House values may be in freefall, with no one buying anything, but Schenectady’s property values have gone up $1 billion, Assessor Patrick Mastro said.
Mastro’s reassessment was made public Tuesday in individual letters to every property owner. Most assessments went up, which means the tax rate will drop significantly unless the City Council chooses to greatly increase taxes next year.
The tentative tax rate for 2010 — which assumes that the $1 billion in new assessments is not overturned on Grievance Day and that the City Council does not vote to raise additional taxes — would be $12 per $1,000 assessed. That’s a 42 percent decrease from the current rate of $20.85 per $1,000.
With the new tax rate, just more than half of the city’s homeowners would see a slight decrease in their taxes. About 45 percent will see an increase, generally of less than $500, Mastro said.
A majority of the commercial property owners would also see a decrease. About 57 percent will get a tax cut, Mastro said.
But one business would see a big tax bill. General Electric’s assessment will more than double, from $36 million to $77.8 million. That would lead to a tax increase of $183,000.
GE officials said they were shocked by the change.
“We’re mystified by this. Where is it coming from? What caused it to be raised at such an amazing rate?” asked spokeswoman Jan Smith, who said the company would have been content with a market value of $56 million. The company has paid taxes on $36 million under the city’s 64 percent equalization rate, a rate set by the state to indicate how inaccurate the city’s assessments are in comparison to current sales data.
Last year GE did make some improvements to its Schenectady site, beginning a $39 million renovation of an old warehouse, which will become the Renewable Energies headquarters. Workers started last December, but the renovation is not yet done. Mastro said the assessment increase was partially based on the early work for that building.
“They got a partial [assessment]. Next year when that’s completed, there will be another increase in their assessment,” he said, adding, “It’s not a negotiating number.”
Smith said GE would immediately discuss the assessment with the city. She declined to say whether GE would pursue the matter in court if its assessment is not reduced.
“I hope it’s a matter of reasonable conversation,” she said. “We’ve had a very good working relationship with the city these past few years.”
Mastro said he’s confident that GE’s assessment is correct.
“I’m confident enough to go to court with every one of these values,” he said. “I reviewed every single commercial property myself, twice.”
Property data collection workers also swept the city four times in an attempt to make sure that all of the data were correct. His staff then reviewed every residential property assessment after the tentative roll was calculated.
“I think some reval projects run the statistics, look at what they call outliers and then review a percentage of the high side, a percentage of the low side,” Mastro said. “We reviewed every single property.”
The entire reassessment was done in-house, costing the city about $450,000 versus about $1.4 million for a private company. Much of that savings came from Mastro; for the past 14 weeks, he has worked every Saturday to finish the tentative roll on time.
Now he will run informal sessions at which residents can attempt to change their assessments. Mastro said that with 20,500 properties under reassessment, there could be a few errors.
“It’s not a perfect process,” he said.
Hearings will run from March 9 to April 10, by appointment only, at the casino in Central Park. Each meeting will be limited to 10 minutes, and property owners must bring some proof to support their argument. Those without any proof will be turned away, Mastro said. To make appointments, call 382-5075.
Owners can also formally grieve their assessments on Grievance Day, May 26. At that time, the Board of Assessment Review will vote on whether the assessment should be changed.
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