Fast Times at the Savannah Board of Equalization

Walking into the lobby of the Savannah Board of Equalization, I harkened back to the last book I read, Atlas Shrugged by Ayn Rand, and the hairs on the back of my neck rose. Regardless, I was there to protest the 105% rise in the assessed taxable value of my home over the year 2007.

I decided to utilize the negotiation framework in order to prepare for the hearing, which involved identifying the objectives of the players, considering our ZOPA, or zone of possible agreement, through an analysis of alternatives, and setting my reserve price, a real estate value which justifies my time and expenses in this ordeal.

My objectives:

• lower the taxable value of my home as much as possible to reduce my taxable burden,
• establish a precedent for my neighbors in the Lincoln Plaza Homeowners Association,
• be a good President for said LPOA by helping them reduce their taxes, and finally,
• avoid screwing up and raising my taxes , or worse, losing my homestead exemption.

Having not dealt with the BOE before, I reasoned their objectives:

• to help property owners get a fair value for their taxable burden,
• to assist the Savannah Property Appraiser understand the implication of his/her decisions,
• to raise the value of their own properties through defending the PA's higher valuations,
• to feel a sense of contribution, worth or power in their position on the Board.

To assist me in my negotiation, I had to create the zone of possible agreement and reserve prices:

• my property was valued at $290K. (how it appreciated from $135K in 2000 is beyond me) Worst case, if I was smart, my taxes are maintained at the $290K valuation.
• I wanted to reduce my taxes by at least as much as it took my time and resources, which amounted to a valuation revision of about $55K. (Multiplied by the millage rate, it gives me cash money in my pocket. ) If I got a revalue at $235K, I'd stand up, say thank you, and leave.
• the board's worst case is...wait! They have no worst case; no best case either for that matter! This is not a negotiation, rather a plea for mercy. Oh well, let's see what jedi tricks I can pull off to persuade them.

Reasoning (some good, some bad) why the board should reduce my valuation:

• The past two years have seen price declines of about 20% in the Savannah downtown area,
• There is over a year of inventory in the condo market,
• The current price level is that of 2004 of which I have LOTS of comps,
• It's difficult to value a property in such an old and variable city as opposed to a suburban subdivision,
• If they reduced my valuation, there would be many more who would forgo a protest (aka the other 10 owners of LPOA.)

Let's just say it didn't go as well as I had hoped. I did succeed in reducing my valuation to $268K and initiating a relationship with my PA, who gladly accepted my comps research. So, $22K times the millage rate equals out to about $220/year in tax savings, or about $155 after my tax credit is backed out. Not a horrible take. Plus hopefully my LPOA owners will benefit in years to be and not kick me out of office.

But back to this Board of Equalization concept. The real question is, "what should these board members be focusing on?" Obviously there is a position in the city government which fully compensates an individual for valuing properties. The position is titled Property Appraiser. Is this board merely an amateur set of homework checkers?

Do we really want our BOE to be composed of questionably trained/educated volunteers who think their main function is to uphold the PA's decisions, or do we want a compassionate "jury of our peers" who will consider the objectives of the taxpayer on a case-by-case basis and provide a check-and-balance for the seemingly all-powerful Board of Assessors?

Methinks the former is easier, and therefore, the path of least resistance. Another government dollar well spent. But I prefer latter.

But don't take my word for it. Another citizen was so dismayed by his experience that he wrote a letter to the Editor of the Savannah Morning News.

More insight to the Board of Equalization and the ilk it attracts can be found in this article seeking volunteers for the Board.