SOUTH BEND — Neighbors in a Granger-area subdivision near the Toll Road were shocked this spring to open reassessment notices and find the value of their property — and consequently the amount of property taxes they could owe next year — had jumped.
For one homeowner, it was about a 25% increase, and for another it was about 46%.
H Campbell (his first name is “H”) called the sudden increase “crazy.”
Nothing about the house he bought four years ago has changed, Campbell said, except the assessment, which went from $268,800 to $394,200, a 46.65% rise.
“Besides that,” he added, “we’re only a quarter of a mile from the Toll Road so there’s constant noise from the Toll Road, so if anything it should have gone down.”
Dan Brewer, who owns another house also on Covered Wagon Court, spent $7,600 for a new patio, stairway and landing on the back of his house and said his assessment went up by about 25% to $245,000, a price he maintains he couldn’t get for a 25-year-old house that sits near a “four-lane mega-highway.”
Both say they plan to appeal.
About 57% of the county’s 120,000 parcels saw some increase in assessed value this year, according to county assessor Rosemary Mandrici, while approximately 25% of parcels saw a decrease, and about 17% saw no change — percentages fairly similar to last year. About a quarter of parcels are reassessed every year, but other properties may also have values adjusted based on sales in an area.
“Real estate is selling in St. Joseph County,” Mandrici said. “It sold during COVID, too, if you’ve noticed. Realtors and real estate transactions are considered essential, and they’re selling.”
Potentially thousands of St. Joseph County property owners will be filing by June 15 to appeal an assessment they think is far higher than market value, though. In 2019, there were 6,461 notices for review filed with the county, up from 5,808 in 2018 and 4,026 in 2017.
The county’s number of assessment appeals has been high compared with other counties, and a data analysis firm that studied the issue made recommendations in 2018, one being to adjust assessments more frequently to avoid sudden spikes that spark appeals. Mandrici said her office hasn’t changed how it does assessments, but it does continue to work on one of the suggestions to update a land value study.
“The group didn’t tell us anything,” Mandrici said. “We actually explained how we assessed to the consultants.”
She said her office follows state requirements for assessing, and the state reviews and approves the work. Her office also has property record cards, sales study and exemption information online for taxpayers to use, she said.
The data firm that studied assessments also had said local governments and other entities were missing out on about $11 million per year in tax revenue because of assessment methods.
Its report in 2018 came as overall tax collections in the county were being cut by Indiana’s property tax caps. This year, because of “circuit breaker,” taxing units across the county will not be collecting nearly $115 million. Now, coronavirus promises to take a bite of more than $15 million out of income tax revenue next year for units across the county, a Ball State economist predicted.
The sharp rise in his assessment leaves Brewer feeling skeptical.
“If you need to raise my taxes a little bit because the county needs a few more bucks and it’s my fair share then OK,” he said, noting he might not have questioned a 10% rise. “But don’t try to make up all the shortfall from circuit breaker on my house.”
Beth Szweda, a former deputy county assessor and owner of Correct Property Tax in South Bend, a firm that handles commercial and residential assessment appeals, said she’s received a few dozen calls from homeowners since reassessment notices were mailed at the end of April.
Many calls have come from property owners near the University of Notre Dame, she said, where identical condos may be assessed quite differently and older houses may get “swept up” in increased assessments for nearby new or refurbished homes.
“Some of the newer homes also are being overassessed than what they are even selling for,” Szweda said, “and I don’t know why that’s happening.”
If an assessed value increases by more than 5% over the previous year’s assessment, the burden of proof is on the assessor to show the assessment is accurate, she said, which “sometimes they can’t because the data they’re using is not appropriate for the subject property.”
Szweda thinks the assessor’s office should lay out more of the methods and data it uses in order to make assessments more comprehensible for property owners. She also acknowledges assessing is tricky.
“It is a tough thing to do because everybody wants their house to be exact and it’s just not an exact science because you’re doing it on a mass appraisal basis,” she said.
Property owners who want to appeal an assessment need to file Form 130 by June 15. It can be found on the assessor’s web page by visiting the county website at sjcindiana.com.
Filing the form initiates the appeal, which may be resolved informally with an agreement for a revised assessment or formally with a hearing before the local Property Tax Assessment Board of Appeals or the Indiana Board of Tax Review.
Most appeals are resolved informally. Of the 6,461 notices for review filed in the county last year, 2,780 were informally resolved in favor of the taxpayer.
Formal hearings happen year-round but have been on hold since late last year because of the death of a board member and then because of coronavirus, Mandrici said. She plans to discuss with the board how to restart hearings as county offices begin to reopen to the public.
Campbell, the Granger-area homeowner who saw a 46% spike in his assessment, said he’s seeking an appraisal of his house in case he needs it for the appeal.
He said higher taxes because of the assessment isn’t the issue for him.
“We can afford it. That’s not a problem. It’s just the idea,” Campbell said. “It’s not right.”