County’s Backlog of Property Tax Appeals Growing

It’s been seven months since Ana Rasmussen told the county that her property taxes were too high.

Like homeowners throughout Southern California, Rasmussen has spent the last few years watching the value of her home on Port Hueneme’s Seashore Court decline in the region’s weak real estate market. Purchased in January 1993 for $220,000, the single-story Cape Cod-style home would now fetch just $211,000, according to an assessment done when refinancing the loan in August.

But her latest tax bill doesn’t reflect that. Despite an appeal to county assessors last September, the county estimates the value of Rasmussen’s home at $227,000, up from $224,000 last year.

“I’m getting more frustrated by the minute,” she said. “My property taxes keep going up, and my property value keeps going down.”

Rasmussen is just one of many Ventura County residents in a similar bind. As Wednesday’s deadline for semi-annual property tax payments looms, the county assessor’s office is wading though a backlog of about 7,000 appeals waiting for resolution, said Chief Deputy Assessor Bruce Gray.

Nor is the problem confined to Ventura County. Orange County has about 29,500 appeals on file; Los Angeles County has about 80,000, according to the State Board of Equalization.

The glut of appeals is the result of the region’s six-year slide in property values. In Ventura County, the median selling price of homes fell 17.9% between its prerecession peak in August 1989 and December 1995, according to the UC Santa Barbara Economic Forecast Project.

As home prices shrink, there are a growing number of discrepancies between market values and the assessments that counties use to determine property taxes. Those discrepancies lead to more appeals, overloading county officials and bogging down the appeals process.

“There is an enormous backlog of cases, and we may not even be able to see a case--after it’s filed--for half a year,” Gray said.

To make matters worse, many property owners are surprised to see their official assessments rise from year to year, believing that Proposition 13 protected them from increases.

Ken Hubbard of Ventura says the assessment on an old, three-bedroom house he owns on Santa Paula’s North 7th Street rose from $197,074 last year to $199,417 this year.

“They keep reevaluating my property and raising the taxes,” he said. “I just don’t think it’s fair.”

But Proposition 13, which states that properties will be officially reassessed only when they are sold, also allows assessments to increase a maximum of 2% each year. The increases are tied to the state’s consumer price index.

Last year’s increase was 1.19%, marking only the second time since Proposition 13 was passed in 1978 that assessments rose less than 2%.

Using real estate sales figures and computer models, county assessors try to figure out which properties might be losing value. Charles Knudsen, principal appraiser with the State Board of Equalization, said that in cases where appraisers think a home’s value has declined, they base property taxes on the lower figure.

Gray said Ventura County has lowered the assessments on more than 60,000 properties during the real estate bust. But the assessor’s office, which lost 21 appraisers to budget cutbacks several years ago, has lacked the staffing to make all the adjustments needed.

“Because of downsizing, we’ve often come up short,” Gray said.

Staffing is crucial because if the county cannot resolve an appeal within two years, the appeal is automatically resolved in favor of the homeowner. It has never come to that in Ventura County, Gray said.

During the last year, the department has added six appraisers to help ease the workload, Gray said.

In the meantime, property values continue to fall, although the rate of decline has slowed. Nima Nattagh, an analyst with TRW-REDI Property Data, said Ventura County home prices dropped about 3.2% between January 1995 and January 1996, the most recent figures available.

Mark Schniepp, a UC Santa Barbara economist, said housing prices would probably change little, for better or worse, during 1996. “It doesn’t look like there’s any pressure for them to go either direction,” he said.

Like other Southern California county assessors, Gray is eager to see home prices rebound.

“We hope the bottom is near, because we need to climb out of this hole,” he said.