News Column

Lower home sale prices hurt city tax base

January 28, 2014

By Tim Jamison, Waterloo-Cedar Falls Courier, Iowa

Jan. 28 -- WATERLOO -- City Council members were given a crash course Monday in the science of mass appraisal and real estate assessment. But Deputy Black Hawk County Assessor T.J. Koenigsfeld said Monday there's a much simpler explanation for Waterloo's falling tax base. "The number of sales are still there," he said. "People are still moving; they're just not paying as much as they used to (for houses)." Koenigsfeld was invited to a City Council work session to explain how the assessor's office sets assessed values -- the value used for determining property tax bills -- and to help explain why the city of Waterloo's total 2013 value declined more than $104 million from the previous year. The drop in value could cost the city more than $1.6 million in tax revenue next year unless council members raise tax rates. "The city of Waterloo had a significant devaluation in our revaluation," said Mayor Buck Clark . "There were a lot of questions about that. "I have a better understanding (now) of how we got to $104 million of (lost value)," he said. "The bigger question is why is that happening?" Koenigsfeld said the mass appraisal process compares home sales in a particular neighborhood with the established assessed values and makes adjustments to all of the homes accordingly. In many neighborhoods in Waterloo and across Black Hawk County , the assessor found homes were selling well below the assessed values. If the local assessor doesn't correct the values the Iowa Department of Revenue will issue an equalization order adjusting the values which will apply across-the-board to every property of a certain classification. "The state can issue equalization orders if we don't have a 95 to 105 percent ratio (of assessed values to sale prices)," he said. "Equalization orders are the most unfair way to assess property." Koenigsfeld said the adjustments to 2013 values were based on home sales in 2011 and 2012. But Clark and several council members said they were befuddled by the reason for lower sale prices given what they perceived to be improving conditions in the city and neighborhoods. Councilman Quentin Hart said he wasn't happy the assessed value of his house and others in the neighborhood were reduced given the effort he puts into maintaining his property. "It has something to do with other factors outside of your control," Hart said. "I'm really challenged by this." ___ (c)2014 Waterloo-Cedar Falls Courier (Waterloo, Iowa) Visit Waterloo-Cedar Falls Courier (Waterloo, Iowa) at Distributed by MCT Information Services

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Source: Waterloo-Cedar Falls Courier (IA)

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