL LLC $61,473, % 32 VETERANS AFFAIRS SEC $18,299, % 8 WASHINGTON GAS LIGHT COMPANY $59,461, % 33 WINDSOR POTOMAC VISTA LTD PTNSHP $18,296, % 9 HYLTON IRENE TRUST $57,915, % 34 SUMMERLAND HEIGHTS LP $18,295, % 10 POTOMAC MILLS PHASE III LTD PTNSH $54,784, % 35 RIDGEDALE INC $17,926, % 11 HYLTON $53,352, % 36 WAL MART STORES INC $17,376, % 12 KIR SMOKETOWN STATION LP $45,830, % 37 K HOVNANIAN AT PRINCE WILLIAM LLC $17,353, % 13 LBK LP $41,065, % 38 COMBINED PROPERTIES LMTD PARTNSHP $16,840, % 14 U S HOME CORPORATION $39,809, % 39 PIEDMONT LC $16,546, % 15 WESTMINSTER PRESBYTERIAN RETIRE $36,275, % 40 RTJ LIMITED LIABILITY COMPANY $15,787, % 16 IBV-IMMOBILIENFONDS INT'L 2 USA LP $35,933, % 41 LAKESIDE II LP A/K/A MARKET AT OPITZ CR $15,767, % 17 ACQUIPORT MIDATLANTIC RETAIL INC $34,057, % 42 POTOMAC FESTIVAL LTD $15,569, % 18 PRINCE WILLIAM SQUARE ASSOCIATES $32,520, % 43 VMS ANDEN SOUTHBRIDGE VENTURE $15,460, % 19 UNITED DOMINION REALTY TRUST INC $29,135, % 44 BEAZER HOMES CORP $15,270, % 20 METROPOLITAN LIFE INSURANCE COM $27,583, % 45 BIRCHWOOD MANASSAS ASSOCIATES LLC $15,107, % 21 PARADISE RIDGE ASSOCS LTD PTNSH $27,523, % 46 ORCHARD GLEN EAST INC $14,998, % 22 WESTGATE APARTMENTS LMTD PARTN $26,820, % 47 PARADISE SUDLEY NORTH LTD PTNSHP $14,977, % 23 LOCKHEED MARTIN FEDERAL SYSTEM $26,531, % 48 BELMONT BAY L C $14,417, % 24 TC CARLYLE STATION CO $25,780, % 49 VIRGINIA AMERICAN WATER COMPANY $14,394, % 25 E&A SOUTHEAST LTD PTNSHP $24,908, % 50 COLUMBIA GAS SERVICE OF VA $14,377, % Tax Base = $16,393,157,169 (Total 2000 Landbook Plus Public Service Assessments) A-13

46 A-14 Table 13: Tax Rates Base Tax Rate Fire Districts Buckhall Wellington Dumfries Fire ** Dumfries Rescue ** Dumfries ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** ** Gainesville Stonewall Evergreen Neabsco Nokesville O.W.L Yorkshire Coles Lake Jackson Montclair ** ** ** ** ** ** ** ** ** ** ** Montclair South ** ** ** ** ** ** ** ** ** ** ** ** ** ** Dale City Sanitary ** ** ** ** ** ** ** Formost Court Service ** ** ** ** ** ** ** ** ** ** ** ** ** ** Woodbine Forest Service ** ** ** ** ** ** ** ** ** ** ** ** ** ** Lake Jackson Service ** ** ** ** ** ** ** ** ** ** ** ** ** Bull Run Service ** ** ** ** ** ** Bull Run Sanitary ** ** ** ** ** ** ** ** ** ** ** Occoquan Forest Sanitary ** ** ** ** ** ** Prince William Parkway ** ** ** ** ** ** ** Bypass District ** ** ** ** ** ** ** ** Gypsy Moth Control ** ** ** ** ** ** ** **

47 Addenda B-1

48 B-2 This page intentionally left blank.

49 Addendum A: Sample Notice of Reassessment B-3

50 B-4 Addendum A: Sample Notice of Reassessment (cont.)

51 Addendum B: Rehabilitated Real Estate Program Tax Exemption for Rehabilitated Real Estate Program Tax Savings for Rehabilitating Your Home or Business What is the program? The Prince William Board of County Supervisors has approved an ordinance enacting a partial tax exemption for real estate that is substantially repaired, rehabilitated, or replaced. The tax exemption program encourages renovation and revitalization of aging structures located in the County. By improving the condition and appearance of existing properties, Prince William County will become a more appealing place for homeowners and businesses to invest. The amount of exemption is based on the increase in building value caused by rehabilitation. The minimum increase in value of the building is 25%. Exemptions are allowed for all property types: residential, commercial or industrial, and hotel or motel. Minimum age and size increase requirements apply. The tax exemption is applied over a 15 year period. The total tax savings is equal to 100% of the exemption each year for the first 10 years. Over the next 5 years the tax savings is reduced and the exemption is phased out as follows: 80% in year 11, 60% in year 12, 40% in year 13, 20% in year 14, and 0% in year 15. The tax exemption is transferable to a new property owner during the program period. What are the requirements? Participation in the program is subject to the following requirements. The increase in building value due to rehabilitation, renovation, or replacement must be 25% or more of the building value before any work is done. Residential structures must be at least 15 years old and increase in size no more than 30%. Commercial or industrial structures must be at least 20 years old and increase in size no more than 100%. Hotel or motel structures must be at least 35 years old and increase in size no more than 100%. You must complete the rehabilitation by December 31 of the third calendar year after your application was submitted. You must submit the application and $50 non-refundable application fee after you obtain appropriate building permits, but before any work is started. Taxes must be kept current to qualify and remain in the program. All work must conform to existing building and zoning regulations. Applications must be filed after January 1, 1998, but before December 31, The maximum length of time for tax exemption is 15 years. B-5

52 Other Information The base value of the structure will be the assessed value before commencement of any work. The Real Estate Assessments Division will make a final appraisal of the structure after work is complete, or after three years, to determine the increase in value due to rehabilitation. All work must conform to building and zoning regulations. Increase in assessed value due to rehabilitation is not equal to rehabilitation costs. Tax exemption is for the base real estate tax rate only and does not apply to fire and rescue levy, gypsy moth levy, stormwater management fee, or any other special taxing districts. The tax exemption does not apply to land value. 5 Steps to Exemption To begin your real estate tax savings, follow these 5 steps toward exemption. 1. Building Permits Obtain all necessary building permits before applying for tax exemption. Contact the Construction Permits and Records Office at (703) or The building permit office is located in the McCoart Building at 1 County Complex Court, Prince William, VA Complete Application Complete an application form for the Tax Exemption for Rehabilitated Real Estate Program. Include with the application copies of all necessary building permits and a $50 non-refundable application fee. Submit the application to the Real Estate Assessments Division located at 4379 Ridgewood Center Drive, Suite 203, Prince William, VA Determine Base Value Upon application approval, the Real Estate Assessments Division will inspect the property to determine the base value. The base value will be the assessed value before the commencement of any work. 4. Request Final Inspection When rehabilitation is complete, submit a written request for inspection to Real Estate Assessments Division. Include a copy of the certificate of occupancy with the inspection request. Requests should be received prior to November 1 of the year in which the rehabilitation is complete. 5. Begin Exemption If the property qualifies for the tax exemption program, exemption will begin on January 1 of the next calendar year. How do I learn more? For more information about the exemption program, or to make an appointment to discuss the program, contact the Real Estate Assessments Division at (703) Offices are located at 4379 Ridgewood Center Drive, Suite 203, Prince William, VA Applications can be obtained by calling the Real Estate Assessments Division. Information booklets and applications are also available at the building permit office located in the McCoart Building at 1 County Complex Court, Prince William, VA B-6

53 Addendum C: Tax Relief Programs A Citizen's Guide to Tax Relief Programs for Elderly and Disabled Persons Tax Relief Programs for Elderly and Disabled Persons Senior citizens and disabled persons who meet certain criteria (see eligibility criteria below) may be granted relief from all or part of real estate taxes, the vehicle license decal fee, and qualify for a reduced tax rate on their personal property tax. Qualifying limits may change from year to year. The limits in this brochure are current for the tax year beginning January 1, 2001, only. Tax relief is granted on an annual basis and a new application must be filed each year. Applications may be filed anytime after January 1st, but before April 15, Eligibility Criteria Senior Citizens: To qualify, an applicant must: - be 65 years of age or older as of December 31, 2000 B-7 Department of Finance Real Estate Division Prince William County Virginia - have a gross household income from all sources of not more than $40,150. In determining income, the first $6,500 of income earned by any relative living in the household other than the owner(s) or spouse is excluded. - have a combined financial net worth for the applicant and spouse residing in the household of not more than $195,000, excluding the residence for which the exemption is sought and up to one acre of land which it occupies.