A Taxing Process
The Dade County Property Appraisal Department uses a mass-appraisal system, dividing the county into a grid of one-square-mile areas that are examined for changes in property values at least once a year. County appraisers employ a variety of techniques to verify values: They examine recent sales, as well as sales in nearby areas; they scrutinize aerial photos, looking for improvements that may have gone unreported (a new fence, a built-on addition, a swimming pool); they analyze rental and occupancy rates for commercial property; and occasionally they visit a site.
Given Dade's 650,000-plus parcels of property, however, this system is fraught with error. Its underlying premise -- that properties within the same neighborhood will be of comparable value -- doesn't always hold true. As assistant property appraiser Frank Jacobs readily admits, "There are never two identical properties. You're always making adjustments to compare this one and that one."
To compensate for the sundry factors that turn one piece of property into a diamond and another into a dump, appraisers adhere to a formula known as "the three approaches to value," which takes into account the cost of replacing the property, the current market for selling the property, and the property's income. By law, government appraisers like the eagle-eyed staffers in the Property Appraisal Department must also follow a set of criteria laid out in the Florida Statutes. These rules are supposed to ensure uniform assessments, to guarantee that the value of each piece of property for tax purposes is determined in exactly the same way.
But because county appraisers physically inspect fewer than one in ten parcels each year, imaginative property owners seeking lower taxes have a virtually limitless array of arguments to justify their requests for tax exemptions or lower assessments.
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During this past year's appeal hearings before the Value Adjustment Board, for instance, one homeowner explained to Special Master Anthony Rolle that he had failed to file for a homestead exemption because he had recently moved and never received his tax notice. "Besides that I lost my job and I went under depression status," the man continued. "I couldn't eat. I was scared to go out. I am now suffering a kind of memory loss."
Homestead exemptions -- a perpetual $25,000 reduction of a property's assessed value -- are granted to all Florida homeowners who can show that a property is their primary residence. The petitioner qualified for the exemption, which was granted.
In a hearing room down the hall, Special Master John Dinda listened as the owner of a Miami River boatyard asserted that a highly publicized raid on a boat packed with Haitian refugees had contributed to the plummeting value of his property. Furthermore, the property owner said, there is a homeless encampment across the street: "Without armed guards you can't go down there after 6:00 p.m. because of all the homeless and the Haitians."
The representative from the Property Appraisal Department looked dubious and quizzed the boatyard owner about charges for unloading ships, for docking, and for storage. But in the end Dinda lowered his assessment by about $20,000, a tax savings of about $378.
The two cases illustrate what typically occurs at the two types of hearings A those for tax exemptions and those for reductions in assessed value. (Besides the well-known homestead exemption, Florida law specifies myriad other exemptions under certain circumstances: There are exemptions for religious groups, educational institutions, labor unions, historic buildings, widows, and handicapped war veterans.)
Hearings, which are informal and often last no more than ten minutes, are held in small, stuffy rooms on the sixth floor of Metro's Government Center. The special master sits at a table toward the rear of the room. Also present are a court reporter and a representative from the Property Appraisal Department. Property owners or their hired consultants, or both, wait on metal folding chairs set up in short rows in front of the table. When it's your turn on the docket, you approach the special master, state your case, and hand over whatever documentation you've brought with you.
There is an unpretentious, grade school-like atmosphere to the hearings. Nervous adults clutching briefcases fret about their assessments. The special masters, dressed in everyday office attire, seem better suited to the role of bureaucrat than to that of judge.
In fact, the selection of special masters is treated even more lackadaisically than that of your average government clerk. Each year the Value Adjustment Board (VAB), which oversees the hearings, places a newspaper ad for the special master position. Special masters who served the previous year must reapply. Frank Fernandez, manager of the VAB, and Steven Schultz, the board's legal counsel, screen the applicants. Those who make the cut are invited to interview before the board.
The board is made up of five members. Three are county commissioners, selected by their peers: Art Teele, Javier Soto, and Gwen Margolis. Two are school board officials, selected the same way: Robert Renick and Rosa Castro Feinberg.
The interviews are conducted en masse in the Metro Commission chambers and last about five minutes. Each applicant stands up, states his or her qualifications, and responds to any questions posed by board members.
It's not a particularly exhaustive process, and critics claim it is tainted by politics. After all, there is little to distinguish one applicant's qualifications from those of another. Special masters who hear assessment appeals are required to be either state-licensed brokers or state-certified appraisers with more than five years' experience. They also must be members of one of four designated professional appraising organizations. Only special masters who are also attorneys are allowed to consider requests for exemptions. Last year 7 out of the 28 special masters were assigned to hear such cases.
Although these are hardly rigorous requirements, agents who frequently appeal cases say the county maintains a general level of competency. "Dade County special masters are by and large very well qualified," observes Tom Post, one of the top local consultants who himself served as a special master in the Seventies. "Of course you always have a turnover, and there have been some problems with special masters in the past."
The county's docket of 30,000-odd appeals is divvied up among the special masters according to their area of expertise. Thus some special masters end up hearing primarily high-value commercial property appeals while others spend the bulk of their time ruling on residential properties. This is one reason Herb Parlato, deputy appraiser for Dade County, says it is so hard to evaluate a particular master's overall performance. There simply is no standard to measure whether a special master is granting excessive tax breaks or sustaining unfair assessments.
Property owners are likewise left without any concrete way of knowing whether they have received a fair hearing. In some cases they win a reduction that is only a small percentage of the total value of their property and is not nearly what they requested. Other times the appeal is approved in full.
A frequently heard beef from property owners and tax consultants is the limited time allowed to file appeals. Property tax notices are mailed out in August, and property owners have 25 days from the mailing date to file an appeal. "There's not a uniform date that people know they have to file an appeal on," grumbles consultant Tom Post. "And more importantly, they don't have enough time to file an appeal. Sometimes the hearings on the millage rates aren't even done by the time you have to file an appeal, so you don't know what your tax will be. That's wrong. That's just flat-out wrong!"
Once a taxpayer receives his notice, he has two options. If there seems to be something obviously wrong with his assessment -- his property is listed as having four bathrooms when there are only two, or as having a back-yard pool when there isn't one -- he can go directly to the Property Appraisal Department and ask for a reduction. If that fails, he can ask for a hearing. Or he can request a hearing straightaway.
Perhaps the most positive thing that can be said about the tax appeal hearings is that they pay for themselves. According to the county's figures, as of the first week in June, salaries and overtime for special masters totaled about $312,000, or about $12 per case, which is less than the $15 it costs a citizen to file an appeal. Cases continued to be heard through September and the final tax roll was certified October 18.
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