Assessment in Salt Lake County

Article XIII of Utah Constitution “All Tangible Property… assessed at a uniform and equal rate in proportion to its fair market value ” assessed at a uniform and equal rate in proportion to its fair market value ”

Types of Tangible Property Real Property Real Property Land and buildings Land and buildings Personal Property Personal Property Business equipment Business equipment Motor Vehicle Motor Vehicle Centrally Assessed (State Tax Commission) Centrally Assessed (State Tax Commission) Mines, Utilities, Airlines, etc. Mines, Utilities, Airlines, etc.

What is Market Value? (12) (12) “Fair market value” means the amount at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts. “Fair market value” means the amount at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts.

Market Value is the common denominator shared by all types of property.

What the Law Requires “The County Assessor shall assess all property located within the county…” “Prior to May 22 of each year, the county assessor shall ascertain the names…” “…each county assessor shall annually update property values,…based on a systematic review of current market data. In addition, the Assessor shall complete a detailed review of property characteristics for each property at least once every five years.”

Duties of the Assessor 1. Collect Property Characteristics 2. Systematic Review of Market Data 3. Valuation 4. Other Duties

1. Property Characteristics Location Location Land characteristics Land characteristics Building style Building style Residential: 1 story, 2 story, split-level, etc. Residential: 1 story, 2 story, split-level, etc. Commercial: office, retail, industrial, etc. Commercial: office, retail, industrial, etc. Building features Building features Measure and determine size of building Measure and determine size of building Quality of construction Quality of construction Condition of structure Condition of structure

2. Systematic Review of Market Data Collect sales information Collect sales information State or County Questionnaires Multiple Listing Service (where available) Property owners/managers Property owners/managers Commercial Lease and Rent information Commercial Lease and Rent information Verify the validity of the information Verify the validity of the information

Taxpayer Statement - Self Reporting

3. Valuation Sales Comparison Sales Comparison Based on actual sales of “comparable properties” Based on actual sales of “comparable properties” Cost Approach Cost Approach Based on current material and labor cost necessary to replace the subject property with similar function and utility Based on current material and labor cost necessary to replace the subject property with similar function and utility Income Approach Income Approach Based on current rental or lease income and associated expenses of the subject property and/or like properties Based on current rental or lease income and associated expenses of the subject property and/or like properties Three approaches to market value:

Study of Three Comparable Houses Sold for $389,000 Sold for $361,000 Has not sold What is the fair market value of each home? Suggested Value for all three: $375,000

Neighborhood sample showing average sale value to non-sold average assessment value 2008 Salt Lake County Assessment Roll

1 st Half Average Sale Price WRFMLS Statistical Data

2 nd Half Average Sale Prices WRFMLS Statistical Data

Average Sale Prices WFRMLS Statistical Data

AreaModel Parcels2007 to 2008 Pct Chg2006 to 2007 Pct Chg Southwest84 51, %28.60% City89 29, %17.90% Aves/East Bench87 13, %18.95% West Valley85 59, %22.40% Lower Sandy82 24, %20.50% Condos3 23, %25.36% Holladay81 6, %22.10% Upper Sandy83 18, %24.40% East Millcreek80 21, %17.0% Foothill88 10, %23.43%

Approved Methods Used Use same professional methods approved and accepted by private appraisal industry, and in accordance with generally accepted methodologies and techniques as prescribed by Uniform Standards of Professional Appraisal Practices (USPAP)

Appraisal Summary Commercial/Residential Commercial/Residential Sales/Leases Sales/Leases Identified Identified Verified Verified 5 Year Systematic Review 5 Year Systematic Review New Construction New Construction Partial Construction Partial Construction Valuation (Model) Development/Review Valuation (Model) Development/Review Land Neighborhood Definition Land Guidelines Segregrations Quality Control Internal Sales Ratio Studies Queries Pictometry Available in Washington, Weber, Davis, Utah, & SLCnty IT Data Conclusion Reports GIS Utilization

4. Other - Administrative Responsibilities 4. Other - Administrative Responsibilities Personal Property Personal Property Motor Vehicle Motor Vehicle Non-appraisal functions Non-appraisal functions Exemptions/Abatements Exemptions/Abatements Residential Residential Board Exempt Board Exempt Constitutional Constitutional Greenbelt/Rollbacks Greenbelt/Rollbacks GRAMA/Commercial Confidentiality GRAMA/Commercial Confidentiality Annexations/Tax District Identification Annexations/Tax District Identification

Quality Assurance Program Appeals (BoE, STC, District Court, Supreme Court) Appeals (BoE, STC, District Court, Supreme Court) Internal Actions Internal Actions Appraisal and project reviews Appraisal and project reviews Sales Ratio Studies Sales Ratio Studies State Tax Commission State Tax Commission Compliance audits Compliance audits Sales ratio studies Sales ratio studies Corrective Action Orders Corrective Action Orders Other Other

Salt Lake County Assessor Organization Chart

Salt Lake County Functional Chart

Key Property Tax Dates January 1Lien Date May 1New Greenbelt applications must be filed May 22 Assessor completes assessment roll and delivers to auditor August 1 to To Sept 15Forty-five day appeal period Prior to Nov 1Auditor delivers assessment roll to the Treasurer Treasurer mails Tax Notices After Nov 30Unpaid taxes become delinquent

TRUTH IN TAXATION Truth-in-taxation prohibits units of local government from obtaining windfall revenues as a result of revaluation or equalization projects. ( ) & ( , 918, 924)

TRUTH IN TAXATION Utah State property tax law requires that when property values rise property tax rates must fall. The adjusted rate each year is called the “certified tax rate.”

Certified Tax Rate is that rate which will yield the taxing entity the same property tax revenue that it budgeted in the previous year, excluding new growth.

TRUTH IN TAXATION Reasons why a property owner’s taxes might go up despite truth in taxation: Centrally Assessed Shift Centrally Assessed Shift Variation in Market Values Within a Taxing Entity Variation in Market Values Within a Taxing Entity Above the average increase in value within Entity – Above the average increase in value within Entity – Taxes Increase Below the average increase in value within Entity – Below the average increase in value within Entity – Taxes Decrease Taxpayer Voted Leeway Taxpayer Voted Leeway Taxpayer Voted Bond Taxpayer Voted Bond Property Tax Increase Following Truth In Taxation Hearing Property Tax Increase Following Truth In Taxation Hearing

Reasons why a property owner’s property taxes might go up despite Reasons why a property owner’s property taxes might go up despite truth in taxation truth in taxation  Centrally Assessed Shift Data from the Utah State Tax Commission’s Annual Property Tax Statistical Report

The Market Shift - The Cycle of Real Estate Values Changing

Salt Lake County - Historical Statistical Division - Salt Lake County Assessor

Salt Lake County 2007 Parcel Value Percent Change Color% Change# Parcels Grey=< 01,258 Green1 - 51,792 Blue ,921 Orange ,694 Red=> 21150,304

Salt Lake County 2008 Parcel Value Percent Change Color% Change# Parcels Grey=< 094,762 Green ,775 Blue ,038 Orange ,791 Red=> 216,389

Truth & Taxation Notice for the 2007 Tax Year in Salt Lake County

Taxpayer’s burden must be based on “equality” and a “fair-share” concept The Utah Constitution --- The Utah Constitution --- “All tangible property in the state, not exempt under the laws of the United states, or under this constitution, shall be taxed at a uniform and equal rate in proportion to its value, to be ascertained as provided by law...” “All tangible property in the state, not exempt under the laws of the United states, or under this constitution, shall be taxed at a uniform and equal rate in proportion to its value, to be ascertained as provided by law...”

 The Utah Constitution --  The Legislature shall provide by law a uniform and equal rate of assessment on all tangible property in the state, according to its value in money.  1.0 Cyclical Appraisal. For each piece of real property in the county, each assessor is required by statute to: Annually update the property value based on a systematic review of current market data Annually update the property value based on a systematic review of current market data Complete a detailed review of property characteristics at least once every five years Complete a detailed review of property characteristics at least once every five years

ASSESSMENT IN Salt Lake County O Office Mission E Equity for ALL A Accurate Values F Follow State Constitution A Adhere to State Statutes

Property Assessment is the mechanism used in Utah to determine your share of property taxes - money used to fund government: Schools Schools Roads Roads Police Protection Police Protection Fire Protection Fire Protection Snow Removal Snow Removal Recreational Centers Recreational Centers Sanitation Sanitation Flood Control Flood Control Water Water Planning & Zoning Planning & Zoning Criminal Prosecution Voting Surveys Recordings Mosquito Abatement Libraries Animal Control Parks & Zoo Facilities Government Buildings Etc.