So your property assessment notice came mixed in with the late holiday cards, but it didn't leave you with a warm, holiday glow. The state of Maryland says your house is worth more than you think it's worth, and the increase will be reflected in your tax bill in July.
Property owners who disagree strongly enough with an assessment to formally dispute it will likely number about 30,000 this year, state officials are predicting.
Still, the estimated market value used to calculate property taxes won't increase or will increase only slightly for most Marylanders, said Ronald W. Wineholt, who was appointed director of the state Department of Assessments and Taxation in February.
The state mailed notices Friday to 634,000 property owners -- a third of the state -- whose assessments will be phased in over three years. On average, assessments rose 3.8 percent. The state arrives at estimates of fair market value either by examining sale prices of comparable properties or by determining the cost of con- structing a similar home, less depreciation for age and condition.
More than 42 percent of the property owners will see no change or a drop in valuation from January 1993, when they were last reassessed. A quarter will see values rise by less than 5 percent. But the rest -- 33 percent -- face increases of 5 percent or more, Mr. Wineholt said.
Since 1991, state law has mandated that property owners can be taxed on increases of no more than 10 percent per year. Eight counties have caps of 5 percent and lower.
Market conditions typically drive changes in assessments. Some properties' assessments increased more than 5 percent because of major renovations or additions. Assessments also rose more in some rural counties, where prices have continued a slow, but steady, appreciation over the years.
In the late 1980s, when home prices rapidly appreciated, property assessments increased anywhere from 18 percent to 28 percent, peaking at 42 percent for the homes reassessed in 1990.
As home sales slowed and property values in many neighborhoods fell or barely kept pace, assessment increases have narrowed.
Average assessments remained flat in 1994 and rose by 1.9 percent in 1995.
"As in the past several years, most people are not going to see a great change as a result of this re-assessment," Mr. Wineholt said. "The average property is showing slow appreciation in value."
Volume of appeals
The volume of appeals has mirrored changes in assessment, dropping dramatically from a high of 66,842 in 1991 to 29,845 last year. Mr. Wineholt said he expects only slightly more appeals this year.
In Maryland, property owners can appeal assessments through three levels: the local assessment office, the Property Tax Assessment Appeal Board and the Maryland Tax Court.
Anyone considering filing an appeal should first request a copy of the work sheet used by the state assessor and a copy of the area's sales analysis, said John O'Neill, president of the Maryland Taxpayers Association.
Errors sometimes occur when assessors make incorrect assumptions about a home, Mr. O'Neill said.
For instance, he said he added sliding glass doors to enclose a breezeway at his home but was assessed for a room addition. He said he appealed and won.
In another case, assessors incorrectly described a Catonsville house as two and a half stories because of a floored attic, he said.
"They have no right to go in a house without permission, but they shouldn't make assumptions without asking," said Mr. O'Neill, whose group has affiliates in 15 counties and Baltimore that lobby for tax relief.
He also suggests homeowners get copies of the state's sales analysis to check homes used in determining market value. Comparable homes should be similar models of similar size in the same general location, featuring similar construction materials.
To appeal, a property owner must sign and return the form included with his notice by Feb. 12.
At the first level, a property owner presents his case to an assessor in a 15-minute hearing.
The assessment department suggests property owners focus only on points that affect the value of property, point out mathematical errors on the work sheet or inaccurate property characteristics -- such as the number of bathrooms or fireplaces -- and give examples of comparable properties. They should avoid making comparisons to past values or basing a case on percent of increase, the amount of the tax bill or properties in other taxing jurisdictions.
Property owners can file with the appeals board within 30 days of a final notice after a hearing. Further appeals can be made within 30 days to the tax court, an independent body appointed by the governor.
For the first time, the department has placed public access computers in land records divisions of courthouses and local assessment offices with assessment information on all Maryland properties.
Mr. Wineholt said the department has also begun distributing information through the Internet, via address http://www.presstar.com/sdat/.