In Boone County, accurate assessments generate fair property taxes Alan Zielinski, Boone County Chief Assessment Officer

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1 In Boone County, accurate assessments generate fair property taxes Alan Zielinski, Boone County Chief Assessment Officer

2 Tonight s presenters: Curtis P. Newport, Boone County Treasurer Al Zielinski, Boone County Chief Assessment Officer 2017 Alan Zielinski, Boone County Chief Assessment Officer 2

3 Profound gratitude to our sponsors: State Representative Bob Prichard, State Representative Joe Sosnowski, State Senator Dave Syverson Alan Zielinski, Boone County Chief Assessment Officer 3

4 Acknowledgements Our offices exist to serve taxpayers. Taxpayers deserve honesty, accuracy, fairness and hard work. In Boone County, Township Assessors determine value. The Assessment Office works in close concert with Julie Stapler, Boone County Clerk and Curtis Newport, Boone County Treasurer Alan Zielinski, Boone County Chief Assessment Officer 4

5 Property Tax Cycle: a Team Effort Township Assessors (parcel valuation & BoR/PTAB defense) County Treasurer Curtis Newport (prepare & mail property tax bills) CCAO Al Zielinski (direction & statutory compliance) County Clerk Julie Stapler (calculate tax rates & extension) Board of Review (hear appeals & set final values) 2017 Alan Zielinski, Boone County Chief Assessment Officer 5

6 Boone County Assessment Office: accuracy and fairness for all Alan Zielinski, Boone County Chief Assessment Officer 6

7 Credentials B.S., Chemical Engineering, Purdue University. MBA, Michigan State University. Six Sigma Master Black Belt. Three+ decades valuation experience. Certified appraiser in IL & WI. Four years as Grafton Township Assessor ($1.5B EAV, 21,662 parcels). Elected to a second term last year via write-in. USMC Veteran Alan Zielinski, Boone County Chief Assessment Officer 7

8 Mantras 2017 Alan Zielinski, Boone County Chief Assessment Officer 8

9 Assessment Office s Focus Three promises when I took office. 1. Absolute adherence to the Illinois Property Tax Code Alan Zielinski, Boone County Chief Assessment Officer 9

10 Assessment Office s Focus Three promises when I took office. 2. Help develop market-based valuations (improve accuracy) Alan Zielinski, Boone County Chief Assessment Officer 10

11 Assessment Office s Focus Three promises when I took office. 3. Help achieve uniformity (improve fairness) Alan Zielinski, Boone County Chief Assessment Officer 11

12 Four Presentation Take-Aways 1. Property taxes are primarily driven by the total levy, not individual parcel values. (No levy, no property tax regardless of a parcel s value.) 2. The total levy (the amount of money designated by all taxing districts) determines the amount of the total property tax to be collected Alan Zielinski, Boone County Chief Assessment Officer 12

13 Four Presentation Take-Aways 3. Individual parcel values determine their share of the total property tax. 4. There is no direct relationship between assessments and property taxes. Examples: two parcels have the same assessment but different taxes. Each has different exemptions. The parcels are subject to different levies Alan Zielinski, Boone County Chief Assessment Officer 13

14 Related but Distinct Concepts 2017 Alan Zielinski, Boone County Chief Assessment Officer 14

15 Property Tax Simplicity: Levy = amount Assessments = share 2017 Alan Zielinski, Boone County Chief Assessment Officer 15

16 Property Tax Definition #1 Levy: the total dollar amount imposed by all the taxing districts in which a parcel is located. Likely different for each township, neighborhood and even parcel based on the taxing districts involved Alan Zielinski, Boone County Chief Assessment Officer 16

17 Property Tax Definition #2 EAV: equalized assessed value. Total taxable value of a parcel after application of the county, Board of Review and state equalizers. Takes exemptions into account Alan Zielinski, Boone County Chief Assessment Officer 17

18 Property Tax Equation #1 Tax Rate = Levy/EAV. % of total 5.5% 79.6% 69.8% 4.3% Property taxes primary intent is funding education Alan Zielinski, Boone County Chief Assessment Officer 18

19 Property Tax Equation #2 Property Tax = Net Property Assessment (property value minus exemptions) * Tax Rate. Parcel s fair cash value = $318,000 Parcel s assessment = $106,000 Homestead exemption = $6,000 Property tax = $106,000 - $6,000 * = $9, Alan Zielinski, Boone County Chief Assessment Officer 19

20 Assessment Process Parcel Number Township Assessor CCAO Board of Review aa-bb-ccc-ddd Determines $ some value Equalizes $ some value $ some value perhaps appealed and equalized Three independent assessment levels. Township Assessor (determines value). County Chief Assessment Officer (ensures statutory compliance). Board of Review (has the final responsibility for every parcel s assessment) Alan Zielinski, Boone County Chief Assessment Officer 20

21 Assessment Definitions 35 ILCS 200/9-145(a): how much? Each tract or lot of property shall be valued at 33 1/ 3% of its fair cash value. Determined by township assessors and reviewed by the CCAO, the Board of Review and the Department of Revenue. In Boone County, the township assessors determine value Alan Zielinski, Boone County Chief Assessment Officer 21

22 Assessment Definitions 35 ILCS 200/9-155: value on what date? "...the assessor, in person or by deputy, shall actually view and determine as near as practicable the value of each property listed for taxation as of January 1 of that year... Property is valued as of 1/1 each calendar year. Kudos to your County Board and township assessors Alan Zielinski, Boone County Chief Assessment Officer 22

23 Assessment Definitions 35 ILCS 200/1-50: Fair cash value: The amount for which a property can be sold in the due course of business and trade, not under duress, between a willing buyer and a willing seller. Not estate value, not divorce value, not mortgage value. All valuations must be for ad valorem purposes Alan Zielinski, Boone County Chief Assessment Officer 23

24 Assessment Definitions Fair cash value is usually synonymous with fair market value but However, the sale price of property does not necessarily establish its value without further information on the relationship of the buyer and seller and other circumstances (Ellsworth Grain, 172 Ill.App.3d 552,526 N.E.2d 885) Residential Real Estate Co. v. Illinois Property Tax Appeal Board. 188 Ill. App.3d 232, 241, 135 Ill. Dec. 611, 543 N.E.2d 1358 (1989). Translation: to qualify as a valid sale, it must be an open-market, arms-length sale Alan Zielinski, Boone County Chief Assessment Officer 24

25 Assessment Definitions Uniformity: noun. 1. the state or quality of being uniform; overall sameness, homogeneity, or regularity Accuracy first, uniformity second. Relativity applies to physics, not ethics. Albert Einstein 2017 Alan Zielinski, Boone County Chief Assessment Officer 25

26 Assessment Definitions Please note the definition of uniformity does not include equal. Illinois courts agree. We recognize that uniformity in the burden of taxation need not be mathematically precise. Apex Motor Fuel Co v. Barrett 20 Ill.2d 395, 401, 169 N.E.2d Alan Zielinski, Boone County Chief Assessment Officer 26

27 Assessment Definitions Uniformity does mean: 1. everyone is assessed at 33.33% and 35 ILCS 200/9-145(a) and 35 ILCS 200/ all similar properties use the same approach to determine their value. (Market, Cost or Income). Walsh v. State Property Tax Appeal Bd. 286 Ill. App. 3d 895, 222 Ill. Dec. 286, 677 N.E.2d 489 (1997), aff'd, 181 Ill.2d 228, 229 Ill. Dec. 487, 692 N.E.2d 260 (1998) Alan Zielinski, Boone County Chief Assessment Officer 27

28 Assessment Definitions 35 ILCS 200/9-210: equalization by the chief county assessment officer:...and shall equalize...so that the assessments will be at 33 1/ 3% of fair cash value. It s an adjustment to ensure equality across the county. An equalizer must be applied each year and can be greater than 1, 1 or less than Alan Zielinski, Boone County Chief Assessment Officer 28

29 Assessment Definitions Equalization: 1. is mandated by statute, 2. is state-, county-, township- or property-class wide, 3. raises or lowers all property within that category and 4. can even lower property taxes by increasing the EAV. (Tax rate = Levy/EAV) 2017 Alan Zielinski, Boone County Chief Assessment Officer 29

30 Assessment Definitions 2017 equalization by township: Belvidere: Multi-township: (Caledonia, Poplar Grove, Bonus, Spring) All others: (Manchester, Leroy, Boone, Flora) 2017 Alan Zielinski, Boone County Chief Assessment Officer 30

31 Please make sure you re getting every exemption to which you re entitled Alan Zielinski, Boone County Chief Assessment Officer 31

32 Exemptions Homeowner Exemption Senior Citizen Assessment Freeze Persons with Disabilities Exemption Disabled Veteran's Exemption Returning Veteran's Exemption Senior Citizens Homestead Exemption Most application forms and requirements are available on the county s web site. Exemptions are usually worth a lot more than an appeal (and take a lot less time)! 2017 Alan Zielinski, Boone County Chief Assessment Officer 32

33 If you believe things still aren t accurate or fair, appeal Alan Zielinski, Boone County Chief Assessment Officer 33

34 Bases for Appeals 1. Assessor error (deals with hard facts and should be resolved with the township assessor). 2. Recent purchase (does sale price, i.e., fair market, really equal fair cash? ) 3. Inaccurate market (fair cash) value. 4. Unfair assessment (equity). 5. Matter of law (requires a legal brief with case law citations) Alan Zielinski, Boone County Chief Assessment Officer 34

35 Procedure for Appeals Appeal assessment, not property tax. Your appeal is to the county Board of Review, not the township or CCAO. Must follow all Board of Review rules. Rules and guidelines on our web site. 30-day window (per statute). Preliminary decision or hearing (five days to respond per Rules.) Can appeal to the PTAB Alan Zielinski, Boone County Chief Assessment Officer 35

36 Appeal Considerations Based on evidence not opinion. 35 ILCS 200/16-80: reduced assessment of homestead property. 35 ILCS 200/16-185: PTAB s application of the same premise. Regarding uniformity appeals: Apex Motor Fuel Co. v. Barrett, Illinois Supreme Court. "A practical uniformity, rather than an absolute one, is the test." 2017 Alan Zielinski, Boone County Chief Assessment Officer 36

37 Appeal Considerations Please provide hard, compelling evidence Alan Zielinski, Boone County Chief Assessment Officer 37

38 Appeal Considerations Burdens of proof are upon the appellant. You realize, on a tie, you lose Alan Zielinski, Boone County Chief Assessment Officer 38

39 Appeal Considerations Court PTAB Board of Review CCAO Township Assessor 2017 Alan Zielinski, Boone County Chief Assessment Officer 39

40 Assessment Conclusions Levies and EAV are the main engines behind the tax rate that determines property taxes. The county equalizer affects all properties within a township, property class or neighborhood. It is not a multiplier. Its sole purpose is adjusting a township, property class or neighborhood assessment to the 33.33% level required by the Illinois Property Tax Code Alan Zielinski, Boone County Chief Assessment Officer 40

41 Questions? Issues? Thank You!!! 2017 Alan Zielinski, Boone County Chief Assessment Officer 41