This article will question whether outsourcing the 2012 Allegheny County property reassessments was the best idea for the residents of Allegheny County.
The Pittsburgh Post-Gazette recently questioned the fairness of the new 2012 Allegheny County property reassessments. The Post-Gazette review found that in Pittsburgh, expensive property values were underestimated as compared to lower-priced property values. This means more expensive properties were again, in theory, receiving a tax break.
The new report proves troubling since one of the primary justifications for the court-ordered reassessment was that lower-income properties were paying more than their fair share already. The problem is the mass appraisal system.
Mass appraising is not a perfect science. Instead, it creates a range where the success of the reassessment can meet industry standards for consistency and fairness, and still be unfair to certain areas and residents.
The results of the 2012 Allegheny County reassessment thus far are not unusual. National appraisal systems tend to produce similar results of favoring more expensive properties because mass appraising software can lead values to the ‘mean‘ value – (meaning lower-income values are raised and more expensive property values are decreased towards the center).
For the 2012 reassessment, Allegheny County utilized the services of a contractor named Cole Layer Trumble, a division of Dallas-based Tyler Technologies. The cost of the 2012 reassessment was an estimated 11 million dollars, but actual costs may ultimately be higher. In 2001, Allegheny County paid Sabre Systems, Inc. an estimated 30 million dollars for a similar service.
What I believe compounds the flaws of mass appraisal software is the decision by Allegheny County to hire non-residents of Allegheny County to complete the reassessment process.
Every time there is a reassessment in Allegheny County, there is chaos. With another reassessment allegedly scheduled for 2015, it is time that Allegheny County provides a strategy to handle future reassessments in a less chaotic fashion. Ideally, there should be greater accuracy so as not to discriminate against lower-income properties.
The solution is quite simple – start soon and keep it local.
1. Do not wait until the last minute.
If we are going to reassess every 3 years, we should start the next reassessment process soon. One of the major flaws with each of the last reassessments was that there was never adequate time to correct inequities found. Instead, the solution was always to fix the inequities through the appeal process. The appeal process though, cannot correct inequities of the appraisal software (favoring more expensive properties). We need more time and a thorough review prior to releasing any reassessments. The goal is to make any reassessments accurate, and that can only be accomplished by having enough time to perform multiple quality checks prior to release of the new assessments.
2. Keep it local.
Instead of outsourcing millions of dollars, Allegheny County should keep the reassessments local. Not only does it make more sense to spend the reassessment money locally, but it will produce a more accurate result. Allegheny County’s real estate market is too diverse to rely heavily on mass appraisal software.
Instead, the solution should include increased hiring of assessors, appraisers and real estate agents at the local level. Crtitics may argue that it would be cost prohibitive to have a reassessment division with local experts. I disagree. I believe it would be less costly to employ a full time reassessment division, with access to local experts, than it would be to incur a major capital expenditure every 3 years. This could only be done, however, if we allowed sufficient time to complete the next reassessment.
Allegheny County needs a better reassessment plan for the future. Our elected officials should not wait for the state legislature to act (which they never will), nor should they place residents in a similar position in 3 years. Instead, we need a strategy implemented now, that will create an in-house reassessment division that will spend our taxpayer money locally and produce more accurate results than mass appraisal software.
If you have any questions about Allegheny County property assessments, please feel free to call attorneys Noah Paul Fardo or Nicole Hauptman for help at (412) 802.6666 or email us at firstname.lastname@example.org.