April 17, 2014 | Volume 44, Number 15

Assessor says accounts still a mess

The Haines Borough’s latest contract assessor says years of problems persist in the borough’s assessment system and resolving them may require establishing a department with three, full-time employees.

Marty McGee has been working since November to address problems he says include inconsistencies and inaccuracies in property descriptions and records, inadequate staff time devoted to assessments, and poor direction provided by previous borough managers.

Hired last fall, McGee is former chief assessor for the Municipality of Anchorage and has served as chairman of the State Assessment Review Board. He said his highest priority for creating the 2014 property tax assessments has been correcting inequities that resulted from last year’s valuations, which had some properties jump 800 percent in value.

The borough received more than 400 appeals last year as a result of former contract assessor Jim Canary’s valuations. And while those who appealed benefited from the process – many of the appealed assessments were adjusted by Canary – those who didn’t appeal were left with inaccurate valuations, McGee said.

McGee said his goal was to bring assessments “back to reality,” though he didn’t necessarily blame Canary for the inaccuracies. “Fundamentally inaccurate descriptions of the properties were the biggest contributing factor,” McGee said.

Because the borough in 2012 had received warnings from state assessor Steve Van Sant to get its property assessments up to “fair market value,” which is required by law, Canary took an “aggressive” approach to the 2013 assessments, McGee said.

 “Canary thought he had a handle on what values were in the community. He was very aggressive in trying to get to that place (of fair market value), on top of using property descriptions that weren’t very good,” McGee said.

The borough also maintains paper records and files on properties instead of using a computerized system. That means records that were unorganized, inconsistent, inaccurate and out of date, he said.

“I found records that are in pretty bad condition, and part of it is the borough has not been willing to spend the time and effort to maintain the database and records you need to do the job right,” McGee said.

Many of the records hadn’t been updated for years, he said. “We are visiting properties where nobody had been to those properties for 10 years. That’s a bad situation.”

A revolving door of contract assessors and managers hasn’t helped the matter, either, McGee said, with different leaders giving differing directions to assistant assessor Dean Olsen and using differing assessment methods.

“The deficiencies in the system are in no way attributable to Dean Olsen,” McGee wrote in a March report to the borough administration and assembly. “Mr. Olsen has been given different instructions by each assessor and either pushed aside or ignored in the annual process. Additionally, the directions given at different points in time were not consistent with modern appraisal or assessment practice.”

Olsen said this week John Wurst was the last on-staff, full-time assessor at the borough. Wurst retired in 2010 and worked for the borough for about five years. Prior to that, the borough hired another contract assessor who worked for a year or so, Olsen said.

In the report, McGee recommended several changes. One is to buy an electronic database and upload accurate record information from the paper documents into the system, a change the state assessor also urged.

In December 2012, state assessor Van Sant sent a 17-page report to the borough with stern warnings for the administration to make improvements in the department. The report, however, also absolved the borough of some responsibility, as it was trying to work toward fixing the problems created by a former contract assessor, Appraisal Company of Alaska.

ACA’s contract was terminated after it failed to meet many of the contract provisions. According to the audit conducted by Van Sant, ACA’s problems included “sloppy record-keeping,” “haphazard documentation,” “a lack of detailed notes,” and “lack of comprehensive sales analysis.”

ACA also was to help borough staff transfer 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, Van Sant determined.

Van Sant’s audit also confirmed Olsen’s apparent blamelessness in much of the disorder. Olsen was experiencing “an overload of duties” and “lack of adequate direction, and even misdirection at times,” Van Sant said.

McGee stressed the importance of modernizing the borough’s record system and having it easily accessible via computer. In addition to saving time and labor, it should also be married with the borough’s website so residents could get information about why their assessments have changed and how their assessments compare to other properties in the area.

The electronic database, called a computerized-assisted mass appraisal system (or CAMA system), allows the assessor to apply valuation models more quickly and accurately, McGee said.

Chief fiscal officer Jila Stuart said the borough has been looking at getting a CAMA system “for years,” but they are expensive, she said. Stuart said the borough was recently looking at a product package that cost about $30,000 “which is a lot less expensive than most CAMA systems,” but the company selling the product got bought out by another company and discontinued the product line.  

More recently, staff has been looking at working with the Ketchikan Gateway Borough about licensing a computer program it uses for assessments. Other small communities are also looking at this option, which allows municipalities to pay an up-front licensing fee instead of spending tens of thousands of dollars on their own systems.

Money for a CAMA or similar system doesn’t appear to be included in the draft fiscal year 2015 budget recently released by former interim manager Julie Cozzi. The budget for the assessment and land department would actually decrease by 3 percent if Cozzi’s budget were approved.

Cozzi and Stuart were both out of town this week and could not be reached for comment.

Another recommendation by McGee, which also doesn’t appear to be heeded in the recent budget, is to have three full-time employees dedicated to the assessments.

“Based on my experience, I believe that a taxing jurisdiction the size of Haines requires three full-time employees dedicated to the assessment task. One full-time assessor as department director, one field data collector/property inspector and one clerical support person,” McGee wrote in his report.

Cozzi did include an assessor in her budget this year and borough officials are encouraging Olsen to apply.

“One of your problems is there isn’t anyone full-time dedicated to the assessment tasks, because (Olsen) is also the lands manager,” Olsen said.

The borough’s uld have in a “crisis” situation, where the department had to deal with limited staff for one reason or another, McGee said.

“You can do that for about a year in crisis mode. When you do that repeatedly for 10 or 15 years, which is happening in Haines, the wagon falls apart. It doesn’t go down the road anymore,” McGee said.