Board of Equalization Meeting   7/9/2024

There we go.

Thanks.

All right.

It's 933.

We'll call to order the Board of Equalization meeting for Albemarle County, July 9th, 2024.

Roll call.

All five members of the board are present.

We do have a quorum.

Members were absent.

Would the Albemarle County staff members please identify themselves?

Kelly Taylor.

James Schoet.

Thank you so much.

So I think you had distributed to you minutes from the last two meetings.

I hope everyone had a chance to look those over.

Are there any revisions or requested revisions to the minutes before we vote on them?

Few things ever left out.

What I emailed yesterday was before the revision.

There were only a couple of items.

What I printed there is the after.

Very good.

I appreciate you doing that.

OK. Is there a motion to approve the minutes from May 22, 2024?

So moved.

Second.

OK. All in favor?

Aye.

All opposed?

Okay, the May 22nd minutes are unanimously approved.

If everyone's had a chance to review them, is there a motion with respect to the June 24, 2024 minutes?

Thank you.

I'll second.

Okay, all in favor?

Aye.

All opposed?

Okay, the June 24, 2024 minutes are unanimously approved.

Okay, so then we want to address the proposed letter regarding legal representation for the reported utilization.

Lynn identified a mistake in the third line where mentions Karen Pape, a former member of the board, so that can be corrected.

Yeah, just, I don't think you need to say proceed with more confidence in circumstances, just say it could better permit us to better serve Alomarle County taxpayers.

That's it.

Unless anyone feels strongly about it, I'll cross it out of the spot.

Where is that?

The last clause in the first sentence of the second verb.

The third line of the sentence.

So we're getting rid of proceed with more confidence and circumstances.

Yeah, I think it said certain circumstances at once, but it wasn't much better.

So unless anyone thinks that that ought to stick, I would vote to strike that as well.

A period after taxpayers.

Yes.

Anything further?

Could I ask Mr. Lynch whether your office would feel comfortable printing that for signature?

Absolutely.

Delivery, I suppose.

Is the signature blocks as vice-chair as misspelled?

I think Vice Cherry is first here.

Vice Cherry.

Motion.

Is there a second?

I'll second.

All in favor?

Aye.

All opposed?

Okay, subject to those three changes that were identified, the letter will be printed and signed by the board and delivered to the Board of Supervisors to request legal representation specific to the Board of Equalization of Albemarle County.

I'll provide that to the county attorney's office and they'll get it into the system to the board.

Okay, thank you.

I think that brings us a few minutes late.

We won't hold you to the 20 minutes.

To Board of Equalization application number 60, by Kladaf for property address 5460 Stony Point Pass.

So we are the board of equalization.

We all had the materials that you submitted to the county in advance.

It tends to be most effective and helpful to us.

Big picture explanations for why the argument that you're making is supported by the evidence that you have.

Can you sign, swear me in or anything?

I'm not sure what I said.

Try to recall.

You saw him, and that's all of us actually.

Yeah.

Do you solemnly swear to tell the truth, the whole truth, and nothing but the truth, so help you God?

I do.

So you'll have 10 minutes to present.

There will be a seven-minute rebuttal by the Assessor's Office.

And then you'll have a seven-minute presentation.

So I'm actually here with four properties.

So some of this stuff should apply to all of them.

I want to first and foremost thank you for your time.

And let me check that my case.

I recognize a couple of you from some of your faces and I just feel like you must be sick of seeing me and I'm probably sick of being here but I'm here because the assessments don't make sense to me and I'm here for the answers to make that sense.

The Assessor's Office mission statement is create well-supported assessments that can be easily explained to customers and I'm here for that explanation for the change.

I've got a long history of working for non-profits.

I've worked for non-profits.

and I remember in one of them, one of them, particularly demanding about asking for data and I had a colleague ask me once, doesn't she drive you crazy?

And I said, no, I should be able to answer the questions that she's asking.

And so that's where I feel like I am here.

Like I'm looking for the answers to some of those questions.

So I'm going to start with a few givens.

Each of these properties is valued on its own unique attributes, just itself, right?

All four properties are in a 30% location adjustment area.

So they are already, all four of them, 30% higher than the county norm.

So that's where we're starting from.

I don't know when that happened, but that 30% has been applied as long as we loan the property, which we bought it in 2018.

Assessments are based on market data, another given.

In 2024, the county average for increases to our assessments was a little over 4%.

And in our specific district, Rivanna, the average was up a little over 2.5%.

the market data that was used for our properties included seven property sales and six of them were homes only one was a land land itself and I will agree there's a shortage of houses but there's not a shortage of undeveloped land undevelopable and three of these properties that I want to talk about are undeveloped so

I'm going to start with the big property.

That's the one you want.

That's 41.

That's our main house.

And I'm specifically talking about the property values here.

The property value for that house went up 20%.

20%.

Again, this is a property that's already a 30% higher than the norm.

And the average for the county and the average for our district was considerably, considerably lower than that.

So I don't understand how seven properties, six of which have a house, and only one of which falls into the same category as ours, which is residential and over 28 acres, could result in us having such a giant increase.

So I've provided comparisons for you.

I've also talked about the fact that

There are a number of surrounding properties around us on this page here that went down in value.

This is our same geographic area.

Most of them are under conservation.

I understand that that assessment

The tax value is different, but the property value itself shouldn't be going down if mine is going up 20%.

And then four of them go down, one of them went down 9%, one of them, the exact same footprint, down 5%.

This is inconsistent.

With this inconsistency, I mean, that's what I'm asked to prove.

When I first put in my original appeal, the answer I get back is that we looked at it and you know, you don't get what you want.

I don't have any answers as to why the data and the information I provided was not sufficient enough to make my case.

So that's something that I'm looking for.

This property over the last five years, the land value has gone up 103%.

103%.

I just can't believe you have market data that shows that land has gone up that much in five years, especially when I'm surrounded by properties that are going down.

And I'm also, this picture here is pretty telling.

We're surrounded by easements, surrounded by conservation easement.

And it feels like those of us who aren't under conservation easement are paying the price for these other properties.

We have properties here that have hundreds and hundreds of acres that are paying so much less.

And I understand that the conservation program doesn't apply to us, but I also don't feel like you have market data that shows that these little, these few spaces

are that much higher than the county norm.

Let's see, what else can I say about that?

I've showed you an example of an identical property that's considered less value.

So there's an inconsistency.

Yeah, I feel like the data is sort of speaking for itself.

That's my point.

If you've read this information, and if you have questions about what I came up with, I'd like to know.

Do you understand that the Board of Equalization is required to assume that the assessor's evaluation is correct, that it's the burden of the

I do understand that, but I feel like I have proved it.

I've proved it that there's not a lack of uniformity and I've proved it with the lack of market data.

So when you say that your property is

like the others that are appraised for much less or assessed for much less.

No, I specifically, because I understand that.

I understand that.

I don't agree with it.

I don't agree that 800 Acres gets

under conservation, because we the county residents, we're not necessarily all benefiting.

It's not public land.

It's somebody's private land.

It's them, but I can't, and the other people who are not under conservation can't keep going up and up and up and up to pay the county bills.

So yeah, I've picked specifically places that were not under conservation.

The only data that I use where I talk about conservation is this one here.

These are all surrounding, again, surrounding properties that went down.

I went up 20% and four of them are not under conservation.

So this is an inconsistency.

And the inconsistency makes you feel like the process is arbitrary, not nefarious, but not consistent

I have.

I shouldn't have.

I shouldn't have.

I should be treated fairly.

I don't like the idea of limitations on property I own.

and that provides a really significant limitation indefinitely.

And maybe I'm, I mean, right now we have no plans to do anything with that property but live there and have it be beautiful.

We did have a land use designation, and we will return to that, look into that.

We had, okay, it's a story.

We had forestry land use and our fault, we didn't really look into how that worked.

We bought the property, it had been abandoned and not lived in for decades.

It had been somebody's retreat house and then they passed away and house went to their four children and it stayed abandoned for decades and the land was never properly managed.

So when we bought the land,

You could not walk through there with a machete.

It was just invasive and terrible.

You know, a fire hazard.

The white ashes all falling down.

I mean, you could not literally walk through.

And so we cleared that out, not realizing that took away our forestry values.

So we ended up having to pay back taxes for six years.

So I understand that was our fault.

And we would like to do that again,

but just haven't gotten it.

This is all relatively new.

I'm not here to argue the land use and the fact that we had to pay close to $30,000 to make all that.

But I'm here to argue we can't keep going up 20% in just a year.

And the year before that, another 20.

Okay.

That makes me nervous.

First I want to touch on the conservation easements, non-conservation easements.

Properties under conservation easement are not assessed at market value.

The state

designates that they will be assessed based on land use rates with few qualifications, let they go under conservation easement, but they will be assessed at land use rates forever.

So there's no intention and there's a requirement by state law that they be assessed at land use rates and not at market.

So those properties, especially if they have no house and home site on them, are gonna be assessed extremely low compared to a market value property.

And there is no comparison that we can make that will support anything in defense of a market path.

The board is aware that the change over time is not something you can really consider for proving that an assessment is incorrect.

I'm going to step to the, because this is so firm, this video monitor, I'm going to step up there and kind of point a few things out, but when it comes to, this is a property in the market, what we call market area 211, and

within this market area, which I can zoom out in a minute and show you kind of the parameters where this market area lies, but within the market area.

So we set a home site rate and residual land value rates within that market area and

However, within the market area, there are differences in value.

And those differences in this market area are striking as you move away from Charlottesville.

And those differences are represented through a location adjustment.

So what you can't probably see from back there

said all of this says 1.3.

So this is the 30% that she was referring to.

It's not a 30% above the county norm or anything like that.

It's 30% as a land rate above what market area 211 space rates.

So these are 130% of that rate.

This is 50% above that rate.

So as you move closer to the city, and if I were to move,

The projector down, it will be 160, 180.

It gets quite high as you get closer to the city.

And then down here, it has some sections of 90%, 75% as you're getting away from the city and as you're getting off of the main room.

It's transect section.

So that's what all of these location adjustments mean.

They only affect the land value.

It's good to catch you when you try to zoom in and out for sure.

and the location adjustment areas.

So here.

Oh, neighborhood, sorry, yeah.

Correct.

So that 150 was actually a different period.

And these were established originally decades ago.

They're all to be all reduced based on.

Well, review them every year based on whatever information is available to determine if they need to be adjusted or not.

Anything else on the budgets?

So basically, to support this assessment, we provided comparable sales.

Here are a number of properties.

that are similar in different ways.

This is a rural area, so nothing's going to be identical, but we provided sales that show support for the property.

The increase

of the property.

The land went up 19.52, so the land went up 20% approximately.

However, the overall value of the property went up six points.

96%.

And as we talked before, when we're doing the reassessment in each one of these market areas or any of the neighborhoods, we're looking at kind of the balance of the land and the improvements.

And as we're looking at the sales that have taken place and the ratios of those sales, and we had seven

in this market area in 2023 in which we it's kind of our primary information that we base our information that we base our assessments on.

that we have to adjust either the land rate or the improvement adjustment or both, a combination of both.

And sometimes one will go up and one will go down or the both go up or only one of them will change.

We need analysis of the second paragraph.

It says the land value increased 19.52, the improvement value decreased by 0.63, and as it goes on, the last sentence, the average percentage change in the assessing district was 3.63, but it says some of the improvements went up, some went down in the area.

Overall, go up or down?

The overall total assessment of the properties within this market area went up three point.

How about the improvements?

The improvements, they would have been different based on what style of house they were.

And it really matters with all of those differences that we take into account when we're doing the analysis.

So when we're looking at the ratios of one stories compared to the ratios of two stories, some of those rates that apply to each one of those might change differently.

How about the land value do you take into account?

I'm familiar with this property and I know you do a lot of work cleaning up

That only affected the land use question.

It didn't affect the value of the land itself.

So it's just assessed by the acre regardless of what is on the acre.

That is correct based on the acreage but adjusted and I would have to look, adjusted possibly for topography and only if they had changed the topography in some way would we have adjusted the land value based on the work they did but I don't believe that was something that

that happened.

So it'll be based on the size, based on topography.

Yeah, there is a large topography adjustment for 25 acres of this property, this larger property based on water protection, floodplain area, where we've reduced it 70% with that.

and that's the only real adjustment we make.

There are two houses on this property, not just one.

So the second home site is a one acre home site.

We have a size adjustment on that, which typically two is the home.

Has that been renovated as well?

I'm sorry.

Has that been renovated as well?

2019.

Yes.

I believe that is all the information.

There were high tension wires on this property.

I was just going to say the property is right at the crossroads of the Lisa Road where it turns to Gordon'sville Road right at Cismont.

I just want to be clear that comparisons I used were not, other than the list, comparisons I used were not pieces under conservation.

I understand that conservation piece is not market value.

Thirty percent, that's that rate of value.

When I asked for information about how that 30% was,

It's established and how it's reiterated.

I've gotten information on the sales of that location, that area.

But you can't just list sales without comparing to other areas in the county.

So just saying that this is what was sold doesn't show that it should be 30% higher.

I'm not even going to argue that right now.

I'm going to argue this 20%

It doesn't make sense, and I think it again would be open to inconsistency, if you're adjusting home improvements and land to keep it relatively safe.

If the home has not improved and it has just aged and you haven't done anything substantial to it, it doesn't make sense that you could just raise it.

Now our home value, that improvement didn't go down.

The land went up 20% and that's what I'm here to argue.

I'm here to argue that there's not market data, there are inconsistencies in the application that don't support this 20%.

I mean, even just before coming here today, there was another piece of property that came across my purview.

It's just up to growth.

It's 123 acres.

The people that I know are thinking about looking at it.

And 123 acres, the land value is just half a million dollars, which is a little over 4,000 per acre.

It's just up stony point tax for us.

It's not under conservation.

It does have a land use, but the land use is only $50,000 of difference, but it's not under conservation.

So how is that possible that literally up the road from me, there's 123 acres that is valued at 4,000 and change of acres?

If the market doesn't clearly show that we should be 20% higher, then at a minimum, we should be in line with the area.

I think, no, it depends on what kind of improvements there have been.

I mean, if the... Well, let's say land, we're just talking about land.

If the land, it should go up with comfortable properties.

So if the land is...

The land is, say, undevelopable,

and Ashley Hughes should be considered one thing and it's good and developable and should be considered another.

I don't remember the address of it.

I could find out for you.

Quietude does it form up Stony Point Pass on the left.

It's probably longer.

It's right here, I think.

Right here?

What do you make of the assessor's

Well, six of them are houses, so that the house is driving the price.

Because let's face it, we all know we're in a housing shortage.

I got four grown children that can't buy a house.

So I would argue that these values are because they're homes.

There's only one that's just land.

And you can't do smart demand on one property.

It is, but I'm arguing the land value.

Land value.

These are all homes.

These are all residential properties that are less than 20 acres per parcel.

And our home falls in that 20 to 99 acres parcel residential billable.

So these don't even apply to them.

Only one applies to our county.

The very last one, 27.12 acres

that had a house and it sold for a million won.

I have a question for the successor to the number one that you provided.

What do you attribute the significant difference in advance?

Oh, I'm sorry.

So that one is right here.

Does anyone have any further questions on this one?

So I think we have a choice.

We can deliberate on each one, or I would suggest that to be efficient, it might make sense to let this applicant present on all four of our parcels.

All right.

Excuse me.

Mr. Mayo, I just wanted to add that Billy just calculated.

The total market area average increase.

So the answer is yes.

These criteria go together.

No, 58 and 61 are the two quarter acre lots, and 59 is the half acre one.

Okay, so you all know this, you've seen this property before.

The bills of law are targeted

42, you're all thoughts, is 0.1, 0.1 centigrade.

It's chock full of easements, equipment, and it's not a building we got.

The increase in value, 25% over last year.

Why did this, you know this piece of property.

We talked about it last year.

It's not a buildable lot.

And I have given, I think I'm gonna start with this.

Maybe I should just let you all explain it and then I'll shut this up.

I feel like I've provided more data than is necessary.

Teachers and girls, survey of it, girl's notes.

Yes, because that would be, no, that's not the $2,000.

Yes, I believe so.

It's a non-buildable piece of property.

A caponase is a 90 degree propagation.

Correct.

There was a building there.

Yeah, I don't know.

That was before my time.

But I have been told that this- It was a store, I think, maybe, at one time.

It was a home, and it was a multi-family home.

It was a single-family home that a multi-family was living in.

Okay.

And it burned.

I don't know the story on the top.

But the setbacks and the approval

who were grandfathered for that house, I have been told would not apply to this anymore.

So whatever was there because of history, you could replicate.

I read them and I think you should.

And, yes.

And last year, when I argued this, they said you have to submit a request and have it denied.

That's not fair.

to pay an architect and put in a request and pay the fee to put in a request.

Well, we have to be told no, we can't.

No.

Actually, we just bought the land because it was a trash site.

And because of all of the different assessments on it, I mean easements on it, all of the workers just parked there and it became just a parking lot and their lunch trash was there and

people would you know just there were trees that were falling there was an old well cap that was a that was a and it was an eyesore and it's the first thing you see when you are coming up to our property and so we bought it for more than we should have to just clean it up and we don't want to sell it i mean i don't know who would buy it

If you've been by that property, it's super, super busy.

It's getting busier now because we have a wine every now in the street.

Super, super busy property.

A telecommunications, B dot, Dominion, easements on it, big chunks of machinery that constantly home.

No one's gonna buy that property.

Not directly.

So sales.

I'm asking you to assess it as a half acre non-filled location.

You suggested five, is that what happened?

It's actually assessed as a home site, except it is extremely reduced.

What did you pay for that?

That's it.

I think I understand your argument that it's not buildable.

I think what I'm having trouble understanding is like,

Which of the reductions in value do you think ought to be cranked up further?

Because there's like six or seven layered diminutions in value for the problem that you're complaining of.

I think in the assessor's report, he notes all of the sort of, it's like the opposite of a magnifier.

But he's still taking it as a buildable property and then whittling away some of those things.

I'm saying it's not buildable.

What would a half acre that's not buildable be?

They reduced it but not to the level it should be.

What is the value of an unbuildable half acre lot?

That's irrelevant though.

But that, okay, taking that aside, what is the, what, that's my question.

What is a half acre unbuildable lawn?

$8,400.

$8,400?

$8,400 was assessed.

I'm not sure it's been determined that it's not.

It has not been determined.

That is not good.

Is there anything else that you wanted to add on this one, ma'am, before we give the assessor's office a chance to reply?

So

I don't always find it helpful that you have to provide a plan to community development for them to either approve or reject or provide.

But the reality is, and the truth is, you have to do that in order to figure out, especially in something this

complicated whether you could actually build a house on this or not.

And so saying that this is not a buildable site is not correct.

It has not been proven.

What I have up on the screen, which is, of course, hard to see, is that there is a possible home could be built here.

It's certainly not going to be a grand home like their property, but certainly

There is a market for a $28,000 home site to build a small home on in Albemarle County.

And if you could build it, somebody would build it.

Green area though.

That's the purpose where the building could sit.

Yes.

I hear it had a well head on it.

That I don't know.

I don't know the details of the construction of it.

They also control the property next door.

So they have the ability to do what they would need to do if they were to sell this.

And as Mr. Mayhew pointed out, they didn't pay $35,000.

I don't do a boundary adjustment incorporated with one of these other parcels we're getting ready to talk about.

They could.

And those other parcels are truly non-buildable and are assessed as non-buildable residual land, the same as if it was part of the larger parcel.

Those are basically

But we have to say, I mean, it has not been proven.

It's not a buildable site.

We assess it as a buildable site with huge reductions.

A buildable site at two acres would be $167,500.

We've reduced it down, of course, based on size, but also based on power lines, the restrictions, setbacks, all of that down to $28,000.

Or what is that about?

My rebuttal is, you know, have you proven that it was billable, but it also has been proven that it is.

So it's right here.

You're going to make me go through the process of applying to build on it.

And the other thing about it is it doesn't matter about the situation.

How did you- I was looking at other properties that are non-buildable, but then in comparison to the next.

And those properties averaged about $8,000 an acre.

And I figured a quarter of an acre, I don't know.

I'm based it on possible properties

Okay, so these are both a quarter of an acre.

58 is tab five and 61 is tab six.

Thank you.

65, 67.

What's that formula we just talked about?

Here's all the equipment for telecommunications equipment.

And then this one here is landlocked.

They're both a quarter of an acre in land value 19% and 20% respectively.

I've provided four examples of small lots that are in the area that

that show the lack of consistency in the land value increase.

If you just look at the comparisons I have, we've got one that dropped $200 in 2024, we've got two that had no increase in 2024, and we had another one that had no increase in 2024, and also hasn't had a change in assessment since 1997.

So these are,

Like this lot, these are properties within the area that are non-buildable.

Makes sense to me that there would be properties that fall in the same category that would be treated so inconsistently.

One of these properties, one that's most interior behind that farmhouse that's not ours,

has gone up 412% in the last five years.

It is an unbuildable landlocked lot.

It has to be looked at separately as its own entity and there's no way, there's no way that has gone up in value for more than 12% in five years.

OK.

So the front parcel, the one that's highlighted right now, has the easement of the equipment on it.

We reduced that parcel 30%, I believe.

is 30%.

These are non-buildable parcels.

We absolutely agree with that.

They're not being valued as buildable parcels.

They're just residual land.

And like I said earlier, they're valued.

Right, except the one is reduced for the easement on it.

For that residual?

The 25125 is the base rate.

Right.

$25,000.

Yes, that is the price per acre.

And then on the front one, you reduced it.

So this is 2.23 times $25,000.

and then it reduces another 30% because of the utility equipment.

That is correct.

Now both are increased 30% for the location, just like all the other problems.

It's 20, 25 plus 30%.

Correct.

Correct.

Times 0.7.

Or 0.7 for the front.

So, Thomas, just to understand.

I understand.

You have the house value, you have two acres around it that's at 100, a whole space per hundred for land for the home site.

That's how you do it.

With adjustments for any specific things for that property.

Then you plot the market area.

In this case, it would be 30%.

And then you take off for some of the larger parcel that she has, the 25% reduction in areas that are near Crete's.

environmental reasons.

It could be loads or 30% all the more generally.

That's an actual, where it's totally sitting on the site.

Correct.

Well, it's not that it's necessarily 30% of that acreage, that small parcel, is that what you're referring to?

It's that we're saying that the effect is to reduce it by 30% of the value.

It may or may not be 30% of the area.

Okay.

Yep.

For example, parcel 6346G, we're going to have an acre, has no increase since 1997.

I was specifically looking for small pieces of land with no house on them that are not under conservation and I was able to find four of them that didn't have any increase.

Have you tried to sell any of this land to a neighbor?

We didn't parcel this off.

I could, or I could just have a fair assessment and keep the lands.

I mean, if this were going up in a manner that I could make sense of, I wouldn't be here.

But I feel like the frog in the pot.

Like every year, it's going up 20%, 20%, 20%.

And I'm looking at the county averages and I'm looking at properties that are going down.

New boards of property back in 18.

How many of these parcels included in it?

They were included.

I'll tell you what, we didn't even know that.

And then we got a link bill because we hadn't been being billed for them.

It's worth more to you.

Why would you sell it?

You have protection on your property.

You put a lot of money into your property and it's, I'm sure it's well done.

But yeah, but the market and the market data, again, all houses, this is just one year.

It says 20% in just one year.

We're not talking, I mean,

I'm already paying the 30%, right?

So why am I going up 20% in addition to that?

And also, I don't know why that, you know, that desirable market

I would like to see the data for that in a comparison, not just a history of what's been sold, but an analysis that says on average, these properties, I don't think you can do it because we're surrounded by conservation.

I don't think the market would show you that you can say,

The market date has to be on what was sold and it has to be comparable.

These aren't comparable.

These are all houses with the exception of one.

Do you think that

Having a lot of conserved land around you is not adding to the value of your work.

I don't think that the market data shows that we are consistently 30% higher than other areas that are being sold.

So do you see on the fourth page of the assessor's report that- Whoopsies, I don't know that I have the assessor's report.

If you ask for all the documentation you used to determine your value, this is just a presentation.

Yes, but I was trying to draw your attention to the, to I think you're asking for is exactly what the assessor did.

He just looked, his office looked at all the sales in 2023 compared to the assessment.

And he's working backwards to check himself with that ratio.

And it's almost exactly one.

But his sales.

This market data was houses, it wasn't non-buildable land.

And I've given you four examples of non-buildable land that did not have any increase, one of them went down.

I guess the problem there is it's not selected in any way.

The data isn't sorted.

I'm telling you that doesn't apply.

Here's the problem with that argument, even if I accepted it.

Okay, so at the 30%, and give me $2,000 plus the 30%.

Well, the market area is fixed by the adjustment.

So I can't find unbuildable, quarterated lots in my market area.

The principle should be the same of in other market areas, they're not moving at all.

These types of unbuildable small lots that are landlocked or unbuildable, they're not moving at all.

And it should be that mine isn't moving at all either, plus my 30%.

I'm already paying more then.

So how would you adjust, just trying to understand how would you adjust the inputs to get to 2000?

What are you asking the assessor to do?

I'm asking the assessor to compare my property to like properties and comparable assessments to like properties.

Okay, I understand.

Thank you.

Is there anything further on either of those two partials that you wanted to share?

We haven't actually done our site yet.

Oh my gosh, sorry, it's okay.

So,

An issue when you're doing an appraisal or an assessment, you're looking at comparable properties, comparable sales, is determining whether they're really comparable.

So I've put on the board here, I'm going to come up to the board a second.

This is one of the properties this hospital has provided as a comparable.

It is a small strip of land with a driveway running through it and half in.

a floodplain, water protection period.

It's a very, I mean, talking about unbuildable, this is very unusable, except as the use of the driveway practice.

So we assess this as basically called marginal land.

It's a minimal value that just adds access to this property.

This is not comparable to the 0.22 acre residual land.

So we can look at another one that's very similar.

But the problem is, you know, what we've provided are similar in the same market area, right down the road, small non-buildable parcels and their assessments and they're very similar.

And those are the assessor provided comparables.

And they're very similar to these parcels.

We don't feel that these are being

misappraised or assessed in any way.

We don't believe that these comparables that Ms. Mossman has provided that if you use them would show a lower value, but they're not appropriate for her property.

They need to be more comparable to her property.

and all new information.

This would have been helpful.

And this is all in our area.

This is all 211.

We don't track how much things change typically.

Yours is 20, incomparable to the 19, 19, 20.

No idea why that went from 200 to 250% rescue calculation error.

Here's the problem with this though.

These all went up the same amount.

So you've taken these tiny little properties again and you put them all up.

I mean, but where's the sales market that shows these should go up?

Okay.

Well, hold on a second.

I mean, you made the exact opposite argument in support of your other properties.

You wanted us to look at what the assessments had done from 2023 to 2024 on the other properties.

But now you're saying that we can't use the assessments and that we can only look at sales.

They didn't go up.

So they are still the same as they were in 2023.

They did go up.

Now, I'm talking about my comparisons.

The only thing I could say is I just don't feel

that you have market data that shows that our land value should go up 20% and compared to sales in 2023 that had houses owned and that over the last five years, time to time again, our properties are consistently above

The average and the market.

OK.

Anyone have further questions for applicants?

OK.

So it's 1051.

The next hearing is at 1150.

So Ms. Mosman, we understand why you're upset that your assessment has gone up.

Everybody, I would like to pay less in property taxes.

I'm angry that my assessment goes up too every year, but we, you know, the assessor, you have to prove that they are wrong.

And I just don't see anything,

I agree with the ancestors methodology.

I mean, you know,

The way the best impact your tax revenue or your tax expenses is to lobby your drivers not to increase the rates or actually to increase the price argument for that too.

We can't take into account the percentage of increase.

I think on this one, application number 60, the argument that I found most compelling is that

criticisms of the assessor's methodology.

Even if we accept them, there's no better standard that we were offered.

There's not more compelling comps to accept, even if we disregard the ones provided by the assessor's office, which I don't think we should do.

I thought they were the more compelling set of comparable properties.

And it has the birth of proof to overcome the presumption of correctness.

but tend to agree that the assessor's office had done enough to defend the assessor.

OK, is there a second?

Second.

Is that it?

All right, all in favor?

All right, all opposed?

Okay, the assessor's assessment for application number 60 is affirmed.

This is application numbers 58 and 59.

We can deliberate on those together, but we should have separate fields for each, I believe.

These are the two quarter acre.

58 and 60, actually.

I sort of drew them together wrong in the binder, but yeah.

Two small ones.

Yeah, but a separate vote for each one would be.

Oh, I'm sorry.

58 and 61.

58 first.

I agree.

That might be offset by this.

I agree.

Is there a second?

Second.

All in favor?

Aye.

Opposed?

The processor's office termination is affirmed with respect to application number 58.

16161.

I think that's as well as the adjacent.

I move that the assessment be upheld and confirmed.

All in favor?

Aye.

All opposed?

But I have a little commentary on this one.

And then the increased assessment was across the board again.

So the introduction from last year was accurate, the right thing to do.

Yeah, I would say on this one, I tend to agree with the applicant that it is possible that this is not buildable, but that's not the standard of proof that I have to hold the applicant to, especially when there's correspondence from the planning office saying, you know, this could be buildable.

And if anything, it kind of weighs in favor of believing that it is buildable, even if there wasn't the presumption of correctness, which there is.

And so I can't vote in support of reducing it for that reason.

I don't think that fact was established.

And absent that, I didn't see a reason to challenge the methodology used.

I move we affirm the assessor's assessment at 28400.

Is there a second for a second?

All in favor?

Aye.

All opposed?

Thank you.

We skipped our earlier break.

Possible for us to take just 10 minutes.

Yeah, we've got time.

I'm sorry, I didn't mean to use that term.

You don't need to do that.

10 minutes.

Take a break.

We're back on the record and ready to hear the appeal from Board of Peopleization application number 29.

or 1700 Seminole Trail.

Oh, we have new people.

Yeah.

OK, very good.

So we'll need to swear in the witnesses.

and could you identify yourself for the secretary so that he can have the record?

My name is Michael Portillo.

Can you speak up a little bit for those of us who aren't hearing?

And I'll go for the recording so you make sure you project.

Okay, just to remind you, I'm sure you do a lot of these with different rules.

There's a 10-minute presentation period followed by seven minutes from the Assessor's Office and a three-minute rebuttal.

Thank you all for having me.

I'm representing CBS, located at 1700 Semmel Trail in Virginia.

It is a

It's Marshall Swift.

For the basis of our evaluation, we went with the average for the new construction, Class C, which gave us a base cost for a short amount of $130 million.

We also added $4.68 for sprinklers, which

We've added a current cost model of $1.020 and a local multiplier of $1,920 which gave us a final base cost per foot of $142.76 which gave us a base building cost of four site improvements of $1,000,000 in settlement quality and capacity.

After our site improvements, we added an additional $122,260, which gave us the total improvement site of $1,866,000 for depreciation.

Following that, we do have a depreciation of 7%.

for $30,620, which brought us back down to $1.7 million for a foot, and an estimated land value of $39.60, or $2,649,000, or $547,000, for a total of $4.3 million.

So I'm really arguing.

In fact, it's gone down.

We're just sorry to read that.

The appreciation should be taken into consideration as well as the average cost.

And I think the assessor has it at least.

We're using 139 for our basis.

If we're using a different number, that gives it a higher, a little bit higher.

So yes, we have a CVS pharmacy, 12,216 square feet, 5 through 6 acres of land.

It's at the corner of Rio and Seminole.

Our current assessment is $4,696,400, effective January 1, 2024.

And the main differences between our approach, which we also use cost, we also use Marshall Evaluation Service, the main difference between our approach and their approach

is the fact that we use a construction quality of very good.

They use a drugstore classification.

We use a retail store classification.

So we have a class C similar to those.

Our local multiplier is 0.85.

That's set by the assessor and is below the actual current rate for Charlottesville, Virginia.

and the site improvements we have are 62.6 versus their 122.160 and that's parking area of 25,135 square feet at 254 square foot depreciated at 2%.

Based on our classification as a resale store class C, very good.

The accrued depreciation is 4% rather than 7%.

We've used an effective age of seven years and an economic life of 50 years.

After depreciation is deducted, that's $82,600.

We have a depreciated replacement cost of $1,984,200 or $162,43 a square foot.

They haven't disagreed with the land assessment, so the argument for land is not necessary, but we did present on page four

of the document how we obtained the land value for this property.

We used Route 29 assessing district sales, which I've included a summary on page five.

The median adjusted base rate of these sales is $39.75 per square foot.

The land has been equalized for the district at $40 a square foot after adjustments for location and a corner influence were at 3960 square foot.

Yeah, I just want to add.

So as Deb said, the local multiplier that Marshall and Swift calculates for Charlottesville area is 0.92.

And that's what the tax rep used.

Just like residential properties, when we

We run the costs on all the commercial properties that we're doing by cost and we compare those to sales that took place in the local market.

We're able to kind of evaluate that multiplier and see if it's too low or too high.

At times we are above that.

Prior years, we were at 100%, because we didn't believe the 92% was appropriate.

And it didn't work for getting our assessments to 100% median, just like we do in the residential.

In this case, for this year, we're actually at 85%.

We're well below, 7% below, but Marshall Swift says, and what would be.

the tax rep used.

And again, it's just really it's a calibration of those costs for our area to make sure we're using it appropriately.

And it was kind of triggered by a very large increase in those Marshall and Swift costs over the previous years and not a big increase in the sales.

So we have to kind of validate that with the sales.

And as Jim pointed out,

There's a major difference, I think, in our evaluations, which is very small difference, as he pointed out.

is the difference between average and very good.

And if you look at the description in Marshall and Swift for what a very good looks like, it pretty much describes what this property is.

So I think that is appropriate.

Our multiplier is appropriate, which actually reduces the difference between those very good and average that the two levels are coming up with.

The difference between the retail versus using a drugstore in Marshall and Swift when you're calculating it, if we had used the drugstore use with everything else the same, we would actually come up with a slightly higher value.

I think it was instead of 4.6, it was 4.7 million.

So our use of the retail use

actually came up with a slightly lower value.

But the fact that we're using the lower multiplier and a higher quality is what causes it to be.

And it's about 7%, 8% higher than what the tax rate was going to be.

Do I understand then that the three main points of difference between the analysis is the kind of calibration factor?

Retail versus Commercial, and the last one is the condition.

And two of those actually flex in favor of the applicant.

That is correct.

Yeah, it's quality instead of condition, but yes.

So really, the battleground is just the multiple.

Thank you.

Have they used a pharmacy?

Is that what I heard?

Drugstore.

Is that your classification?

Yeah, it's more about design.

and because this is more specific, retail is just more general.

Would a drugstore be like a smaller store footage, first of all, instead of?

I don't think the size would really, no.

That's what I was going to say.

Because they really have changed over the years.

It used to be a standardized drugstore and that was it.

Now you can go in there and you can buy milk, you can buy candy, you can get the cards.

True.

and I would say that the difference between the retail and the drugstore uses using either one of them is probably the least difference of all the three things that we're talking about.

How about the depreciation?

So the depreciation will be affected by the quality of the construction.

It's affected by the quality construction but

You're talking about how the depreciation would be different based on drugstore versus retail?

No, they use 7% used food.

Yeah, so there's a couple of components that are used in determining what that depreciation would be, and it's strictly off of commercial suit tables.

If you're looking at a higher-rated property like we have, it typically has a longer life, so the depreciation would be lower.

for the same time period, for the same age.

I hear somebody say 50 years of life.

50 years of life, correct, for a retail store.

It would be 40 years.

Correct.

Okay.

Any further questions for the Assessor's Office?

Okay, do we have rebuttal?

Yeah, on the merchants that we were provided, the actual appraised value for the 2024-7 is 2.4 assessments, 4.7 million.

So that's what threw me off, 4.6.

I can tell you on the internal review, we had

Originally had four million seven one seven and upon the internal review we had reduced it to four million six nine six four hundred due to an adjustment in the effective age.

Yeah.

of it was, I think, set at four or five, something like that, versus seven.

So the value under appeal would be $4,696,400.

For newer builders, we use the actual age as the effective age until they reach an age where there's significant renovation.

And then of course the effective age could be extended, longer life.

So a lot of things change in the building.

At that point, it's more observation and how the property reacts in the market, how competitive it is in the marketplace.

But this is a fairly new building built in 2016.

Do you really use the little multiplier across all commercial buildings?

Yes.

It's interesting.

Why don't you divide it?

There probably are.

because you might get something, another type of building that might be at a 93 or a 89 for a multiplier.

Which is the, this is the lowest we've ever had on our multiplier.

Typically it's around 100%.

Anything further?

You know, the structural quality, which also changes the economic life of the building.

There's precedent in other counties at this point that it's accepted that it's an average drug store.

And that is why we agree based on even the assessments, that's something different.

Sorry, what do you mean by that?

That it's an average drugstore, what is it?

The construction, like in fact, this exact structure and other technologies,

I'm not sure I'm not sure what materials are you going to use to build this.

And this is commonly accepted across other communities at this point.

Does Marshall and Slift have some criteria to help you judge between average, good, very good?

County, not big on detail, but I can imagine part of that percentage of the exterior structure of the Steely Heights.

because a lot of those features are shared with average and very good.

It wouldn't have changed.

I don't, I don't think we would have changed it.

That is correct.

Freestanding.

The freestanding approach.

Freestanding.

Correct.

Retail.

And Class C. Yes.

Yeah, at all.

Oh, yeah.

They're on page four.

And they're all very good.

Correct.

There's some feature of this property that seems to distinguish it from the other three retail stores in the class.

The Assessor's Office is arguing that there's three other drugstores like this, or there are three other retail stores like this, and they all have the very good classification.

I do have one quick question.

On the chart under summary of 353, it says percentage good.

Which page do you want?

Just sorry.

Oh, percentage good.

I see it.

So that means that we are depreciating at 6%.

No, I'm sorry.

That's an 80%.

16% if it's 84%.

It just means it's a 16% depreciation.

The Class C is the?

That means it's Mason Reed.

Oh, okay.

A cinder block, something like that.

Any further?

Anything further from the applicant?

No.

I think that's treated the same.

Same classification.

Yeah, I guess I could believe that Albemarle is using too high of a condition versus everyone else.

But we don't have the data to say, other than anecdotally saying that property often gets good, average is said to be very good.

I move that we affirm the assessment at 4,696,400.

I'll second.

All in favor?

Aye.

All opposed?

Okay, application number 29.

We'll go to the firm and see if we can assessor's office.

So this is a Courtyard Charlotte site.

It's open since it's the 17th of December.

It's just minutes from the Charlotte-Shane, 20-mile airport.

It's a sprinkle room in the University of Virginia.

It's open since the 150th of June.

It's sort of vertical.

It's here.

What we're strictly arguing is the expenses to bring it back up to where it was before.

We're using the actions to figure out if it was 5% or if it was 3%.

We're not disagreeing with the income.

The evaluation difference we have is

We're using 7.6 million, we're at 6.1.

The difference only again with the expenses.

The expenses are at 77.7% for the disaster.

We're using actual expense of 81.35%.

You can see the historicals on page five.

Why do you say 81% when this is at the bottom of page 586-83?

81% of just gross.

What are those percentages?

Which ones are you excluding?

So we're excluding property tax, we're excluding lease payments, and also we're not including replacement reserves above the line.

We'll be missing something here because 2023, if you back out replacement reserves, lease payments, and property tax, it's about 7,500 plus 196 is 203,500.

Backed out of 3,250.

It's like 47,000.

We're missing like $20,000 somewhere from the expenses figure they're using.

That's 2023.

Why did we use 2022 for the provision of 2023 if we have 2023 available?

2023 wasn't available when we did the assessments.

So across the board for all income properties, we use 2022.

Okay, maybe I'll stop asking questions.

The argument is the operating expenses for this property and the 2024 assessment of $7,691,500 is correct.

We use the income approach for this property type.

We use the 2022 operating expenses because 2023 is not available for all properties in the market at the time.

Based on our 2024 assessment model, the management fee was

where it starts the discussion of the revenue and expenses.

And I put them side by side, the appellant for 2022 and the assessor for 2022.

The only difference in the revenue was we netted other income against other expense.

So that was a wash. And we made the adjustments as we mentioned, the management fee reduction and the franchise fees were removed.

I don't know why it was imputed, the franchise fee for this property, because it wasn't reported in the actual 2022 operating statement that we received.

The replacement reserve was 4% for all of the hotel properties based on our assessment model.

And then after deducting the reserves, we had a net operating income of 683,256.

They did not have an argument with the cap rate.

We present the cap rate analysis starting on page five and we use survey as well as sales to develop our cap rates for the model and this property is classified as a hotel grade three based on the hotel descriptions that are on page five.

So the cap rate is 8.75 and we have concluded at 7,808,600 including the furniture fixtures and equipment.

We extract the depreciated value of the furniture fixtures and equipment which was reported at 117,058 or 780 per room.

So that brings us down to 7,691,500

I just wanted to reiterate, Deb kind of went over this, but I want to make it clear.

African included that 111,000 in the 2022 statement that he showed, but the 111,000 was not in the statement that was provided to us in 22.

$2 million 886, 507, 3025, 014.

That wasn't included in the original.

It was not included in the statement that was provided, correct.

It represents what a chain brings to the brand and therefore the franchisee or... No, no, he asked about the management.

Oh, the management fee.

Oh, I'm sorry.

The management fee is a, we set it at three and a half percent.

It can be anywhere between three and six percent in the market.

Like any other property.

What quite often happens is if the owner manages the property, sometimes the management fee that they charge themselves will be higher than a market management fee.

No, we believe they shouldn't be included because they're not actual expenses.

They're just being imputed as, you know, the applicant is saying they should be included.

We say they weren't included.

They're not actual expenses.

They shouldn't be included.

So is the management fee an imputed expense?

They actually reported that it's just that the amount they reported was based on them paying themselves.

Well, management, yes.

That would be standard.

So was the franchise fee actually paid in 2022?

That's what I'm trying to see now, because I don't see it there either.

I'm not interested in that connection, but it's valid.

Well, we are almost in session, not including the franchise fees.

In fact, I'm thinking that.

looks like your management fee is six percent what is the how was three and a half derived

That would be the standard, as Deb said, we look at a standard range of these properties and what we normally would find for this type of property is three and a half.

We know if the owner actually is paying that amount to another entity that he owns or controls.

As far as we know, they manage the property themselves.

They own the property.

So when we're looking at other hotels, and those that are actually managed by somebody else, we look at those

And we use that.

That's where the three deck.

Can you get that from the market or from actual people here in this market?

Yes.

It would be based on.

How do you, so what about like, this is more relative to the apartments, shopping centers?

Same thing with those.

Gotta keep it local.

Yes, exactly.

There's published data by CBRE does a publication every year.

And they do ratios for various things.

So you can use that as a guideline overall, which works as well.

Are we saying that the franchise fee was not included, Rich?

Correct, on the statement.

Well, this is a certified copy of the statement from the owner, which indicates they paid no fee.

Yes.

You're saying you paid $111,000?

We'll calculate it.

I guess I'm a little troubled that there's no data here about where the three and a half came from.

I accept the assessor's statement that that's derived from other hotels, but there's no explanation for that number in the assessor's report.

Part of the problem is that we can't, while we can talk about the confidential information involved in this property because the suit is brought to you, we can't talk about the specific details of other properties in the market because that's confidential.

3.5 is more in line with the market, but then if there's no support for that, you know, I end up feeling kind of the problem is you could, if you own the property and you manage it, you can jack up that fee and make the property worth nothing.

Well, that's why I was asking, is there something other than what you get in the national

What does CBRE say?

How much is that?

It's pretty standard.

It does not change much over time.

But 3.5 is an investor who owns a hotel and pays Hilton to manage it.

Correct.

And then obviously, if they're not, then he can search for another management company.

So typically the amount will change over time as the revenue increases, because it's a percentage, but the percentages are pretty standard, unless you have completely different types of properties.

Esmont

Yeah.

This is the preview.

This is the 21 statement.

And it has 214,000 on the statement.

What we do with the total is I don't have the total of this.

But our

The process would have been to evaluate that page.

I'm not sure.

I guess what troubles me on that is you know suppose that he's not paying himself and it's just struck a bad deal with the third party he's overpaying for management he or she

I feel like maybe the property owner is sort of entitled to the poor performance that he negotiated himself.

You're referring to this, but I think the value of the asset market will pay for it based on the average and

But we sort of took the other position on that franchise fee.

But franchise fees can come and go.

They're not necessarily.

It bothers me to say it's not on the operating statement.

I can't consider it.

And then when there is a payment on the operating statement for 6% management fee to say actually we'll use 3.5% absent, at least some evidence that it is not an arm's length transaction on the management piece because the owner is paying himself off it.

Do you use your 3.5% regardless of what they're worth?

Yes.

Actually, our model says if it's above, if it exceeds 3.5%, it doesn't necessarily, it's below 3.5%.

We have done that on some properties, other types that we have run into that.

Well, I'm just wondering about

Correct.

Correct.

Yeah, I think where I land on it is like it's troubling, but I still think it's tossed back to the applicant to show that somehow incorrect.

I would be persuaded if the applicant was able to show that this was an arm's length transaction.

But absent that evidence, I think I just have to defer to them to what the assessor had done.

CBRE or some other, just include that as a check.

I mean, if you're within a certain range, like if somebody who studies the market puts something out that says it's three point,

So I'll make a motion to affirm the assessment.

All opposed?

Yes, enjoy your drive home.

How are you doing?

Hey, thanks for coming out.

I'll take care.

Thank you.

Thank you.

That's just lunch just for you guys, right?

Don't we get to miss these?

It's easy.

So.

Right.

We are back on the record.

It's okay.

I'll go ahead and swear you in.

He is an attorney who he would like to remote in.

Oh, sure.

What's he going to have to decide?

Maybe you want to allow that or not?

I'd like him to be here but also some of the items in the third part of what I'm going to discuss are technical and there's a legal aspect because of precedent and he may be able to answer questions and I can't so if you want to I've done this before we've done this in the city of Richmond

It's up to you, but up to the board.

I think

Do you do it on your phone?

Is that your proposal?

Wow.

I think you're committed to just answering technical questions about this third part.

Sure.

I'll follow up on that.

It doesn't make much of a difference to me.

Part of me says we ought to stick with precedent.

Another part of me says no one ever asked about this.

It's unlikely to be appreciated.

And if so, we could just make new policy.

use of income approach in determining value of real estate and the courts and one especially in the school.

The rest more management fee method is not a credible

It's somewhat of a technical argument.

It's not the primary basis of why we're here, but I want to make the point because it's how the law of accounting values details differently than how other real estate is valued.

And I think it would be helpful and instructive to you.

It's not intended to intimidate you at all.

It's simply he just is knowledgeable in areas I'm not.

And he's a good guy.

Mr. Smith was here last year, actually.

You met him.

And I think this would not be a good idea.

I would object to it.

The board is not able to change the approach at which we assess a property.

It was in the board of equalization training.

You can't decide that the cost approach is appropriate instead of the income approach when the income approach is used for every hotel.

So I think this legal explanation is not apropos to anything that you will be doing and therefore not be appropriate.

And Mr. Smith is not providing any valuation.

He's an attorney, he's not an appraiser.

You all can be the judges.

I mean, you're here to hear the evidence, hear the facts.

And so we agreed to restrict his involvement.

But he is an expert.

His full-time practice is tax, real estate tax assessments and appeals.

Well, the

And the fact that, and I'm not saying whether or not the assessor should use income or cost approach or a comparable approach.

I'm just saying that in this instance, applied to our property, certain conventions were used which are not equitable and not fair.

And that's what you hear the evidence on.

So to say that you don't want to hear that or don't want to listen to that,

When did you make this request, Mr. McFarland?

I didn't realize I was going to bring Shane with me.

I'm not persuaded that we should disallow it on the basis of the argument that he's going to make.

I think they're permitted to say anything they want and a lot of times people ask us to do things we can't do or make arguments that we can't consider.

I do, I am sympathetic or empathetic to the assessor saying that this isn't something that we typically do, that we typically do require to come in in person.

I think I would probably, my feeling on it is to disallow the Zoom participation or the phone participation, but not put any restrictions on the argument that Mr. McFarland could make to him.

This has been scheduled for a while, right?

I'm not inclined based on it.

I think we should create a record for Mr. McFarland of the decision in case he or his attorney wish to challenge it.

I would agree with that.

So I would move to deny Mr. McFarland's request to commit his attorney to participate by telephone for a portion of the

applicants, presentation, rebuttal period.

All in favor?

Aye.

All opposed?

Okay.

Mr. McFarland, do you swear to tell the truth, the whole truth, and nothing but the truth, so help you God?

You have 10 minutes.

In the three primary reasons that we exchange, and I'll introduce myself, I'm Charles

I'm a managing member of McFarland Stonefield, LLC, with the High Place Stonefield in Charlottesville.

I was involved in the traditional land, the development and construction of the building.

My brother is a co-owner and my father.

of the Blue Ridge Hospitality Group managed it.

We also manage other Hampton, Hilton, and Marriott products.

And I've been before this board previously, and I recognize most of you from this.

We strongly believe

I tried to characterize those in three categories.

In the first and most significant, because this actually cannot be computed, is that the highest

Brant, the assessor that she needs industry information to determine cap rates, determine values based on types of brands.