If you own property in Archuleta County, you’ll soon be receiving a Notice of Valuation from our County Assessor’s office. This valuation will be used to determine your property taxes for the next two years, and there is always a lot of confusion and misunderstanding about the valuation process. I get dozens of phone calls in my office every two years from people who think their valuation is incorrect. They’re mad and they want to protest. Some of these people have a legitimate grievance, and some do not. I want to help you figure out which category you belong in. We have a lot of ground to cover in this newsletter, so let’s jump right into it.
The County Assessor’s Office is charged with setting a value on every piece of real estate in our county. The process by which this value is determined is set by the State of Colorado. The local Assessor is required to follow the State’s rules.
As required, the Assessor’s Office looks only at sales that occurred during the “assessment period.” The current assessment period is July 1, 2008, through June 30, 2010. The county will not consider what your neighbor’s house sold for last week, nor are they allowed to take into account what your lot is listed for right now.
The county values land and structures separately, and then combines the two for an overall value. The county attempts to account for the property’s location and size along with variables like water frontage, mountain views, and other factors that can significantly change the value of the property. For structures, the county considers building type, condition, size, and several other variables. Additional buildings like detached garages, workshops, and storage sheds are also taken into consideration.
Once the valuation process is complete, the county mails everyone a Notice of Valuation. By law, these notices must be in the mail by May 1. Once you have received your Notice of Valuation, you’ll have the chance to appeal your valuation if you believe it is incorrect. Your Notice of Valuation will contain a form to fill out if you want to protest. If you are going to appeal your valuation, you must file your appeal no later than June 1. After June 1, you lose all rights to appeal the valuation.
I have dealt with many, many friends and clients who have appealed their valuations, and they have had varying levels of success. According to statistics provided by the Assessor, about one in three protests has been successful over the past couple of years.
Sometimes the county will make a simple mistake about what kind of property you actually own. If you are one of these people, you should definitely file an appeal. (Unless the mistake is in your favor; then you should probably keep your mouth shut!) Maybe the county thinks you own a 3000 square foot house, when your house is actually 2000. Maybe the county thinks you own 5 acres instead of 0.5 acres. These things happen, and the mistake will be easily remedied if you will play by the rules and follow the appeal process.
If you are going to appeal based on comparable sales, you’re going to have to do some research. The Assessor’s Office will be able to tell you what your valuation is based on. If you call or visit them, they can show you the details about your property that have contributed to your current valuation. They keep a list of all the comparable sales used to form your valuation, which you can examine upon request.
If you are planning to use your own comparable sales in your appeal, you need to remember that there are rules about what sales can be considered. The sale must have closed within the “assessment period.” The sale must be an “arms-length transaction,” which means that the buyer and seller must not have any prior relationship. If you have a copy of a fee appraisal performed on your property during the assessment period, it can be a useful tool in an appeal.
I always get quite a few requests to personally attend property tax hearings with some of my customers. Unfortunately, I am unable to do so. I simply have too many properties under my care. I am working very hard to bring buyers and sellers together, and I just don’t have the time to personally attend every appeal meeting.
If you appeal your valuation, the county has until the last working day in June to make a decision regarding your appeal. If you disagree with that decision, you have until July 15 to file an appeal with the County Board of Equalization. From there, you can continue on appealing all the way up to the state court system. I’d suggest you carefully consider the cost/benefit ratio before taking your case up to the Colorado Supreme Court.
The Assessor’s Office has reported that overall property values are down about 25% from two years ago. (This doesn’t mean that your property value is down 25%, or even that it is down at all. It’s just an average.) There are many, many bank repos in the mix for this assessment period, which are counted as comps and drag the values down. The property value you receive in May will be used to set your 2011 taxes. Property taxes are paid “in arrears,” so you’ll see a change in your tax bill during 2012.
One factor that will affect your actual tax bill is whether your property is residential or vacant land. Independent of the assigned value, vacant land is taxed at a rate approximately 3.5 times higher than residential property. This is due to a Colorado Constitutional Amendment which fixes the ratio of taxes paid by residential property owners. So, if you have a home valued at $100,000 and a vacant parcel valued at $100,000, the taxes will be wildly different even though the valuations are the same. Your taxes will be about 3.5 times higher on the vacant parcel.
If you have further questions about your property, your valuation, and your property taxes, I suggest that your first call be to the Assessor’s Office. You can reach them at 970-264-8310. They can show you the details and comps for your particular property. You can also click here to visit the County Assessor’s Website for most of this information. If you still have unresolved questions or concerns, please don’t hesitate to call my office. We have access to a great deal of real estate data, and we would love to help in any way that we can.
GRI, CRS
2011 & 2014 Realtor of the Year
Phone (970) 731-4065
Fax (970) 731-4068
Cell (970) 946-3856
Email: [email protected]
