Home Owners are receiving their property tax statements this month. Many are probably seeing a drop in their property value, but seeing an increase in their taxes. How can this be?

The answer - Measure 50:

• Referendum Passed in 1997.
• Created “maximum assessed value”.
• Exempt from Constitutional provisions requiring uniformity in taxation.

Here are the important definitions to understanding your property tax statement:

• Real Market Value (RMV) – Amount in cash, Between informed buyer and seller, Without compulsion, Arm’s-length transaction, As of assessment date (January 1 of the tax year)
• Maximum Assessed Value (MAV) – Greater of 103% of prior year’s Assessed Value OR 100% of prior year’s MAV plus any “exception” MAV.
• Assessed Value – Lesser of RMV or MAV.

(For in-depth explanation)

EXAMPLE OF MARKET EFFECT ON ASSESSED VALUE

2008/2009 2009/2010

RMV    300,000     240,000

MAV    185,000     190,550

AV       185,000     190,550

NOTE THAT ALTHOUGH THE RMV DROPPED $60K, THE ASSESSED VALUE (TAXABLE VALUE) WENT UP 3% BASED ON THE MAV STILL BEING THE LOWER VALUE OF THE TWO.

2009/2010 2010/2011

RMV     240,000     180,000

MAV     190,550     196,266

AV        190,550     180,000

NOTE THAT THE RMV DROPPED BELOW THE MAV, SO THE ASSESSED VALUE (TAXABLE VALUE) WENT DOWN.

2010/2011 2011/2012

RMV     180,000     230,000

MAV     196,266     196,266

AV        180,000     196,266

NOTE THAT THE RMV WENT ABOVE THE MAV, SO THE ASSESSED VALUE (TAXABLE VALUE) WAS BASED ON THE MAV WHICH WAS $16K HIGHER THAN LAST YEARS TAXABLE VALUE.

Once you have the Assessed Value, the taxes are computed. The actual taxes owed is the Assessed Value (lower of the RMV or MAV) multiplied by the millage rate for your area. Millage rate includes all bonds and levies that are outside of the tax cap of 3% per year. The result is many property owners can experience large increases in taxes when the market values have dropped!

If you believe there is an error in your real market value (based on January 1 values), you can file an appeal prior to the end of the year. You may win a RMV appeal, but realize that if it is still higher than the MAV, your tax burden will not change.

For more information on the appeal process or forms needed use this link:  Appeals

If you have any questions, use the “ASK THE BROKER” button!

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Maintenance of Hillside Homes

All homes require a certain level of maintenance for general upkeep and to preserve the overall integrity of structures and land. Hillside homesites require some additional maintenance. Runoff, erosion, shallow soil sloughing, soil creep, and perched groundwater are the enemies of hillside homesites. If not properly controlled, these processes could adversely affect your or neighboring properties.

The primary source of problems on hillsides is uncontrolled surface water runoff and blocked groundwater seepage which can erode, saturate and weaken soil. It is therefore important that drainage and erosion control features be implemented and maintained in operative condition. By employing simple precautions, you can help properly maintain your hillside site and avoid most potential problems.

Here are a few Do’s and Don’ts suggested by geo-technical engineers:

Do List

1. Make sure that roof rain drains are connected to the street, local storm drain system, or transported via enclosed conduits or lined ditches to suitable discharge points away from structures and improvements. In no case, should rain drain water be discharged onto slopes or in an uncontrolled manner. Energy dissapation devices should be employed at discharge points to help prevent erosion.
2. Check your roof drains, gutters and spouts to make sure that they are clear. Roofs are capable of producting a substantial flow of water. Blocked gutters, etc. can cause water to pond or run off in such a way that erosion or adverse oversaturation of soil can occur.
3. Make sure that drainage ditches and/or berms are kept clear throughout the rainy season. If you notice that a neighbor’s ditches are blocked such that water is directed onto your property or in an uncontrolled manner, politely inform them of this condition.
4. Locate and check all drain inlets, outlets and weep holes from foundation footings, retaining walls, driveways, etc on a regular basis. Clean out any of these that have become clogged with debris.
5. Watch for wet spots on the property. These may be caused by natural seepage or indicate a broken or leaking water or sewer line. In either event, professional advice regarding the problem should be obtained followed by corrective action, if necessary.
6. Maintain the ground surface adjacent to lined ditches so that surface water is collected in the ditch. Water should not be allowed to collect behind or flow under the lining.

Don’t List

1. Do not change the grading or drainage ditches on the property without professional advice. You could adversely alter the drainage pattern across the site and cause erosion or soil movement.
2. Do not allow water to pond on the property. Such water will seep into the ground causing unwanted saturation of soil.
3. Do not allow water to flow onto slopes in an ucontrolled manner. Once erosion or oversaturation occurs, damage can result quickly or without warning.
4. Do not let water pond against foundations, retaining walls or basements. Such walls are typically designed for fully-drained conditions.
5. Do not connect roof drainage to subsurface disposal systems unless approved by a geotechnical engineer.
6. do not irrigate in an unreasonable or excessive manner. Regularly check irrigation systems for leaks. Drip systems are preferred on hillsides.

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