A Panel Discussion of Developments, Trends and Issues Affecting Commercial Property Iowa Commercial Real Estate Expo

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A Panel Discussion of Developments, Trends and Issues Affecting Commercial Property

By Bryon Tack, MAI, CAE Polk County Deputy Assessor

January 1 : Assessment of property (appraisal date) Historical data from the previous 2 years is typically utilized for valuation decisions. Point in time snapshot. Board of Review has exercised their discretion on occasion.

April 15 : Assessment roll notices sent to property owner of record First class mail Appeal form may be enclosed Notice of January 1 st assessment amount

April 16 to May 5 : Appeals to county Board of Review accepted Must be in writing on the prescribed form Delivered or faxed Email or phone text not acceptable Dates are applicable every year

May : County Board of Review in session Session could extend through July 15 Decision can be appealed to District Court or to the Property Assessment Appeal Board Most properties now have a final assessment, applicable Jan. 1

Jan. 1 Assessment Date Apr. 16 May 5 Appeals to Board Of Review Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec April 15 Assessment Notices Sent May adjournment Board of Review in Session (Can t extend beyond July 15)

January 1 Assessment of property (appraisal date) If BOR changes the applicable date remains Jan. 1

July 1 Property tax accrual begins The accrual of the taxes that will be calculated using the Jan 1 st assessment

June 30 Property tax accrual ends County auditor establishes the levy rate based on the budgets of the levying bodies Property taxes become due July 1st

September 30 1 st half property tax payment considered delinquent after this date March 31 2 nd half property tax payment considered delinquent after this date

Jan 1 Assessment 1 st ½payment Considered delinquent After Sept. 30 2nd ½ payment Considered delinquent After March 31 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar July 1 Accrual of taxes Based on Jan 1 Assessment begin June 30 Accrual of Taxes ends

2006 Assessment 2007 Assessment 2008 Assessment 2004 2nd pmt 2005 1 st pmt 2005 2 nd pmt 2006 1 st pmt 2006 2 nd pmt Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar End of Beg of End of Beg. of 2005 accrual 2006 accrual 2006 accrual 2007 accrual

Number of days since July 1st Divided by 365 days = percentage of taxes accrued Previous taxes may work if no changes in assessment have occurred or are anticipated Current assessment applied against last known levy may be safer.

By Gregory P. Lynch, M.S., MAI, CAE Ames City Assessor

16

Sales used in Sales Comparison Approach Median Sales Ratio Study Equalization 17

10 th Appraiser Calling on Recent Sale Brokers & Associates Know the Real Story Brokers & Associates Unbiased Appreciate Appraisals 18

The primary tool used to measure mass appraisal performance is the ratio study. A ratio study compares appraised values to market value. In a ratio study, market values are usually represented by sale prices. Sales that don t represent open market, arm's-length transactions should not be used in ratio studies. Sales ratio formula: Appraised Value/Sales Price = Sales Ratio 19

Sale Number #1 - $104,000/$115,000 = 0.90 Sale Number #2 - $ 78,2000/$85,000 = 0.92 Median Sale Number #3 - $112,000/$100,000 = 1.120 20

Iowa Department of Revenue in Odd Years Median Ratio Range.95 to 1.05 Outside of Range Triggers All Properties In Class To 100% 21

100 / 92 = 1.087 % Increase Needed Aggregate Total AV X 1.087 = $ Amount Needed 22

By Bill Greazel, ICA, CGRPA Johnson County Assessor

Dale McCrea, ICA Muscatine County Assessor

Muscatine County Web Site http://www.co.muscatine.ia.us/

http://www.state.ia.us/tax/locgov/iowa property tax.html Iowa Property Tax About Us Assessor Education Board of Review, Local Credits and Exemptions Equalization and Rollbacks Forms Iowa Real Property Appraisal Manual Legislation Overview Policies Property Assessment Appeal Board Code & Rules Property Tax Study Committee Reports Sales & Statistics Utilities Links

Bryon Tack 515-286-2013 tack@assess.co.polk.ia.us Greg Lynch 515-239-5370 glynch@city.ames.ia.us Bill Greazel 319-356-6078 bgreazel@co.johnson.ia.us Dale McCrea 563-263-7061 dmccrea@co.muscatine.ia.us