Concord’s City Council Should Vote No on Annual Appraisal

On Monday April 8, the city council will hold its second hearing and vote on whether or not to authorize the annual appraisal of real estate. If you haven’t been following this story, this years appraisal has resulted in significant tax bill increases for many commercial properties. In particular Downtown Concord and Penacook commercial properties.

While the new appraisal starts to shift the tax burden from residential to commercial properties, the methodology and results of this years appraisal are in question. Many of our downtown building owners will see tax increases (what they pay the city) in the multiple of thousands of dollars. While there are many questions as to whether the methodology used to assess these buildings was applied correctly, there is also the question of the timing of such a large increase.

One of the reasons our city assessor asserted that there was such a dramatic change in assessments is that the commercial sector hadn’t been reevaluated since 2008. Yet this comment seems to have little credibility, since 2007 - 2008 resulted in some of the highest real estate values our city has ever seen. And let’s remember that we have been told that the reason the city has been doing yearly assessments was to avoid the large spikes in assessments we are seeing this year. 

Here’s what I find when I go back and look at my residential assessments. 2008 was the first year I saw a decrease in my houses value after an almost 10% increase in value in 2007. And each subsequent year since 2008 to my present assessment, the value of my house has decreased according to the city.  And even though my house value went down in 2008 it was still the second highest valuation of my house in the 23 years I have owned it. 

Yet we are supposed to believe that commercial properties and businesses have faired so much better then the residential market that many of their building’s values have increased by 30% or more since 2008. Please.

Here’s what we are left with. A large spike not only in the value of commercial properties but in the taxes they owe the city. This at a time when both Downtown Concord and Penacook are going to go through multi year construction projects that will most certainly effect their bottom line. I find it difficult to believe that commercial property values have increased to the extent our assessors office claims, just as we are starting to extricate ourselves from the worst downturn in our economy since the great depression. And again let’s remember that the assessed values of these buildings were (or should have been) at record highs in 2007 - 2008, the last time our city assessor claims these properties were valued.

If the city council votes not to accept the annual appraisal, building values stay the same as last year. Buildings that have had a change of use and buildings whose physical characteristics have changed can still see changes to their assessments. And while tax liabilities can still increase or decrease (even when assessments remain constant) based on the city’s spending, having confidence that the value of their buildings will remain fairly consistent over the next few years will allow for commercial property owners to better plan and be able to meet their expenses.

I see only one option for our city council at their April 8, meeting. Just vote no. No to the acceptance to authorize the annual appraisal. New Hampshire’s RSA’s only require a reevaluation once every five years. While there may be a good reason not to wait until 2017 to revaluate properties in Concord, we should at least wait until after the downtown construction projects are completed before we start fiddling with assessments.