Commercial property owners are bracing for the financial burden of reassessments on land and building values this year as Hall County officials weigh the option of a tax increase.
During a 45-day period between mid-April and early June, 2,789 appeals were made on reassessments, with 1,226 coming from commercial and industrial properties, or about 29 percent of all such properties in the county.
“It shows incredible heat that has been applied to the commercial property owner as a result of (Hall County’s) arbitrary reassessments,” said Frank Norton Jr., CEO and chairman of The Norton Agency, a Gainesville-based real estate firm.
Norton has appealed the reassessments on several properties he owns, with some doubling and tripling or more in value, and estimates that his current tax bill will increase by more than six figures this year if no changes are made.
Hall County properties are assessed at 40 percent of their value for tax purposes, and 1 mill equals $1,000 of assessed value.
Of more than 4,200 commercial and industrial properties inspected, about 60 percent saw a significant rise in value this year, with an average net increase of 27 percent, according to Hall County Chief Tax Appraiser Steve Watson.
The other 40 percent stayed within 5 percent of last year’s value or decreased.
“Initially, we had expected a larger volume of appeals for all classes of property,” Watson told The Times on Thursday. “From my conversations with my associates and peers throughout the state, we are seeing a downturn in appeals.”
There were more than 5,000 appeals made last year when lakefront properties were the primary focus of reassessments.
“I believe this, to some degree, indicates that property owners are more confident that our valuations are reflective of what they are observing in the market area and their neighborhoods,” Watson said.
Many commercial property owners, however, dispute these numbers.
“I have talked to my lawyers to determine whether to file a lawsuit against the Hall County tax assessor for those (reassessment) values,” Norton said, adding that he has been successful with this approach in the past. “I’m considering and weighing my options at this point.”
The tax assessor’s office will address every appeal and have appraisers confirm or adjust the valuations. Revised tax assessment notices will then be mailed. Property owners still not satisfied can then file an appeal with the state Board of Equalization.
The re-evaluation of commercial properties contributes to a potential 4.43 percent increase in the amount of property taxes levied this year if officials do not roll back the millage rate.
The property tax millage rate must be rolled back to 5.735 to remain budget neutral and account for increases in revenue from reassessments of commercial, industrial and residential properties.
But the Board of Commissioners has left open the option of keeping the tax rate in place at 5.989, which amounts to a tax increase under state law and would generate an estimated $1.6 million in additional revenue for the general fund.
Officials will conduct three public hearings later this month to work through the scenarios and finalize a budget for the 2016 fiscal year, which begins July 1.
With a full rollback, the projected revenue for the general fund is $92,179,874, while maintaining the current tax rate would produce an estimated $93,828,878