Valuation issues linked to botched contract
Appeals to 2013 property assessments are pouring into the Haines Borough, and many concerned property owners are still seeking explanations for why their land values have soared by as much as 800 percent.
State assessor Steve Van Sant fielded questions from Haines residents on April 3 during a public meeting on “mass appraisal modeling,” but could only speak in generalities, to the frustration of several audience members.
Van Sant said he could not answer specific questions because he doesn’t know the area well enough, but that he had looked at contract assessor Jim Canary’s data and statistics and determined the model he used was appropriate.
“I am not advocating (Canary’s) values are perfect. We don’t know that; we don’t think they are. They will never be perfect because you’ve got too many properties that you’re dealing with,” Van Sant said.
Van Sant said while there were obviously some mistakes in Canary’s assessments, the purpose of the appeal period is to correct those errors. He also stated the model Canary used to determine assessment values was appropriate.
A model is a mathematical equation where various known variables (like square footage) are plugged in to determine an unknown variable (like market value). The method is used by assessors nationwide, particularly in municipalities with limited staff, so thousands of properties can be assessed at one time.
What is creating a major problem in Haines at the moment is not Canary’s method or model, but his unavailability to answer the flood of incoming questions from residents, Van Sant said. Mayor Stephanie Scott agreed.
“The mistake that was made is that Jim Canary is not here right now. Jim Canary, the assessor, should be conducting this Q&A. Jim Canary should be having these community meetings. Jim Canary should be available to the people who have received the assessment notice. Well, he’s not, because he was hired at the last minute, and he had this trip planned with his wife,” Scott said in an interview last week.
Canary expressed to Scott via email he was sorry for being unavailable. He will arrive in Haines April 13 and stay through the Board of Equalization hearings, Scott said.
Canary was hired “at the last minute” because the borough had originally contracted with another firm, the Appraisal Company of Alaska (ACA), to conduct the assessments. During an on-site audit of the borough assessor’s office by Van Sant and assistant state assessor Wendy Lawrence in August 2012, Van Sant determined the ACA “generally failed to meet a substantial portion of the contract provisions.”
Van Sant submitted his 17-page report on ACA and his recommendations to the borough in December. ACA failed to meet a laundry list of contract criteria, and problems included “sloppy record-keeping,” “haphazard documentation,” “a lack of detailed notes,” and “lack of comprehensive sales analysis.”
ACA, for example, was charged with assisting borough staff in transferring paper records to electronic records and implementing a computer-assisted mass appraisal system. However, ACA determined the electronic database system was “too complicated” and simply dismissed its use.
Chief fiscal officer Jila Stuart said the borough paid ACA $65,200 over about 18 months.
Manager Mark Earnest briefly addressed the issue with ACA during the March 26 assembly meeting. “There were some issues with the work that had been done, some severe problems. And so to make a long story short, that company was let go, and we went with the only other assessor who was available and who came recommended by Van Sant,” Earnest explained.
Regardless of what happened in the past, the borough needs to move forward and come into compliance with the requirements of the state, Earnest continued. “Our main purpose here is to get it right. That’s the bottom line. And I know this is more than an inconvenience; this should have been done however many years ago. It wasn’t. It wasn’t kept up and now we have two choices at this point: We could continue to ignore it or we could do something about it. And we’re trying to do something about it.”
Though Van Sant’s report focused largely on ACA, it also strongly recommended changes to how the borough runs its assessor’s office. Van Sant, for example, determined acting assistant assessor Dean Olsen was experiencing “an overload of duties” and “lack of adequate direction, and even misdirection at times.”
He subsequently recommended Olsen be placed under the direct supervision of the borough manager, and that the borough cease using Olsen as its land manager so Olsen could focus instead on assessment functions. (Olsen estimated he spends 75 percent of his time addressing land issues, and 25 percent on assessment duties).
More than 100 appeals have been filed with the borough so far. Administrative assistant Kathy Friedle said she has been fielding phone calls constantly since the assessments went out and can hardly even maintain the stock of available appeal forms.
“I keep making 20 copies every day and the 20 copies go out the door,” Friedle said.
Olsen said Canary has stated an intention to make site visits to every property that is appealed.
The deadline to submit appeals is 5 p.m. April 15.