Assessment Appeals Could Be Followed By Law Suit

 

By Staff

 

Friday at Emmanuel Baptist Church, the Ministers Conference of Winston-Salem and Vicinity(MCWS) held a press conference to announce their immediate drive to facilitate Forsyth County home-owners in filing appeals on their recent property-tax value assessments. Also at the table were members of the Konnoak Hills Community Association and the South W-S Community Coalition along with citizens who have been effected by the lowered values.

press conference

Flanked by State Senator Earline Parmon(D-S34), Winston-Salem Mayor Allen Joines, State Representative Evelyn Terry(D-NC71), Forsyth County Commissioner Everette Witherspoon(D), and City Councilman Derwin Montgomery(D) the MCWS gave full-throated endorsement to the proposed legislation by Rep. Ed Hanes Jr.(D-NC72) that would return assessments to 2008 values and have the process used to make assessments investigated for flaws or bias. Finally the MCWS announced their plans to address this issue with demonstrations and community rallying. In clear terms the MCWS also indicated that a class action law-suit is in the works which would directly address the process by which the assessments are made, the metrics used for measurement, and the legitimacy of so-called “qualified” property sales.

Following an introduction by Rev. Willard Bass Jr., Bishop Todd L. Fulton read the following statement:

Forsyth County Citizens asked the Minister’s Conference of Winston Salem and Vicinity Social Justice Committee to address the devastating property tax assessments that were issued to Forsyth County homeowners. Property owners have lost from 40 to over 65% of their tax value in 2013 versus the 2012 tax listing.

bishop fulton

As a result the Minister’s Conference of Winston Salem and Vicinity, Neighborhood Organizations, Churches, Homeowners and Concerned Citizens have come together to get this assessment and the current assessment process overturned. This is Phase 1 of an effort to have the County Property Assessment changed. We support the bill by Representative Ed Hanes to halt the Forsyth County Property Assessment process in Raleigh. We are asking affected homeowners to bring the 2013 Reappraisal Informal Appeal Form (the form was received in the mail with your new appraised value) to one of the three recreation centers. Volunteers will be available to assist you in the completion of your appeal form and/or to receive your completed appeals. We will present appeals in mass to the Forsyth County Tax Assessor to show our unified rejection of the 2013 Appraisal and the appraisal process.

The rec centers where MCWS volunteers will be are:

Georgia Taylor Community Center – 1471 W Clemmonsville Rd, (336) 650-7695
Carl H. Russell Sr. Recreation Center – 3521 Carver School Road (336) 727–2580
Sprague Street Community Center – 1350 E Sprague St (336) 650-7680

Volunteers will be on hand to assist those who wish to file formal appeals from 12:00 noon – 2:00 pm and from 6:00 pm – 8:00 pm.

yolanda hairston

Yolanda Hairston, Volunteer Coordinator for the MCWS, spoke not only as an advocate, but as a home owner who has seen the value of her 3,000 foot, custom built brick home in East Winston-Salem lose 60% of its tax-assessed value since 2008. Hairston stated, “A comparison of homes in the county reveal that houses on Maplewood with many sales in the neighborhood lost $2 to $3,000.00 in value 2012 vs. 2013. Homes on Old Salisbury road lost between $20,000.00 and $25,000.00. Avera Ave. houses lost $20,000.00-$30,000.00. Tony Dr. in the Carver School Road had no qualified sales and lost 60 to 75% in tax value. Communities where homes are not continually ‘flipped’, but lived or are an investment had a much greater loss of value than other neighborhoods.”

In her comments the President of the Konnoak Hills Community Association, Carolyn A. Highsmith, directly addressed the process by which the assessments were made:

“We have learned that more than one type of ‘unqualified home sale’ is being counted as a ‘qualified sale’ in this year’s Reappraisal Process. One example of an ‘unqualified sale’ is a foreclosure, and it is illegal for foreclosures to be considered in the tax reappraisal formula for determining ‘Fair Market Value.’ Many are wondering if foreclosures were counted as ‘qualified sales’ in this year’s reappraisal process for very stable neighborhoods without significant home sales. Also, to keep from losing their properties to foreclosure, many Forsyth County homeowners (who were close to defaulting on their mortgages) were forced under duress to sell their properties at severely depressed sales prices to real estate investors looking for short term gains. These homes were listed under ‘Multiple Listing’ as regular ‘Homes for Sale.’

In turn, real estate investors bought such properties at rock-bottom prices and then flipped them to make a quick profit. I know for a fact that such duress Sales have been counted as qualified sales in my Konnoak Hills Community under this flawed 2013 Tax Reappraisal formula.”

Tax value does not define real estate value for a home, but it does have an impact on the perceived value of a home for real estate purposes. Tax value is currently based on real estate values because qualified sales were the main reference point used to assign a property’s tax value. Although semantically and technically separate things, tax value and real estate value are connected by the fact that each is used in some part to determine the other.

Additional reference points should be introduced to the valuation process to account for variations such as a small sample of comparable sales or information that might nullify a sale as a qualified sale. A requirement could be placed on the number of qualified sales that must be included in a sample to create a determined ratio in order to change the valuation of properties in a neighborhood or defined area. The definition of a qualified sale could exclude homes sold under duress, homes turned over to the bank (or “walked away from”), homes sold as short sales, homes sold in lots to investors, and homes sold to companies, as well as homes sold in foreclosure.

City Councilman Derwin Montgomery commented about the fact that tax-assessment values effect not only individual home-owners, but also effect community development- particularly as it relates to locating the kind of restaurant and retail chains which tend to help elevate home values with their presence. “When you have individuals coming into the community that (ed. assessments) is how they determine whether to invest in a community or not. When these chain businesses come in and they see homes once valued at $200,000.00 now valued at $70,000.00 it will give the wrong impression.”

jerry hanes

East Winston-Salem resident Jerry Hanes lives just off of MLK and has seen the value of his home drop over 60% in the current assessment. Mr. Hanes is even more blunt about the real fears of many East Winston residents. That fear is that real-estate speculators will take advantage of the low assessments and exploit East Winston in a future rush of gentrification that would create a situation where citizens could not afford to live in the neighborhoods they grew up in. “In my opinion this is about devaluing my neighborhood. How are we tryin’ to tell our young people to buy houses in East Winston when our community has been ‘Devalued’.”

Rep. Eveyln Terry pointed out that the process of devaluing the communities in East Winston-Salem began 40 years ago when things like “redlining” by banks when considering loans were common practice. “Redlining” was where banks and other institutions drew red lines on city maps to mark out areas where the would loan no money or only make high interest loans in particular neighborhoods. These lines tended to be drawn around urban neighborhoods predominantly populated by African Americans. “There is quite a difference between income and wealth.” Rep. Terry said.

Mayor Allen Joines addressed the threat to the real “wealth” in our communities in his comments. “For so many of our residents their home value is the number one component of their net worth.”

Some citizens have seen a drop in their property tax bill as a boon that has saved some hundreds of dollars in the short term. County Commissioner Everette Witherspoon poured water on the idea that a cut in the current tax bill is a benefit. “There are plans to raise the tax rate. That revenue has to be raised no matter what… even though your houses will be valued less, you will end up paying around the same thing in taxes. With the tax rates raised a lot of your ‘savings’ would be a wash.”

All of those gathered voiced support for the legislation that has been proposed by Forsyth County General Assembly freshman, Ed Hanes Jr..  State Senator Earline Parmon suggested that citizens should contact their local state legislative delegation and ask them to support the bill. “I can’t understand how any of our representatives couldn’t be behind this.” Sen. Parmon indicated that she would also be putting legislation into the Senate once Rep. Hanes had been able to file his at the beginning of next week.

Wayne S. Patterson, President of the Winston-Salem/Forsyth County NAACP told CCD that he and the organization are completely behind Rep. Hanes’ legislation and the efforts of the MCWS. “We (NAACP) openly disagree with these tax-assessments. It is appalling to home-owners, including myself, that these kinds of assessments were made. The Winston-Salem/Forsyth County NAACP is hand in hand with the Ministers Conference and these other organizations. We will be adding over 350 more citizens who will be willing to stand up for what is right.”

mayor joines

Mayor Joines also came out for the Hanes legislation, officially announcing Friday that he will request that the City Council approve a resolution in support of the legislation that will be introduced by Rep. Hanes. “The last four years have been an extraordinarily difficult time for our economy, particularly for home values. By moving the current appraisal cycle to the state minimum of eight years, we give the market a chance to correct itself and not further punish those who have been hardest hit financially during the recession.”

County Commissioner David Plyler told CCD that he does not support Rep. Hanes’ legislation. Republicans Gloria Wisenhunt and Richard Linville told the Winston-Salem Journal that they are opposed to the legislation and think that the assessments are proper and fair. Democratic Commissioners Witherspoon and Marshall have been clear that they support the proposal.

CCD caught up with County Commissioner Mark Baker(R) who lives in the more rural, northern part of Forsyth County which has also been hit hard by devaluations. “I am supportive of the bill.” Baker said. “I think this is an anomaly in the housing values. It has hurt many of our residents. It has put them under on their mortgage and many have lost their equity in their house. It seems that large number of foreclosed houses that were bought and then quickly flipped for a modest profit has drastically affected values in certain neighborhoods. I think the best thing would be to put them off for a year or four and let the tax value fall back in line with true home values.”

For his part Rep. Hanes spent much of the day in Raleigh working on the bill. He updated CCD on the filing. “We have the bill done in draft form. We sent it off to the UNC Chapel Hill School of government to make sure that we are within the parameters of the State’s Constitutional mandate for uniformity. We hope to have a bill filed early next week.” Hanes said. He re-iterated that the intention of this bill is to be a help to County Commissioners and other local officials deal with this crisis. “The idea here is just to add another tool to their tool box.”

audience

Before the press conference ended Bishop Fulton said that one of the next steps for the MCWS (depending on the fate of Rep. Hanes’ bill) may be a class action law-suit brought by Forsyth County residents. “We have contacted attorneys and help is available to you, but you are going to have to become involved as citizens.”

rev. jimmie bonham

Rev. Jimmie Bonham, who is on the Social Justice Committee and is helping coordinate a suit on behalf of home-owners stated, “We will continue to inform the citizens as it relates to the process of appealing the process. We are looking forward to, if needs be, a class action law suit to reform the process.” Rev. Bonham confirmed that the MCWS has been in contact with attorneys, including the ACLU about the possibility of a suit. Bonham did not, however, relish the idea of a protracted legal battle. “That is why it is important to support Representative Hanes’ bill. We as a community want to resolve this amicably.”

Bishop Fulton made sure that the short-term focus remained on getting home-owners out to the rec centers on Monday, March 11th in order to file official appeals before the Tuesday deadline and making sure that citizens see the crisis that is real and immediate. “Our neighborhoods are on fire.” Bishop Fulton said, “We have to put out these flames by digging ditches and building trenches around our neighborhoods.”

 

MCWS Press Release Full Text

 

You can see CCD‘s previous coverage of this issue HERE and HERE.