AnonymousBy Dennis Adderton
I am writing an open letter to Joseph Holland, Santa Barbara County Assessor, to raise his attention to dubious calculations used in the assessment of property values. I have discovered some strange distortions of generally accepted mathematical principles to arrive at erroneously inflated assessments. I am forced to publish this letter publicly because I have found Holland completely inaccessible to the public.
In particular, when a property with a structure under construction is assessed for present value, construction costs are continually revised upwards, backwards through time. That is, if the assessor-determined construction cost goes up during the course of construction, then the cost is revised upward for the years predating the increase. This is erroneous math. The correct calculation would be to use a summation over the years of construction, using the correct cost for each year.
This may seem like a subtle difference, but this math is simply not correct. It would be marked off as a wrong answer on a high school pre-calculus test. Having discovered this grave error, I brought it to the attention of the staff at the Assessor’s Office. I was met with very surprising defiance in the face of facts. Having raised the issue to the highest level available to the public, the Chief Deputy Assessor, it was explained to me that the error was in fact intentional. They had somehow hybridized the concepts of cost and market value to arrive at a number that was neither cost nor market value, however, exceeded both.
This kind of intentionally erroneous math, when perpetrated by the public, is prosecuted as tax fraud. And yet, how is this justified by the tax assessor? There was no concise explanation forthcoming. I was given some printouts of legal jargon making vague statements about base values. No math was described in the text. Then I watched a manager jump back and forth between the terminology of cost and market value, unable to stand on either point. He was simply blurting gibberish to confuse and obfuscate the issue. Ultimately, I was told that I needed to pay for gold-plated toilets in Montecito.
The Assessor’s Office is there to serve the public. There must be accountability and integrity for the public to rely on. Using wrong math to inflate values is beyond unacceptable. Joe Holland, if you are doing your job as Santa Barbara County Assessor, please check the math.
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I watched an interview with him. He has no idea what he’s talking about
11:55am – The assessed value is the purchase price, which yes includes the commission. So Chip is correct, you are paying property tax not based on what the seller got for selling you the property…but what you paid for the property as well as the usual 4% to 6% buyers/sellers agents commission.
Elrawd is even more incompetent than Lozano and that epitome of whiny uselessness, Caldwell.
As with CW, never vote for anyone endorsed by the above person.
That was not a jab. Those were the words of the assessor. Hypothetical golden toilets in Montecito need to be averaged into construction estimates for everybody. That was some of the absurd gibberish I was subjected to that did not even address the problem of using wrong math.
Or don’t. The kid is completely unqualified and is funded by the fringe GOP. He also illegally has his political banner on the highway overpass around La Cumbre. Big fat no.
Illegal political signs from one political party litter our roads. They come out in the dead of night and add to the litter. There are rules, and campaigns are expected to follow them. When you see these illegally posted signs on public property, remember to NOT vote for the sufflaws. If they can’t even follow those rules, can you imagine the mess they will create if in a public office. Only legal signs are on people’s lawns.
“fringe”….okay…. .SMH…
“Vote for Elrawd Maclearn! ” …. Why – is that who Q is endorsing?
There is another issue with property tax assessments that I think should be addressed. When someone buys a property on the open market, it’s tax assessment is generally updated to reflect the purchase price. However, in a typical transaction 6% of the purchase price is commissions for the real estate agents. The assessor does not consider this and includes the agent’s commissions in the assessed value. Buyers with sufficient funds can pay the agent’s commissions directly, thus lowering their purchase price and resulting tax assessment by 6%. For a $1m property, paying the commissions directly would result in a savings of approximately $750 per year. Unfortunately, most buyers lack the funds to do this and are stuck paying property tax on the agent commissions for the duration of their property ownership.
When I questioned my property taxes a few years ago, I was asked “how do you know it is too high?” Well I am a real estate appraiser, I value properties for a living. The person on the phone was very quiet!
The fee you pay an agent has no bearing on the value of the real estate.
I don’t know much about Elrawd, but he seems suspect to me.
1043 – That’s what Chip is (seemingly) saying…
I don’t think the fees paid to the agents should be included in the tax assessment, but they almost always are. Most buyers include the agent fees in the price they pay for the home, making it possible to finance the agent fees in the mortgage as part of the purchase price. This also results in the agent fees being added to the tax assessment. Savvy buyers who have sufficient funds can pay the agents separately and save 6% on their property tax bill forever. However, the fees would be $60,000 on a $1m home purchase and very few buyers are in a position to pay that out of pocket on top of their down payment.