This website is for the express purpose of providing Hanover County, VA residents with information they may need to determine if they should appeal their 2010 real estate tax assessment. This is NOT a Hanover County Goverement website. You can contact Hanover County Assessors office at (804)365-6029

Sunday, January 17, 2010

The Practice of Spot Assessing in Hanover County

Hanover County proposed real estate assessments for 2010 are done and notices were mailed on Dec 31, 2009 to property owners whose assessments were changed. According to the county assessor’s office there were a approx 10,500 changes out of 45,030 parcels. You can check here to see if yours was changed. If your address is NOT on this list your assessment was not changed. On the surface this does not look that bad. The problem is that many Hanover County property owners are not aware of is the practice of “spot” assessing that has been practiced in the county since 1993.

Each year the Chief Assessor, John W. Nelms, Jr.,a Richmond resident, reassesses only a fraction of the county's total parcels. That is called "spot" assessing and is done with the blessing of the Board of Supervisors and the County Administrator. The county is divided into “neighborhoods”. Some "neighborhoods" are stand alones and some "neighborhoods" are three or four subdivisions grouped together like, for example, neighborhood "140700" consists of Forest lake Hills, Knollwood and Pearsons Corner subdivisions which are combined into one "neighborhood" with 305 parcels.

When only a portion of the county is reassessed, it leads to unfair taxation since the equalization process cannot work as it was intended to work and the "roll back" tax rate is watered down by those who did not get an increase. The "roll back" rate is the rate necessary to offset any increases when reassessments average more than one percent countywide. If only a portion of the county gets reassessed - say 25% - then their increases are effectively watered down when thrown in with the other 75% of the county who did not get an increase. The roll back rate as a result is much lower than it would be if 100% of the county received increases. The last time 100% of the county was reassessed was in 1992 and the roll back rate was in the 23 cent range. It's only been a couple of pennies most of the years since.

A recent article in the Richmond Times Dispatch shows the inconsistency with the numbers compared to the fair market value and the other localities.

While the Virginia Association of Realtors says the average sale price for a home in the area fell 11.7 percent in the third quarter of 2009 compared with the previous year, the early word from Richmond and Hanover County is of single-digit-percentage declines in assessed values.

Though a decline in property values will squeeze county and city governments -- for which real estate taxes are the largest block of revenue -- assessors say they haven't changed their methods. They still are looking at every part of their communities and revising assessments neighborhood by neighborhood to reflect recent sales.

As a result of the reassessments, Hanover's real estate tax base is down 1.5 percent, or $200 million from last year, mainly because of a $195 million decline in assessments on existing homes, assessor John W. Nelms said.

Richmond is looking at a decrease of 5 percent to 6 percent, or $1 billion, in its tax base, assessor James D. Hester said. He said the city is doing final reviews before it sends out its notices late this month.

At current tax rates, that translates to a $12 million loss in tax revenue for Richmond and a $1.6 million hit to Hanover -- or about 1.9 percent of Richmond's total revenue and 0.8 percent of Hanover's.

Is Hanover County recession proof?

This year the problem is for the property owners whose assessment have not been changed for a couple of years or whose assessment was increased in 2007, 2008, 2009. These are the property owners who are probably assessed too high and needed to consider an appeal to the Board of Equalization (BOE), yet they received no notice from Hanover County and are not aware that the time is NOW to start the process.

A group of Hanover County residents with the support of the Richmond Patriots, Hanover Chapter are working to get Hanover property owners educated on the process of “spot” assessing and why it is not fair. Please note: we are not against paying property taxes, we only want the process to be fair. There will be an informational workshop on how and why Hanover Property owners should consider appealing to the BOE. January 30th, 2010 at the Mechanicsville Library 10am – 12pm.