1. WELCOME 2016 Property Valuation Open Forum Presented by:
Paul D. Petersen, Assessor
WELCOME
2016
Property Valuation
Open Forum
Presented by:
Tim Boncoskey, Chief Deputy Assessor
Lesley Kratz, Senior Advisor Assessor
Marc Kuffner, Assistant Superintendent MCESA

2. Property Types
Paul D. Petersen, Assessor

3. 2015 Tax Roll Timeline
Paul D. Petersen, Assessor

4. Full Cash Analysis TY 14-15 (FY 15-16) Comparison
Paul D. Petersen, Assessor

5. Secondary NAV Change 14.70% PRELIMINARY
TY2015 (FY15-16) Secondary Abstract
Paul D. Petersen, Assessor
Secondary NAV Change 14.70%

6. Number Must Be Used for ALL Secondary/Primary Taxes
PRELIMINARY
TY2015 (FY15-16) Primary Abstract
Paul D. Petersen, Assessor
Number Must Be Used for ALL Secondary/Primary Taxes
Primary NAV Change 3.19%

7. Primary (LPV) Change
By Municipality
Paul D. Petersen, Assessor

8. TY2015 (FY15-16)
City Summary
Paul D. Petersen, Assessor

9. Primary (LPV) Change By Elementary School District
Paul D. Petersen, Assessor

10. By High School District
Primary (LPV) Change
By High School District
Paul D. Petersen, Assessor

11. By Elementary School District Metro
Primary (LPV) Change
By Elementary School District Metro
Paul D. Petersen, Assessor

12. TY 2015 (FY15-16)
School Summary
Paul D. Petersen, Assessor

13. 2016 Tax Roll Timeline
Paul D. Petersen, Assessor

14. TY 15-16 Comparison Full Cash Value Analysis
Paul D. Petersen, Assessor
Property Type
Median Values
FCV %
LPV %
FCV 2016
FCV 2015
Change
VACANT LAND
31,500
27,900
12.9%
4.30%
SINGLE FAMILY RESIDENTIAL
172,300
161,500
6.69%
4.93%
CONDOMINIUM
100,100
91,000
10.00%
5.00%
APARTMENTS
146,100
128,800
13.43%
COMMERCIAL
434,100
381,000
13.94%
3.24%
MANUFACTURED HOUSING
59,000
56,300
4.80%
3.75%
All exempt property, new construction, additions, alterations or
any change in use have been removed from this analysis

15. 2016 Median by Property Type
PRELIMINARY
2016 Median by Property Type
Paul D. Petersen, Assessor

16. TY 2016 Residential FCV Percent Change By City
Paul D. Petersen, Assessor

17. TY 2016 Residential FCV Percent Change By City
Paul D. Petersen, Assessor

18. Percent Change By ZIP Code
TY 2016 Residential FCV
Percent Change By ZIP Code
Paul D. Petersen, Assessor

19. Percent Change By ZIP Code
TY 2016 Residential FCV
Percent Change By ZIP Code
Paul D. Petersen, Assessor

20. Foreclosures
Paul D. Petersen, Assessor
52,866
2009
2010
2011
42,460
52,866
54,485
46,165
42,460
2008
25,892
42,460
2012
25,892
2007
10,998
11,379
2013
11,379
2014
6,302

21. TY 2016 Land FCV
Percent Change By City
Paul D. Petersen, Assessor

22. TY 2016 Land FCV
Percent Change By City
Paul D. Petersen, Assessor

23. TY 2016 Commercial FCV Percent Change By City
Paul D. Petersen, Assessor

24. TY 2016 Commercial FCV Percent Change By City
Paul D. Petersen, Assessor

25. Commercial
Paul D. Petersen, Assessor
9% of the 2009 Sales are REO

26. 2-12 Unit Apartments
Paul D. Petersen, Assessor
Apartments

27. 13+ Unit Apartments
Paul D. Petersen, Assessor

28. SINGLE YEAR TAX ROLL LEGISLATION
Paul D. Petersen, Assessor
PROPOSITION 117
&
SINGLE YEAR TAX ROLL LEGISLATION

29. Proposition 117 Constitution Article 18
Paul D. Petersen, Assessor
Constitution Article 18
(3) (b) For the purposes of taxes levied beginning in tax year 2015, the value of real property and improvements, including mobile homes, used for all ad valorem taxes shall be the lesser of the full cash value of the property or an amount five per cent greater than the value of property determined pursuant to this subsection for the prior year.
(4) The legislature shall by law provide a method of determining the value, subject to the provisions of subsection (3), of new property.
(5) The limitation on increases in the value of property prescribed in subsection (3) does not apply to equalization orders that the legislature specifically exempts by law from such limitation.
(6) Subsection (3) does not apply to:
(a) Property used in the business of patented or unpatented producing mines and the mills and the smelters operated in connection with the mines.
(b) Producing oil, gas and geothermal interests.
(c) Real property, improvements thereto and personal property used thereon used in the operation of telephone, telegraph, gas, water and electric utility companies.
(d) Aircraft that is regularly scheduled and operated by an airline company for the primary purpose of carrying persons or property for hire in interstate, intrastate or international transportation.
(e) Standing timber.
(f) Property used in the operation of pipelines.
(g) Personal property regardless of use except mobile homes.

30. Proposition 117 ARS § 42-11001 42-11001. Definitions
Paul D. Petersen, Assessor
ARS §
Definitions
In chapters 11 through 19 of this title, unless the context otherwise requires:
1. "Assessed valuation" means the value derived by applying the applicable percentage prescribed by chapter 15, article 1 of this title to the full cash value or limited property value of the property, as applicable…
6. "Full cash value" for property tax purposes means the value determined as prescribed by statute. If no statutory method is prescribed, full cash value is synonymous with market value which means the estimate of value that is derived annually by using standard appraisal methods and techniques. Full cash value is the basis for assessing, fixing, determining and levying primary and secondary property taxes on property described in section Full cash value shall not be greater than market value regardless of the method prescribed to determine value for property tax purposes.
7. "Limited property value" means the value determined pursuant to section Limited property value is the basis for:
(a) Computing levy limitations for counties, cities, towns and community college districts.
(b) Assessing, fixing, determining and levying primary and secondary property taxes on all property except property described in section
8. "Net assessed value" means the assessed value minus any exempt property.

31. Proposition 117
Paul D. Petersen, Assessor
ARS §
Assessed valuation of class one property
The assessed valuation of class one property percentage of its full cash value or limited valuation, as applicable:
Tax Year 2006 – 25%
Tax Year 2007 – 24.5%
3. Tax Year 2008 – 24%
4. Tax Year %
5. Tax Year %
6. Tax Year %
7. Tax Year %
8. Tax Year %
9. Tax Year %
10. Tax Year %
11. Tax Year 2016 – 18%

32. Proposition 117
Paul D. Petersen, Assessor
ARS §
Assessed valuation of class two property
The assessed valuation of class two property percentage of its full cash value or limited valuation, as applicable:
Tax Year 2015 – 16%
2. Tax Year 2016 – 15%

33. Proposition 117
Paul D. Petersen, Assessor
ARS §
Values furnished by county assessor
A. On or before February 10 of the tax year, the county assessor shall transmit and certify to the property tax oversight commission and to the governing body of the political subdivision or district in the county the values that are required to compute the levy limit prescribed by sections and For the purposes of this section, these values shall not be changed for the official calculation of levy limits and tax rates after February 10 without the approval of the property tax oversight commission. These values shall include:
1. The finally equalized valuation of all property, less Estimated Exemptions, appearing on the tax roll for the current tax year to be used to fix, levy and assess the political subdivision's taxes.
2. The Estimated value of the property on the personal property tax roll.
B. On or before February 10 of the tax year, the county assessor shall determine the limited property value for the current tax year of each school district in the county and shall transmit the values to the county school superintendent to assist the superintendent in computing equalization assistance for education as provided in section

34. TAX JURISDICTION BUDGETING
Proposition 117
Paul D. Petersen, Assessor
TAX JURISDICTION BUDGETING
Proposition 117 increases Limited Property Value 5% from previous year but cannot exceed Full Cash Value (cap).
Proposition 117 DOES NOT increase Net Assessed Value 5%.
Impacts on Net Assessed Value
Assessment Ratio Legislative Changes
Exemptions
Personal Property
New Property

35. Single Year High Appeals Caused Delays: Appeals Down By 55 per cent
Paul D. Petersen, Assessor
High Appeals Caused Delays:
Appeals Down By per cent
The Great Recession:
When Markets Plummet; Yet Values Lag Two (2) Years.

36. Single Year Roll More Accurate: Values – Closer to Notice
Paul D. Petersen, Assessor
More Accurate:
Values – Closer to Notice
Understandable:
Values prepared, noticed, and taxed within the same year
Responsive:
Values reflected in the market

37. Single Year Roll Valuation Year No More Valuation Year.
Paul D. Petersen, Assessor
No More Valuation Year.
Mail Business Personal Property (BPP) Reports January 1
February 2: Notice of Valuation
30 Days to Appeal
DOR Extension – 15 Days
Mobile Homes

38. Single Year Roll Supplemental Notice
Paul D. Petersen, Assessor
Due to the ability to pick up new property and tax them the next year, supplemental notices are no longer needed.

39. Single Year Roll Board of Equalization
Paul D. Petersen, Assessor
April 30: Assessor Ruling on Petition
Boards of Equalization:
June 20: County Board of Equalization
June 30: State Board of Equalization

40. Proposed Tax Roll Timeline
Single Year Roll
Proposed Tax Roll Timeline
Paul D. Petersen, Assessor

41. Paul D. Petersen, Assessor
TAX COURT
LITIGATION

42. Tax Court Litigation Summary
Paul D. Petersen, Assessor
Under the current statutory system, property owners who are dissatisfied with their property valuation or legal classification may appeal directly to Court.
The deadline to appeal to Court is December 15 or within 60 days after the date the State Board of Equalization mails its Decision, whichever is later.

43. Tax Court Litigation Summary Tax Court (TX):
Paul D. Petersen, Assessor
Tax Court (TX):
A record tax case requires lawyer representation. The filing is not only an appeal, it is a formal lawsuit filed against the County and/or State of Arizona.
All of the formalities of a lawsuit are followed beginning with the filing of a Complaint, Answer, and formal disclosure/discovery.
The average Tax Court case may stay in litigation for two or more years.
Tax Court – Small Claims (ST):
Attorney representation is not required to proceed in a Small Claims Tax appeal. Owners may represent themselves in small claims tax cases, or hire an agent approved by the Court to represent them.
Small Claims Tax matters begin the same as in a record Tax Court case, with the filing of a Complaint and an Answer. The Court will typically set the matter for trial within sixty to ninety days after the Answer is filed.
Because these involve small claims, the proceedings are more informal. The purpose is to give the property owner his day in court. The owner must still provide the Assessor with evidence to support their requested change.
The Assessor will make a settlement recommendation on ALL Small Claims Tax cases.
The average Small Claims Tax case lasts approximately six months.

44. Tax Court Litigation Total Cases Filed 2000-2014
Paul D. Petersen, Assessor

45. GOVERNMENT PROPERTY LEASE EXCISE TAX (GPLET)
Paul D. Petersen, Assessor
GOVERNMENT PROPERTY LEASE EXCISE TAX (GPLET)

46. GPLET’S
Paul D. Petersen, Assessor
ARS §
Commercial government property lease excise tax; database
A. A government lessor shall levy and the county treasurer shall collect an annual excise tax on each prime lessee for the use or occupancy of each government lessor's government property improvement…
D. The department of revenue shall maintain a public database by county, city and town of all government property leases that are subject to the tax under this article.

47. GPLET’S
Paul D. Petersen, Assessor
ARS §
Leases and development agreements; notice of tax liability; approval requirements; default
E. No later than June 30 of each year the government lessor shall provide the county assessor with a complete list of development agreements

48. GPLET’S Takeaways GPLET information received by municipalities
Paul D. Petersen, Assessor
Takeaways
GPLET information received by municipalities
Assessor MUST provide to MCESA for inclusion in Budget
Leases can be one of the following:
Abated for up to 8 years per ARS §
Exempt per ARS §
Excise Tax per ARS §
Assessor is the “Go Between”

49. Paul D. Petersen, Assessor
TAX RATES / LEVYS

50. Levy (Taxable) Amount / Assessed Value = Tax Rate
Tax Rates / Levys
Paul D. Petersen, Assessor
It’s Easy
Levy (Taxable) Amount / Assessed Value = Tax Rate

51. Tax Rates / Levys Yeah, Real Easy Equalization/State Aid/MQTR Budgets
Paul D. Petersen, Assessor
Yeah, Real Easy
Equalization/State Aid/MQTR
Budgets
Qualifying Tax Rate
Net Assessed Values
Bonds and Overrides
Cash
Encumbrances
Receivables
Delinquencies
Rollovers
Etc… and more

52. Tax Rates / Levys Funding Funding Sources:
Paul D. Petersen, Assessor
Funding
Funding Sources:
Local property tax collections.
State property tax, better known as the county equalization tax.
State’s general fund.
Basically: If a school district does not receive enough money from local property taxes to fund it’s schools, the state’s general fund, which has been supplemented by the state equalization property tax, makes up the difference in the funding needed.

53. Tax Rates / Levys Equalization Rate
Paul D. Petersen, Assessor
Equalization Rate
The legislature sets the Qualifying Tax Rate (QTR).
This is the tax rate the legislature uses to determine how much money a school district will get from the state, if any.
The QTR is multiplied by each district’s Net Assessed Property Value (NAV). The answer to that equation determines the source(s) of a school district’s funds.
(Lessor Of) RCL/DSL + DAA = Equalization Base.

54. Equalization / State Aid
Tax Rates / Levys
Paul D. Petersen, Assessor
Equalization / State Aid
If the equalization base funding level is greater than QTR x NAV, local property taxes will not be adequate to fund the district’s budget. The remaining amount of funding is provided by the state’s general fund. This is called basic state aid.
If the equalization base is less that QTR x NAV, no basic state aid is provided and the primary property tax rate is set at the level required to generate the equalization base.

55. Net Assessed Value (NAV)
Tax Rates / Levys
Paul D. Petersen, Assessor
Net Assessed Value (NAV)
February 10th – The Magic Date!
Assessor must provide to County School Superintendents the values to be used for the upcoming tax year on this date.
Primary NAV – Used to calculate both the primary and secondary school district tax rate.
Prop 117
There is still a secondary NAV, not used anymore for tax setting.

56. THANK YOU! 2016 Appeal Deadline April 21, 2015
MARICOPA COUNTY ASSESSOR’S OFFICE
Tim Boncoskey | |
Lesley Kratz |
MARICOPA COUNTY EDUCATION SERVICE AGENCY
Marc Kuffner |
Paul D. Petersen, Assessor