04/04/2011 Council Packet - Laserfiche WebLink

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Anoka County City of Lino Lakes We are aware that due to the time frames we are required to work within, it sometimes seems as though the assessor's estimated market value does not represent the market. It is lower than is should be during times of inflation and higher than it should be in times of deflation. The following chart illustrates the relationship between assessed values and actual sale prices and how the assessor's market values have been following the changes in the open market. Note: The Median Assessors Estimated Market Value represents the homes that are in the sales study. Price /Assesao 000 $230.000 $222ra,0 0 $210!,000 $200 010 $190.000 :._... $180,000 $170,000 __.. Median Assessed Value as it Relates to Median Sale Price (an'e:zrrren: year bass col closed ,ales frem the pray' Oct Lbw Sep, ror tax Gar'at'le the fo lo,,np •,ear) 76 $160,000. ... ..._ __ CO 2003 TAX j 6 20 0l a TA 2pr, TA �i 0 r:,`C Ob 7?� �10i Ts 2 08 7u2� 2009 TAX a.. 2071 TA 2 PAYABLE PAYABLE PAYABLE PAYABLE PAYABLE PAY ,u£LE PAYABLE ELE PAYABLE PAYABLE 20(4 2005 22006 2007 20,:t8 1009 2010 2011 2012 Median Sale Price -40-Median Assessor's Estimated Market Value As you can see, there is a point in time where the relationship between the assessor's values and the sales prices intersect. It is at that point in time that the market took a large downward turn. The following year, in response to that market condition, the assessor's values were reduced to reflect that trend. And we have responded with lower assessed values each year since as the market continues to decline. One last important point to make note of is that the assessment process is completed prior to the start of the budget process. The assessor does not adjust values in order to increase tax revenue. There is little correlation between changes in assessments due to market changes and how the resulting real estate tax changes. When we adjust assessments due to market increases or decreases, all properties are adjusted upwards or downwards. The only time that an adjustment in an assessor's estimated market value will have an impact on the increase or decrease in the resulting tax, is if the change in value is due to value added for new construction or value removed due to demolition /destruction of an improvement. Page 5