Assessor to re-appraise Vernon County commercial properties

Editor's note: This is the first article in a short series on the reappraisal by the county assessor's office of all of the commercial property in the county as mandated by the state tax commission.

By Rusty Murry

Nevada Daily Mail

Property owners sharing information with the assessor's office is important right now because Vernon County Assessor Cherie Roberts and her staff are in the process of reappraising every commercial property in the county. This appraisal comes about as a result of a letter received by the assessor's office on Jan. 12, 2011. The letter is from the State Tax Commission of Missouri and was sent to inform the assessor's office that the county is "out of compliance with State Tax Commission requirements."

Part of the reason this situation has risen is because of the lack of willingness to provide the assessor's office with the information needed to make accurate appraisals.

Roberts has more than 20 years in this field and has been the Vernon County assessor since 2000. She says that a lot of property owners have the notion that her office is a taxing entity, and that leads them to withholding information about their property that she or her staff members need to accurately determine the value of residential and or commercial properties in the county.

That, said Roberts, is the role of the county assessor. "My job is to discover, list and value properties in Vernon County according to the values here in our county" not in Joplin or Kansas City or somewhere else in the state but "right here in Vernon County."

Roberts said that when it comes to assessing commercial property, it doesn't matter what is sold in the building or what kind of service is performed, her office and staff are interested only in the property. "I could care less how many widgets you sell," said Roberts, "All I am concerned with is the value of the property and its buildings."

Roberts feels it is imperative for property owners to know that assessment is only about the property so property owners will be forthcoming with information that will make it easier to do her job and ensure that the completed appraisals and assessments are accurate.

The state made its determination after one of its appraisers conducted a bi-annual Ratio Study of a select number of commercial properties throughout the county. According to Shawn Ordway, Ratio Study Manager for the tax commission, the ratio study is "a limited analysis... a random sampling." Ordway also said, "what we're measuring are property values as of 2009."

The whole, assessing, valuing, and ratio study process is rife with numbers and measurements, percentages and technical jargon specific to the field. The average reader would soon be lost and confused while trying to decide what all of the information means to a property owner in plain terms, never mind trying to understand why the county is "out of compliance."

Roberts put it in simple and easy to understand language. The ratio study, which is done in odd years, appraised the properties differently than her office. Many of the 30 randomly selected properties were appraised at a much higher value by the ratio study appraiser. That means that the ratio of assessed value compared to the actual market value moved out of the parameters of the tax commission guidelines.

By statute the assessor must appraise a property as close to fair market value as possible. When that is determined, 32 percent of that value is used for taxation purposes. For instance, a commercial property owner whose facility has an appraised $100,000 market value would be assessed at 32 percent or $32,000 of that. That figure is sent to taxing entities. Tax rates vary according to which township, school district, etc. where a property is located, so properties of the same value in different parts of the county could be taxed differently.

After the Ratio Study Division of the State Tax Commission completed their initial appraisals of the 30 Vernon County commercial properties, it was determined that the ratio for those properties stood at several percentage points below the required 32 percent, thus the state issued its compliance order.

The state does allow for a margin of error. If the assessor's appraisal figures are within 10 percent, plus or minus, of market value then everything is well and good. If the percentage of the appraised value falls below 90 percent but above 85 percent of what the state appraiser deems market value, the county assessor receives a letter recommending that they re-examine their appraisals. When the percentage is between 80 and 85 percent, the assessor's office receives an order of compliance like that received by Roberts' office earlier this month. Any thing below 80 percent, and the state cuts the more than $50,000 in funding it gives to the Vernon County assessor's office each year.

Roberts states in a letter that in order to be in compliance, there will be an 11 percent increase in the valuation of some commercial properties in Vernon County. Before doing this Roberts said, "I'm having to look at every single property." As of now some have already been reappraised, but there are about 1000 commercial properties in the county, so it is a big job.

As dismal as the situation sounds it could be worse. It is a daunting amount of work to be done by an office with a small staff. And the percentage of the increase would have been much higher had not Roberts been fighting tooth and nail with the Ratio Study Division since this issue first came to light in the summer of 2010. That is when they did their ratio study and set this whole thing into motion, and that is where the next installment of this short series will begin.