Critics: Miami-Dade wants to make it harder for land owners to fight assessment hikes

By Francisco Alvarado, FloridaBulldog.com 

Miami-Dade Property Appraiser Pedro J. Garcia

Miami-Dade Property Appraiser Pedro J. Garcia

Miami-Dade property owners will find it much more difficult to contest their annual property assessments under a new guideline being considered by the Value Adjustment Board, a semi-governmental agency that mediates disputes between landowners and Property Appraiser Pedro Garcia, critics of the proposal claim.

Opponents argue the change, submitted to the board by Garcia’s office, violates both state law and rules set down by the Florida Department. Their reason: The appraiser’s office would no longer have to present evidence to back up how it arrived at a particular property’s assessed value. The higher the assessment the more taxes an individual or company has to pay even when the tax rate remains flat.

“It’s very important for taxpayers to have a process that protects their rights,” said Sheila Anderson, a Realtor who also specializes in property-tax appeals across the state. “If the property appraiser is allowed to write the rules, it tilts the scale in its favor. And it doesn’t comply with state law.”

Rafael Millares, the recently appointed general counsel for the Value Adjustment Board, or VAB, told Florida Bulldog that he is evaluating Garcia’s proposed rule change, as well as opinions submitted by attorneys who represent property owners before the board. Millares said he will likely issue his opinion on the matter after the New Year.

“I am new here so I have been doing a lot of research and going over what was left over from the previous VAB counsel,” he said. “So it is going to take a while. My plan is to produce a memo that conforms to the law.”

Lazaro Solis, Miami-Dade’s deputy property appraiser, dismissed critics’ concerns. “We are not doing anything that we believe is legally incorrect, unfair or unjust to a property owner,” Solis told the Bulldog. “Our attorneys say we are within our rights [to propose the change]. We don’t believe that this negatively impacts property owners in any way.”

In order to figure out each property owner’s annual tax bill, the property appraisers in every Florida county are bound by law to assess the market value of every parcel. An owner who believes a property has been given a higher value than it is worth can appeal directly to appraiser or skip right to the VAB.

Over the last two months, Anderson and real estate tax attorneys have been lobbying Millares to reject the property appraiser’s assertion that it only has to submit a property record card, which contains general information about a parcel such as sales history and appraisal values, and provide general comments about its assessment techniques.

State law violation?

In a Nov. 22 letter to Millares, Miami lawyer Jeffrey Mandler argued the property appraiser’s conclusion violates state law and administrative rules as well as Florida Department of Revenue guidelines and the statewide uniform 2016 VAB training manual. “Since 2009, the property appraiser had to provide written evidence demonstrating how it utilized and relied on income and sales and how it arrived at its value conclusion for the specific property,” Mandler wrote. “This would include the actual income analysis for the property and the sales it relied upon to assess the subject property.”

Mandler, who did not return two phone messages and an email seeking comment, claimed the property appraiser’s office now wants authorization to submit only “cursory” evidence to establish a “presumption of correctness” in arriving at a property’s market value. “This change is both detrimental to taxpayers and fundamentally unfair,” Mandler wrote.

In a Dec. 6 response to Mandler’s letter, Jorge Martinez-Esteve, a Miami-Dade County assistant attorney representing the property appraiser, disputed the real estate tax lawyer’s assertions. Martinez-Esteve said Garcia is only asking that Millares follow a guideline that his two previous predecessors accepted as sufficient for defending against owners appealing assessments.

“At any VAB hearing, the property appraiser’s office is only required to introduce evidence regarding the mass appraisal techniques used by the property appraiser’s office to arrive at the assessment,” Martinez-Esteve wrote. “The property appraiser is not required to introduce any evidence regarding the single appraisal of the subject property.”

Since Miami-Dade has more than a million properties, conducting single appraisals for every parcel would be impractical, Solis told the Bullldog. So the property appraiser’s office conducts mass appraisals, a process of valuing a group of properties through a mathematical analysis of market data, to determine a specific parcel’s fair market value, Solis said.

He added the property appraiser is not looking to make property owners pay more in property taxes. “If a reduction is warranted when we are reviewing a case, we offer it,” he said. “We are always looking out for the property owner. We don’t have a reason to go against them unless we believe the assessment is correct.”

Nevertheless, Anderson said the property appraiser is making it harder for owners to appeal assessments by pushing Millares to adopt its request. “Miami-Dade is a big place so they will make mistakes,” she said. “Now they want to come into a VAB hearing, wave a piece of paper in the air and claim they did everything correctly. That’s not showing evidence. It is empty rhetoric.”

Broward commissioner’s dad wins VAB contract; Higher pay than AG, justices, judges

By Dan Christensen, BrowardBulldog.org 

VAB members attend Monday's meeting. Commissioner Stacy Ritter, left, Mayor Barbara Sharief, Wendy S. Bodner with VAB counsel Monroe Kiar.

VAB members attend Monday’s meeting. Commissioner Stacy Ritter, left, Mayor Barbara Sharief, Wendy S. Bodner with VAB counsel Monroe Kiar.

With no debate, Broward’s Value Adjustment Board voted Monday to rehire the father of County Commissioner Martin David Kiar as its $225,000-a-year lawyer, without going out for competitive bids. 

The contract extension, for as long as five years, means that Monroe Kiar will continue to receive annual pay that’s tens of thousands of dollars above the yearly salaries of Florida’s Attorney General, Supreme Court justices, Circuit and County Court judges and administrative judges.

The 4-0 vote included Broward Mayor Barbara Sharief and Commissioner Stacy Ritter, both VAB board members. Sharief, Ritter and colleague Martin Kiar are all Democrats.

“I certainly have full confidence in your ability to do the job,” VAB chair Ritter told Monroe Kiar before the vote was taken. She will now negotiate a final agreement that will include a term of three years, with two additional one-year options.

VABs are independent authorities that hear taxpayer appeals regarding assessments and other adverse decisions by county property appraisers.

Monday’s vote closely followed the release of a critical audit by the Florida Auditor General’s office that raised questions about the independence and objectivity of VABs in Broward and other counties across the state. The audit said property tax appeals in those counties appear to have been rigged by local government officials more concerned in preserving tax revenues that fairly assessing home values.

Counties and school boards dominate VABs. Two county commissioners and a school board member serve on their boards. The county and the school board also pick the VABs two citizen members.

Monroe Kiar won a competitive process to serve as VAB counsel in 2009 while his son was a state legislator. This time, however, he’d asked the board to rehire him without advertising the post.

Legal services are exempt from county procurement rules. Still, the VAB’s vote to eschew a competitive process when hiring a county insider creates appearance issues that could become politically problematic.

State rules say VAB legal counsel “should avoid conflicts of interest or the appearance of a conflict of interest.” Kiar’s contract contains similar language.

Still, while serving as VAB counsel in 2012, Kiar was a member of a committee that held a re-election fundraiser for Broward Property Appraiser Lori Parrish’s husband, Geoff Cohen. Cohen is a Broward Circuit Court judge.

Kiar and his son, Martin, also contributed to the campaign of Parrish’s husband.

Audit finds property tax appeals in state appear rigged; Broward among counties cited

By Dan Christensen, BrowardBulldog.org agseal

A state performance audit of county boards that hear property tax appeals by unhappy homeowners and businesses says appeals appear to have been rigged by local government officials more interested in safeguarding tax revenues than fairly valuing real estate.

Value Adjustment Boards are ostensibly independent decision-making authorities where taxpayers can appeal a property appraiser’s assessment. Yet county and school board interests dominate them.

“Independence in the appeal process at the local level may have been compromised due to local officials involved in the process who may not have been impartial and whose operations are funded with the same property tax revenue at stake in the appeal process,” says the audit released without fanfare this month by Florida Auditor General David W. Martin.

“Rigged is the very word that a lot of people are using,” said Tallahassee attorney Benjamin K. Phipps, a veteran expert on property tax matters. “They rig it by making sure that the taxpayers don’t get a fair shot, though not in Miami-Dade because they have the only system in the state that’s really fair.”

BROWARD VAB TRACKED SPECIAL MAGISTRATES

In Broward, the audit says the county Value Adjustment Board compiled “tracking reports” on special magistrates who recommended large reductions in property assessments to the VAB and used them to get rid of six magistrates who had given the highest assessment reductions to taxpayers.

“These reports identified and tracked, by special magistrate, those special magistrates who recommended property assessment reductions that either exceeded 50 percent of the original property assessment or exceeded $200,000,” says the audit. The VAB used the information “when considering continuing the special magistrate’s service in the subsequent year.”

An unidentified former special magistrate filed a complaint with the Florida Department of Revenue, which oversees county VABs, exposing Broward’s practice in October 2012. Asked about it by the state, VAB lawyer Monroe Kiar responded that the practice was legal, “but did not address the issues of transparency and influence on the special magistrates,” the audit says.

Broward Commissioner and VAB Chair Stacy Ritter

Broward Commissioner and VAB Chair Stacy Ritter

Broward Commissioner Stacy Ritter chairs the county’s VAB. In an April 30 response letter to the Auditor General, Ritter defended the VAB and noted that it had discontinued the practice of targeting special magistrates last year.

“It should be noted that at all times the Broward County VAB has been transparent and has never unduly influenced the decision of any special magistrate,” Ritter’s response says.

“We all really believe they stopped that, of course,” Phipps said with sarcasm. “So how come the same guys (special magistrates) are still there?”

Property taxes in Florida make up about 50 percent of public education funding and 30 percent of local government revenues, according to the 20-page audit. In 2011, the latest year for which statistics are available, more than 140,000 tax adjustment petitions were filed in Florida.

The audit, however, doesn’t say how many taxpayers in South Florida and elsewhere were apparently overcharged, or how much in taxes were improperly collected by taxing authorities from cities, counties, school boards and special districts including the South Florida Water Management District. Likewise, the audit does not address whether tax refunds can or should be made.

As an example the mindset of VAB officials who place an “inappropriate emphasis on preserving property tax revenues,” the audit quotes remarks by Hillsborough County Commissioner and VAB chair Sandra Murman at a July 21, 2011 county VAB meeting.

“What you need to look at is the end game because every review costs us money (and) it affects the tax roll. We allow…millions of dollars to be taken off the tax rolls through additional review, the whole VAB process…” Murman said. “I think you have to kind of keep that in mind because as you know and I know where you are educating children, and I’m trying to take care of the needs in the county.”

AUDIT RECOMMENDS SHAKEUP

The audit recommended the Legislature consider a VAB shakeup to promote fairness for taxpayers who disagree with a property appraiser’s decisions regarding exemptions, classifications and value assessments. Its key recommendations:

  • To promote integrity, establish “rules of conduct or ethical codes, with appropriate sanctions,” for VAB members and staff, including clerks, attorneys and special magistrates.
  • Create a new process to appeal decisions by the VAB at the regional or state level.
  • Require that the majority of VAB board members not be government officials from the county or school board. Today, county VABs have five members: two from the county commission; one from the school board and two citizens appointed by county commission and the school board.

The audit, conducted between September 2012 and September 2013, examined 15 VABs across the state that it said were representative of small, medium and large counties in Florida. Broward, Miami-Dade and Palm Beach counties were included in the audit.

In 2011, Miami-Dade’s VAB saw, by far, the most taxpayer petitions filed – 91,519 – and granted 49 percent of them. In contrast, Broward’s VAB saw about 25,000 petitions and granted 18 percent of them. Palm Beach, with about 8400 petitions, granted 21 percent.

A central theme of the audit findings is that VABs often do not scrupulously follow state law or rules prescribed by the Department of Revenue, the state entity that oversees VABs.

For example, VABs aren’t supposed to hold hearings until their lawyers verify that it has met all legal requirements. Yet VABs in Miami-Dade, Palm Beach and nine other counties, couldn’t document for auditors that they’d made those verifications. Similarly, the Miami-Dade and Palm Beach VABs could produce no records showing they’d verified information supplied by their citizen members in written applications or oral statements.

DECISIONS WITHOUT REQUIRED INFO

Moreover, the audit found that VABs in Miami-Dade, Palm Beach and Broward had on multiple occasions issued written decisions that failed to include information required by law, such as findings of fact, conclusions of law and/or the reasons for upholding or overturning the property appraiser’s determination.

Attorney Benjamin K. Phipps

Attorney Benjamin K. Phipps

“Failure to include sufficient information in written decisions does not provide an adequate basis for decisions and does not promote fairness and equity in the appeal process,” the audit said.

Broward Commissioner Ritter took issue in her response letter with some of Auditor General’s recommended fixes, including the need for ethics rules.

“The Broward County VAB asserts that at all times its VAB members, special magistrates, members of staff, clerk and attorney have always conducted themselves in a high ethical manner,” Ritter’s response says.

“Broward County has concerns regarding the creation of a regional or state level appeal process,” Ritter said. She expressed similar concern about altering the composition of the board to lessen the clout of government officials on VAB decisions.

The county also doesn’t want to see a VAB citizen member or professional member sitting as the chairperson or alternate chairperson because they “may not have the same experience as a county government official or school board member would have in the chairperson seat,” Ritter’s response says.

But an “institutionalized” VAB is precisely the problem, said Phipps.

“Taxpayers go in thinking they are going to get due process and they come out very seriously disillusioned,” said Phipps. “The problem is when you have people who are depending on the tax revenues determining what tax revenues should be there is a tendency for them to be not all that interested in granting tax relief.”

Florida revenue department files, then yanks tax lien against Gov. Scott and First Lady

By Dan Christensen, BrowardBulldog.org 

Gov. Rick Scott

Gov. Rick Scott

Like 96,413 other Floridians, Gov. Rick Scott and First Lady Ann Scott were hit last year with a lien for unpaid taxes by the state Department of Revenue.

Unlike most other taxpayers, however, the Scotts’ tax warrant was voluntarily withdrawn, and the lien released, by state revenue officials one week after it was recorded with the court clerk.

The lien, filed at the Collier County Courthouse in the Scotts’ hometown of Naples, demanded $421.64 to cover interest and fees regarding delinquent intangible taxes that the lien document indicates were imposed following an audit. It was withdrawn on Feb. 11, 2013.

“The department has now determined this warrant was filed in error,” the document says.

The Department of Revenue administers a variety of taxes, including the collection of the intangible tax that was largely repealed in 2007. Department spokeswoman Renee Watters said nine warrants seeking payment of delinquent intangible taxes were filed last year, and that one was voluntarily withdrawn due to error – the governor’s.

Department officials declined a public records request seeking access to its file on the matter, citing the confidentiality of taxpayer records.

Watters, however, offered some additional information about what happened. She said tax warrants are signed through an automated processing system, and not individually by hand. She said the Scotts’ warrant was signed by general tax administration program Director Maria Johnson and that Ben Azu, manager of the department’s Naples service center, signed the release of lien.

“The warrant was withdrawn because we made a payment processing error,” said Watters. “Payment had been timely, but there was a lag in the deposit of the payment that made it appear that it was late and therefore, $421.64 interest was improperly charged.”

Azu declined comment.

The governor’s office said Gov. Scott spoke to no one at the Department of Revenue about the tax warrant before it was withdrawn.

“The governor’s office was not aware of DOR’s error, or the work to correct DOR’s error. The matter was handled by private counsel at the time, and DOR corrected its error,” said spokesman John Tupps.

Florida law allows taxpayers to authorize the department to divulge specific information about their account. But the governor, through his office, declined a request by BrowardBulldog.org that he authorize the disclosure of records regarding the issuance and withdrawal of the tax warrant.

The governor’s private counsel, named in the tax lien, was Cummings & Lockwood, a law firm with offices in Connecticut and Florida, including Naples.

The firm’s chairman and managing director is Jonathan B. Mills. He did not return a phone message seeking comment.

Why the Scotts’ were assessed intangible tax is not known. Florida’s intangible tax on personal property such as stocks and bonds was repealed on Jan. 1, 2007. The repeal, however, did not include a nonrecurring assessment levied on taxpayers who lend money secured by a mortgage on Florida property.

At the time the lien was filed and withdrawn last year, the top job at the Department of Revenue was up for grabs. Among numerous applicants was interim executive director Marshall Stranburg.

Gov. Scott and the three elected Cabinet members named Stranburg as the department’s full-time executive director on April 23, 2013.

Through a spokeswoman, Stranburg was asked whether the governor or a representative of the governor contacted him about the tax lien.

Stranburg did not respond.

 

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