Residents React to Tax Revaluation in Scarsdale

The results of Scarsdale's first tax revaluation since 1969 have been released and residents are busy evaluating their new assessments. Some are breathing sighs of relief while others are vowing to pack-up and put their homes on the market. As predicted, anecdotal data shows that homeowners on large lot sizes are seeing the most dramatic increases in their taxes, ranging from $25,000 to $50,000 per year with some going up by as much as $100,000 per year.

For most, the changes are not as dramatic, varying by a few thousand dollars in either direction. On a cumulative basis it appears that the steep increases to homeowners on larger lots have funded decreases to the owners of more modest homes.

The mailers that were sent to homeowners show the new assessed value of the home and what real estate taxes would have been in 2013 based on this new assessment. However, 2014 tax bills will be based on the old assessments. The best way to calculate real estate taxes in 2015, the first year the new assessments will be in effect, is to multiply the new assessed value by a factor of .02241%.

Village Assessor Nanette Albanese explained why the mailers and the 2015 projections don't match up. She said, "Because of the limitations of the NYS assessment disclosure system, and because people are demanding to know how to calculate their taxes, I have provided an ESTIMATED 2015 TAX RATE AND A 2015 TAX RATE CALCULATION on the Assessor's webpage. The number that I calculate on the assessor's page (.02241) takes the calculation out one more year to 2015 by inflating the 2013 levy another 4%, which I believe is much better way of getting to an estimate of 2015 taxes than is shown on the assessment disclosure notice, even though it's any one's guess how much the 2014 levy will increase. The assessment disclosure notice is a NYS document that is antiquated, most of which is hard-coded and, therefore, we could not change. There is an explanation on the cover letter that went with the disclosure notice, but I understand that it is wordy and people probably didn't read it closely."

What are people saying?

• Many have noticed that their assessments are $100,000 or $200,000 more or less than their neighbors on similar lot sizes with homes in similar condition? Why? It's difficult to know.
• Though Tyler Technologies assessed each home based on 17 characteristics, it appears that lot size weighed heavily in the equation. The bigger the lot, the higher the taxes, even if much of the lot is wooded or wetlands and is not buildable area.
• We've heard comments about location and noted that there seems to be little difference in assessments between similar homes on busy streets and quiet streets –though location is a significant factor in home pricing and buying decisions.
• Those who are facing large tax increases are questioning the basis of the new assessments. At the high end, there are few comparable sales and it's difficult to know how the assessor was able to define "fair market value."
• Those who are poised to get a decrease, are wondering why they were asked to subsidize their neighbors – sometimes at a cost of $5,000 a year in overpayments. Now that the new valuations are out, they are asking why they have to pay taxes based on the prior assessments for yet another year in 2014, further compounding their losses.

Will the cycle end? Though it was hoped that the revaluation would stem the tide of certiorari claims, the new valuations will undoubtedly stir a new wave of tax grievances. In fact, the Scarsdale Village Assessor has arranged for representatives from Tyler Technologies to hold informal meetings with the aggrieved at the Scarsdale Congregational Church during the month of April. If taxes on these properties are reduced, those reductions will be borne by the balance of taxpayers, pushing their tax bills upward.

Realtors have noted that sales of high-end properties, above $3 million, has fallen off of late... perhaps due to uncertainty about real estate taxes. Now that the valuations have been released, the sales prices of these homes could fall, spurring reductions in taxes on these homes. Again, those tax reductions would mean an increase for everyone else.

Incoming President of the Scarsdale Forum Bob Berg who championed the revaluation said, "I am speaking both personally and as Chair of the Forum Assessment Revaluation Committee. Property taxes in Scarsdale have been a particular fixation of mine ever since I moved to the Village in 2002, and over the ensuing years, I encountered many examples of egregiously unfair property assessments when I prepared for various tax grievances I filed against the Village in my effort to obtain assessments consistent with the changing market value of my property. In early 2010, former Mayor Carolyn Stevens asked the Forum to consider researching and drafting a report on property tax fairness in Scarsdale. I agreed to form and Chair the Assessment Revaluation Committee. After extensive research and analysis, the Committee determined that serious inequities had, indeed, arisen since the last townwide revaluation had been completed in 1969, and the Committee strongly recommended that the Village conduct a revaluation. The Committee issued a comprehensive report documenting the inequities and buttressing its recommendations, and our report significantly influenced the Village Board to proceed with a townwide revaluation. Notably, our report found the largest inequities in the treatment of larger estate properties in the Murray Hill/Heathcote estate area, with many of those properties being vastly underassessed based upon their market values. Although I have not had time to analyze in any depth the preliminary assessments just released by Tyler Technologies and the Assessor's Office, I have reviewed a non-random sampling of properties. To me, at first blush, it seems that the revaluation has largely corrected the inequities that I had found so troubling. For instance, many of the smaller properties I reviewed will see in decrease in their property taxes; others will stay basically the same. As we predicted, a number of the estates lining Heathcote Road will see dramatic increases in their property taxes (e.g., from $147k to $276k for one well-known property; from $151k to $217k for another; from $100k to $169k for a third). Another example is a house on 2.5 prime acres on Morris Lane of my friend who recently passed away who paid property taxes of $55k last year and would now pay $92k. Because of the ad valorem nature of property taxation in NY State and the zero-sum game for distributing the property tax burden, these wealthy homeowners were being massively subsidized, in many cases, for decades, by the rest of Scarsdale's taxpayers. Revaluation seems to have largely eliminated these gross inequities. At the granular level, however, individual property valuations arrived at by Tyler Technologies preliminarily may have issues. For example, I believe (unsurprisingly, I'm sure to some) that my property has been significantly overvalued in the revaluation – no property in my neighborhood has sold in that price range since 2006. Consequently, I will avail myself of the opportunity to meet with Tyler Technologies tomorrow night to discuss the valuation and to review the comparable sales upon which Tyler relied. If I remain unsatisfied, I always have the option to file a grievance between June 1 and 17. Overall, I think the revaluation process has worked very well. The appraisers have been very professional. Cooperation from Village residents has been unbelievable – I have heard that well over 90 percent of residents have allowed internal access to their homes which is unheard of. Tyler has been open and cooperative in setting up follow up meetings, and hopefully I will be left with a valuation I can live with. If not, I can always move to Christie Place."

As the tax role is a public record that is posted on the Village website, it is easy to see who's paying what. Here are a few interesting examples from the new tax role:

2 Cooper Road: Now on the market for $16.5 million the property has a new assessed value of $11,360,700. Taxes on the old assessment were $128,908. But now, with the new assessment, taxes on this 3.75 acre property are estimated at $254,593 per year.

18 Heathcote Road: This one is a puzzler. Though it's on 5.39 acres, the assessed value has dropped from $7.7mm in 2013 to $6.9mm in 2014. In 2013, real estate taxes were $188,000 but are now estimated to be $154,651 far less than other homes on smaller plots on Heathcote Road.

We compared two houses on the same street in Greenacres and noted a wide disparity in their valuations:

The first is at 3,689 square foot house with 6 bedrooms on .31 acres rated excellent overall. The house is valued at $1,375,000. Two houses away is a comparably sized home with 3,638 square feet of interior space, on .3 acres, rated "good." The second house received a valuation of $1,662,000, almost $300,000 higher than their neighbor. Though both paid $31,000 in real estate taxes in 2013, taxes on the second home will rise to $37,000 in 2015, for no rhyme or reason. Go figure!

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