207 E. Montgomery St.

This house, at 207 E. Montgomery St., was formed by combining three rowhouses but has been assessed as if it were a normal rowhouse one-third its size. (Gene Sweeney Jr., Baltimore Sun / January 20, 2012)

The imposing three-story home on the 200 block of E. Montgomery St.stands out from its more modest Federal Hill neighbors. The edifice, with 15 front windows and a gated driveway, is noticeably bigger and no doubt much pricier.

But you couldn't tell by looking at the property tax bill.

The government values the house — actually three Baltimore rowhouses combined into one — at $552,000, or close to what it values nearby two-story homes with less than half the square footage. Owner Blake Cordish merged one house with two adjacent rowhouses to create the mega-rowhouse four years ago, but on two occasions the state revalued his expanded home as if the renovation never occurred — giving Cordish an unwarranted tax windfall.

The state Department of Assessments and Taxation discovered its error after inquiries from The Baltimore Sun. The agency now says the correct assessment on the 4,600-square-foot home should have been at least $945,000 — a swing of nearly $400,000.

The mistake cost the strapped city government more than $10,000 in property taxes and casts a spotlight on an agency faced with a shrinking number of tax assessors handling increasing workloads. Those assessors, whose triennial valuations determine how much property tax owners pay, often set those values by looking at comparable sales figures, and without actually inspecting the property.

The revelation comes as other problems have come to light over property taxes. Earlier this month, state officials revoked tax breaks from more than 550 homes in the city, based on a Sun analysis showing owners had been improperly getting the homestead property tax credit on multiple homes. The owners now owe a total of $730,000 in additional taxes for the current year, a sum that could hit $3 million, counting prior tax years.

With Cordish's property, if an assessor had visited Montgomery Street to verify what was in agency files, one glance at the house could have revealed the problem.

"We do not have enough bodies to go out and look at every property every three years," said Robert E. Young, director of the assessments agency. Instead the agency looks for various "triggers," such as building permits that would indicate a rise in value. His staff also investigates complaints about assessments.

In an email to The Baltimore Sun, Cordish indicated he was not aware of the state's incorrect assessment of his property.

"I do know that I have promptly paid every penny of every bill I have received from the City and am proud to have been a Baltimore City resident for over fifteen years," wrote Cordish, an executive with the Cordish Cos. and son of prominent developer David Cordish.

Young suggested the Montgomery Street mistake was an isolated problem. "It's an odd account," he said. "It's not symptomatic across the system."

Yet it's hardly the only case where the state's files do not accurately reflect changes made to a property. Last fall, when The Sun asked Young about 20 city homes that received huge tax breaks, it turned out that five were too generous because assessors had failed to account for major renovations when establishing the homes' value.

State Sen. Barry Glassman, a northern Harford County Republican, said the error on Cordish's home does not surprise him. He said he's been trying for five years to create a statewide task force to review the assessment process, suggest improvements and make it easier for owners to appeal, but that Young's agency keeps quashing it in the General Assembly.

"They come in and oppose any effort to review or shed light on how these assessments are done or the interior workings of that department," Glassman said. "They do have a bunker mentality when it comes to transparency."

Larry Giammo, who co-founded a company that helps homeowners appeal their property valuations, said he has run into enough mistakes in state assessment data that he thinks the error on the Cordish property points to a larger problem.

"Mistakes may happen, but … with any kind of process or procedure, there's almost always going to be ways to improve," Giammo said.

His company, Property Tax Pros, recently released an analysis that questioned the accuracy of assessments in Baltimore and five large Maryland counties. The company looked at homes that were revalued in January 2011 and changed hands during the first half of last year. It found that one-third sold for either 20 percent above or 20 percent below their newly assessed value.

"That doesn't seem like an acceptable level of accuracy," said Giammo, a former Rockville mayor with a management consulting background.

Young defended his assessors, pointing to an analysis by the trade group Council On State Taxation that rated Maryland tops in the nation for fairness of assessments. He says errors should not take away from what he considers his department's quality work. Responding to Glassman's push for a task force, he noted his department has been through several prior studies and took issue with the proposal's details, such as membership and a time frame for reporting.