Newsday Editorial helps explain tax increases

In case you missed this editorial.  The County assessor office tells the public to call his/her school district to expalin why their bill is more than the 2.18% voted on by the community. They control the assessments.

Newsday Editorial October 9, 2013  Mangano, taxes and the fun house mirror

Nassau County Executive Edward Mangano didn’t raise property taxes this year, but in the fun-house mirror that is the county assessment system, that picture is just a little skewed. Mangano’s efforts to deal with the county’s problems has resulted in higher tax bills for some property owners in order to balance the lower bills of others.

Mangano is under attack because tax bills being mailed now hold unpleasant surprises for homeowners who haven’t grieved their assessments recently. Their bills went up in every category, but it’s the school tax portion, at about 70 percent of most people’s total, that really startles.

School districts are operating under a 2 percent cap on annual tax hikes. That limit can be exceeded only with the approval of 60 percent of voters, and 55 out of 56 Nassau school districts stayed within the cap this year. But the average tax rate — the amount of money owed for each dollar of property value you own — went up about 7 percent this year. Overall, it’s up 20 percent over the past two years.

In almost every school district, the tax increase approved by voters last spring is responsible for less than one-third of the rate increase this year. That rate went up in districts because the total taxable value of the property in those districts has declined. That’s mostly because about 240,000 Nassau homeowners grieved their assessments over the past two years, and about 85 percent of them got a decrease in the value of their property.

Imagine you and your neighbor are an entire school district. Your houses are both worth $100,000, you each pay $10,000 per year in school taxes, or a rate of 10 percent. So the district has a total of $200,000 in taxable property and gets $20,000 in revenue from you and your neighbor. But you answered one of those solicitations from a company hounding you to challenge the claim that your house is really worth $100,000. You win, and your assessment gets cut to $60,000. The assessed value of property in the district suddenly goes down to $160,000, but the school still needs to collect the $20,000. So the tax rate increases to 12.5 percent. Your taxes drop to $7,500 and your neighbor makes up the difference. His bill increases 25 percent, to $12,500.

So, Mangano says he hasn’t raised county taxes, and he hasn’t. But steps he’s taken have led to higher bills for many residents.

To deal with the assessment monster, he decided to settle assessment grievances before tax rolls are finalized. Why? So Nassau wouldn’t have to refund overpayments to school districts and municipalities — a law known as the county guarantee — because the county made mistakes in assessments. His approach on settling grievances has saved Nassau about $60 million over the past two years, officials say, and eased some of the pressures on his budgets, which made it easier for him to hold the line on taxes. And while the percentage of assessment grievances approved is quite high, there’s no evidence they were without merit.

Mangano encourages homeowners to grieve their taxes, and the big winners are the lawyers who send the solicitation letters. The success of such a high percentage of claims, however, has caused large increases in the tax bills of residents who didn’t challenge their assessments. And the county tax burden, instead of being spread around evenly as it would have been if the county had passed a small tax increase, now falls most heavily on those who didn’t play the grievance game.