Commercial assessments up 22 percent

Howard County - Owners of commercial properties in Howard County were in for a shock when they picked up their mail last week and found property assessments increased 22 percent over last year. The last commercial equalization order was passed in 2009 for a nine percent increase.

The raises will be assessed to the property taxes coming due in September 2018.

County Assessor Joe Kelly noted the Equalization order was issued by the Department of Revenue after it found commercial sales were much higher than assessment values in 2016.

Normally, the equalization process works with a minimum of 15 sales of commercial property, but Howard County only had seven commercial sales, which forced the Department of Revenue to send out an appraiser to randomly compare their appraised value with assessed value. For 2016, there were the seven sales along with 12 appraisals, which were used for the equalization comparison.

The 2016 median ratio for commercial property was low, at 82 percent. The acceptable difference between sale price and assessed value is 95-105 percent.

When the equalization order was first introduced to Kelly in August, it was at 31 percent, with which he was not comfortable. “I went down there Sept. 5 and met with the Department of Revenue to convince them to throw out one sale and three appraisals, which weren’t a good sale or appraisal. I was trying to get the percentage down lower, but they didn’t go along,” he said.

Trying to figure out the difference in recent sales versus assessed values, Kelly noted some commercial property along Highway 9 sold for much higher than expected. This included a property in Riceville that was assessed at $2,950 for 0.97 acres and sold for $143,000. Cresco also had two properties selling for considerably more than assessed.

“We really need to look at land values,” he stated, “but we’re always shooting at a moving target.” Land values fluctuate for many reasons. “We need to do some fine-tuning in the future.”

Since the Equalization notice was mailed out last week by the Auditor’s office, both offices have been fielding calls on the matter.

Kelly explained there is an appeals process. “A property owner can appeal to the Board of Review of Howard County from Oct. 9-31 to file a protest.”

If there are any questions, people can call Kelly at 563-547-9201.

Members of the Board of Review include Gary Kelm, Dan Ollendick, Chuck Malek, Gerald McGee and Kim Holthaus.

Going forward, Kelly’s first priority is getting commercial land valued properly. “We are planning on doing an in-depth study on land values and work on building values after that.”

Auditor Julie Chapman said a 22 percent increase in assessed value does not necessarily mean property taxes will increase by that amount. It all depends on the levies for the Fiscal 2019 budgets.

Levies can fluctuate according to the amount of need any entity has on the books. It seems obvious though that if the levies stay relatively the same, taxes will also increase for commercial properties.

Commercial was the only property with an equalization increase. Agricultural Land and Structures, Residential and Multiresi-dential received no adjustment.