2013-10-18 / Front Page

Tax decision delayed

By Michael Kelley Staff Writer

The Board of Assessment Review’s decision on 43 tax assessment appeals has been delayed once again. It is the third time since August the five-member board has postponed the verdict.

After five hours of testimony and crossexamination Tuesday, Oct. 15, the board decided to reserve final judgment and continue the hearing to 6:30 p.m. Tuesday, Nov. 26.

The appellants — homeowners in the Higgins Beach, Pine Point and Prouts Neck areas — claim they were unfairly assessed during former assessor Paul Lesperance’s town-wide revaluation in 2012 and take exception to the process he used.

Lesperance, who retired earlier this year after 29 years as Scarborough assessor, has previously said his goal in the revaluation was to create an equitable tax assessment for all residents of town and not to target those on or by the water.

On Sept. 23, Lespereance said while it is true many of the 279 assessments he increased were by the water, the revaluation was done town-wide and included 475 cases in which assessments were decreased. He said his readjustments were based on sales data in the neighborhood where the property is located and not based on sales in other parts of Scarborough.

George Koutalakis, a real estate appraiser with Sterling Appraisal Company and a longtime Realtor, was asked by John Shumadine, an attorney with Murray, Plumb and Murray in Portland, to review sales data from 2010 to 2012 provided by the tax assessor’s office. Shumadine has been hired by the appellants to present their case to the Board of Assessment Review.

Koutalakis said his goal in looking at the sales data was to see if there were any consistent trends.

“What I found was no consistency. The assessments were all over the place,” he said.

He said he also found data that would suggest that the recession in 2008 did affect Scarborough, something that Lesperance said never happened.

By looking at “paired sales,” or properties that sold twice between 2005 and 2012, Koutalakis found 22 instances where properties sold for less post recession than they did prior to it. One property he pointed out was 9 Avenue 3 in Pine Point that sold in 2006 for $399,000 and again in 2012 for $317,500, or $81,500 less.

“All of these properties sold for less after the recession than they did prior to it,” he said. “You don’t have that happen if a recession didn’t hit a community.”

As part of his testimony, Shumadine said the waterfront homeowners were indeed discriminated against because they saw some of the most unfair tax assessments.

The goal of an assessment is to get within 90 to 110 percent of the fair market value, but Shumadine said 40 percent of homes in town and 60 percent of homes on the waterfront don’t meet that threshold.

This, he said, shows there is less chance homes along the water were taxed based on their “fair and equitable value.”

“If you are outside the waterfront, you have a much greater chance of (the assessment) being close to the fair market value,” he said.

Shumadine also saw inconsistencies over which properties were reassessed and which ones were not. He noted several examples of properties in Higgins Beach and Pine Point, which saw 20 to 25 percent assessment increases while properties nearby — with similar water views — did not. Furthermore, Shumadine pointed out, many of the waterfront properties saw increases while interior parcels did not.

This, Shumadine said, makes “no rational sense.”

“There is no rhyme or reason to what the assessor did,” he added.

Lesperance said based on the sales data he had, he saw no reason to increase interior lots at Higgins Beach. Although most of the properties that were adjusted were increased by 20 percent, assessments varied, Lesperance said, based on the individual circumstance on each lot. He said values were not assessed by view and never have been.

Between now and the first week of November, Lesperance’s attourney, Rob Crawford of Bernstein and Shur, and Shumadine will be tasked with submitting written briefs to the board summarizing their case. Chairman Alan Peoples gave them a deadline of the close of business Nov. 8 to get the summations in.

If a decision is rendered Tuesday, Nov. 26, it would bring to an end the months-long appeal. The appeal hearing started Aug. 19, but had to be continued due to technical difficulties with Scarborough Community Television audio equipment. The hearing was continued Sept. 23, but the board opted to continue it yet again after hearing more than five hours of testimony from Lesperance, and cross examination from Shumadine, who did not have an opportunity to present his case at that time.

Aside from the appeals from Shumadine’s clients, the Board of Assessment Review is expected to hear tax assessment appeals from additional homeowners Tuesday, Nov. 5 and Tuesday, Nov. 12.

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