Newsday’s Feb. 2nd expose by Matt Clark, “Mangano’s Overhaul Created $1.7B Property Tax Shift” was well researched and extraordinarily done.
It highlights the real estate tax burden shift from the informed and wealthy, to the struggling middle class and the elderly.
Far from “fixed,” Mangano’s assessment system is as broken as ever, and those who can least afford it are bearing the burden.
On the residential real estate side, a cottage industry of tax certiorari experts formed out of the dysfunctional assessment process.
These “cert” firms help citizens file real estate challenges through a painless one-page form, and they take, on average, more than a 40 percent cut of the savings for their efforts.
With a majority of tax challenges being conducted by these expert firms, the easy math tells you they have generated well over $500 million in profits of the $1.7 billion property tax shift.
Countless seminars on how to file a grievance are conducted annually by well-intentioned legislators and good citizens such as Jeff Gold.
This process is a big part of the problem.
The way it’s now done, the burden has fallen on residents to fight for fair assessments. Instead, government should be fighting on behalf of taxpayers for a fairer system.
The commercial tax assessment side is also a mess, as Nassau is mired in four separate lawsuits filed by business and commercial property owners.
The lawsuits stem from the county wanting every commercial property owner to file an income and expense statement by Feb. 10 or face stiff fines.
The businesses and property owners argue the County doesn’t have the right to enact such fines and the only point of them is to fill Nassau’s budget gap.
To make matters worse there is an over $300 million backlog of tax cert refunds owed, and they are collecting interest.
These tax cert refunds aren’t going to get paid off any time soon. Instead, they have become a drag on future budgets.
County Executive Mangano claims the system is fixed and his spokesman, Brian Nevin (in Kellyanne Conway alternative fact fashion) keeps repeating falsehoods that Ed Mangano has fixed the tax cert system and that everything is wonderful.
Newsday’s article explains in detail otherwise.
Here’s what’s needs to be done to fix Nassau’s broken tax certiorari system:
First, restore some of the employee cutbacks in the assessment department since 2010 by adding 50 employees, at a cost of just under $4 million.
Mangano has decimated the assessment office since he was first elected; morale is low and there is now way to get fair tax rolls without proper staffing.
With 423,000 taxable properties valued at over $264 billion in Nassau County, we need to have a reasonable workforce to effectively operate the assessment department.
Second, apply the most sophisticated valuation software available to help value property and also conduct extensive site visits to properly supply the necessary data for both residential and commercial property assessments.
Ineffective evaluation of commercial property has cost the county roughly 80 percent of the tax refunds.
As someone with an extensive background in both residential and commercial real estate, I can assure you — finding fair value of a property isn’t rocket science.
Third, reassess residential property every three years to keep valuations in line with a fluctuating market.
Also, don’t allow tax challenges in the second year of the cycle to slow down the flood of unnecessary grievances.
Petition New York State to pass a law that Nassau doesn’t pay a real estate tax refund unless property valuation is off by more than 7 percent.
Fourth, all commercial property owners must file an annual income statement so annual reassessments for commercial property can happen.
Keeping track of whether a property gains or loses a tenant is an important way to value a property quickly and effectively.
If an income statement isn’t filed there is plenty of leasing data available in every local market to aid in valuation.
Nassau County assessors should assume a building is 100 percent leased, unless an income statement is provided.
This will force commercial property owners to prove otherwise or be taxed at a higher rate.
Fifth, all future budgets must account for anticipated refund payments under a pay-as-you-go system, to avoid further ballooning of debt.
No more $100 million in annual borrowing to pay for refunds and mortgage away our community’s future.
According to the Nassau County website, as of April 30, 2016 there is over $4.3 billion in outstanding debt.
This is the highest county debt in the state, and a large chunk was created to fund a broken tax assessment system.
Long-term borrowing for yearly real estate tax refunds is a dangerous, imprudent practice.
Finally, the county executive must abandon his terrible plan to push the “County Guaranty” of tax certiorari onto smaller government entities such as the towns or school districts.
When several governments have to hire their own tax assessment staff, we will lose economies scale, and residents will ultimately pay more in taxes.
If Nassau’s 56 school districts had to each create their own assessment departments it would cost taxpayers roughly an additionally $25 million annually, to administer countywide.
When tax assessment is properly done, the county guarantee wouldn’t be an issue, as refunds would decline to a manageable amount.
Just fix the damn thing already!
