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New property values could help appeals
There is a lot riding on the new values. County officials, swamped by a torrent of appeals last year, predict a revamped computer formula means property is assessed more accurately. If true, that will dampen the past year of political pressure. The new values, which climbed 11 percent countywide compared to last year, dropped in parts of the Mon Valley.
The first people to see notices mailed out Tuesday were about 6,000 people who are scheduled to have hearings in late January or early February. Next will come Pittsburgh residents, and finally, the rest of the county in ascending order of ZIP code.
"We have values that are very good this year," said Norm Mekkelsen, county Administrative Services director, whose offices have run both the 90,000 appeals for 2001 and the revamped computer model used for 2002.
The new formula goes beyond what was done by Sabre Systems & Service, a Dayton, Ohio, company that did the 2001 reassessment.
When the county real estate Web site is back online, which is scheduled for Thursday, every property will show five actual home sales used in the 2002 assessment formula, done by another firm, Cole Layer Trumble, of Exton. Also included will be every property's 2001 assessment for comparison purposes.
This new formula still has trouble with low-end properties in some of the most distressed parts of the county, where sales can be below $10,000, Mekkelsen said. There are slightly more than 1,000 such properties, out of more than 550,000 in the county. The county may have to modify the formula for 2003 to include a special code for areas considered "blighted," he said.
On the other side of the coin, Mekkelsen said the county has tackled a major problem from last year — that of higher-end homes being assessed for less than they are really worth.
"If you look at the increases and decreases in values, it is the areas with the higher-valued properties that have gone up," he said.
However, there is disappointing news for homeowners who won appeal reductions, which averaged 15 percent countywide. The appeal results are not part of the 2002 assessment formula.
"We have to rely on a consistent approach to market value in this formula, and not what any single appeal might have found," Mekkelsen said.
| New formula: An example |
The home: A 50-year-old ranch house in the North Hills, with about 1,000 square feet of living space, one bathroom, a fireplace and a basement garage.
Based on a formula that includes more than 51,000 property sales in the county from Jan. 1, 1998, to June 30, 2001, and includes 200 variables that describe a residence and 76 models to describe geography, location, price range and condition, this home's value is estimated at $97,413.
Part of the formula assumes that every square foot of living area for this kind of home in this area contributes $40.09 to overall value. Other features count, too. The garage adds $2,28, the fireplace $3,129. And since the home is more than 20 years old, that means any settling, which could cause damage, is already done, so the home's age actually adds $9,300 to its value.
It was here that the Sabre formula ended with a home's final value. The new model continues by searching the 51,000 home sales for five homes most like each individual property. The search starts in the neighborhood and expands outward until enough similar homes are found.
In the example of the North Hills ranch home, five comparable sales from the same neighborhood are located and then "adjusted" to more closely match the style, age, condition and other variables of the ranch home. The adjusted values — $84,996; $86,868; $88,384; $93,199; and $97,320 — are weighted, with homes closest in description to the ranch house given influence, and averaged. This provides a figure of $90,685.
At this point, there are now seven estimated values associated with the ranch house — the original estimate based on total sales, the five comparable sales and the weighted average. The two highest and two lowest values are then discarded. The remaining two values in the middle are then added to the original estimate of $97,143 and averaged.
The result: The ranch house is assessed at $90,700.
Source: Norm Mekkelsen, county Administrative Services director
| How to prepare for an appeal |
If anyone knows what kind of evidence works best at Allegheny County property assessment appeals hearings, it's Kevin McKeegan, who is chairman of the county's Board of Property Assessment Appeals and Review, which has overseen about 45,000 hearings so far.
McKeegan said the following is acceptable evidence at hearings:
People cannot use assessments from their neighbors' homes as evidence at hearings, McKeegan said. State law requires that property be assessed using a consistent method that produces a proper ratio between sale prices and assessed values.
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