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Letter From DeWitt Supervisor, Edward Michalenko, Ph.D.

May 13, 2024

Dear Property Owners:

The purpose of this letter is to inform property owners of the rationale for maintaining property value assessments at market value.  The Town of DeWitt is one of only a few townships within Onondaga County that maintain a 100% equalization rate (ER).  The State of New York assigns each Town an ER annually based on the level of assessment within the Town against true market value.  An ER of 100% means your property is assessed at full value and hence is likely to sell for at least that amount in an open market.  DeWitt has maintained the State established ER goal of 100% at the behest of the Town Board since 1996.  The purpose of the ER is to maintain equitable distribution in property tax payments despite an incongruent application of property value assessments; each property pays its share of the overall tax burden. Failure of a Town to maintain an ER of 100% results in lower property value assessments but will not lower your property tax bill. The net effect of a lower ER is a proportionally higher tax rate.

For every dollar paid in property tax within Onondaga County, about 15% goes to your Township (including Villages), about 35% goes to Onondaga County, and about 50% goes to your school district.  Consequently, the ER assigned to any Town is applied to all parcels within the jurisdiction. The ERs assigned to Towns within Onondaga County range from 100% to as low as 3.5%.  Property owners within the Town with an ER of 3.5% pay a tax rate to Onondaga County over $131 per thousand while DeWitt property owners pay one of the lowest tax rates at just under $4.50 per thousand.  The same is true of school district tax rates.  Those assessed at full value have much lower school tax rates than those assessed below market value.  Many school districts extend across town jurisdictional lines and therein utilize differing tax rates imposed by the state assigned ER, which are intended to equally proportion tax obligations based on true market value.  For example, a property worth $200,000 in a Town with an ER of 100%, and therefore assessed for $200,000, pays the same amount of property taxes as a property worth $200,000 but only assessed for $100,000 via a tax rate doubled by the state assigned ER of 50%.

A home is one of the most important and largest investment people make. Yet for most of my lifetime, property values in Central New York have remained relatively static.  A study conducted by czb LLC, an award-winning real estate consulting firm found Syracuse home sales have been depressed for decades due to population loss, poverty, and job cuts; thus, prices are low thereby discouraging new construction and major renovations.  According to the Federal Reserve Economic Data (FRED), the median sale price of a single-family house in the United States (one-half sold for more and one-half sold for less) rose nearly 16-fold from $17,800 in 1963 to $479,500 in 2023.  Over the same period, the median single family house price in Syracuse increased only 8.5-fold to $151,000.  Today the CNY median single-family home price is 63% of the national average (Reddfin 2024).  Consequently, Central New Yorkers have not gained home equity afforded elsewhere.

Central New York is finally experiencing a recent and rapid increase in property values.  On a positive note, CNY property owners are at long last accruing some added wealth in the form of much overdue home equity.  If all properties within a municipality have a relative similar increase in value, the annual increase on the tax bill should be no more than the percent growth in the overall taxing entities budget.  Taxing entities include the County, school districts, special districts including fire, ambulance, water, sewer, lighting, drainage, among others. The Town of DeWitt’s budget is currently about 19 million dollars and has historically increased at an annual average rate of 1.5% over the last 16 years of my tenure as Supervisor.  About 75% of the costs paid to the Town are related to labor and maintaining the workforce for Police, Courts, Highway, Water, Parks and Recreation, Planning and Zoning, and the offices of Assessors, Comptroller, Clerks and Tax Receiver. The Town’s tax rate is established based on the Town Budget.  Should the Town’s overall property tax assessment increase 10% across the entire Town and the budget increase only 2%, then the tax rate will lower such that the average property owner would experience about a 2% property tax increase.  The increase in assessment has little effect on the increase itemized on your bill.  If your property tax bill has increased more than 2% for the nearly past two decades, then look to the annual increases in other governmental entities included on the bill; also note changes in tax rates, and the percent increase in overall budget. If a taxing authority’s budget does not increase, the property tax bill will not increase despite an escalating increase in property value assessments. 

Outside of setting the ER goal of 100%, the Town Board has no control other than appointment over an Assessor and cannot legally influence the Assessor. There is a separation of powers. The Assessor is independent of the Town Board. You wouldn’t want an Assessor beholden to an elected official; the system is designed to minimize the potential for cronyism and favoritism.

In closing, the ER is defined as the relationship of a property's assessed value to its full value.  For instance, an ER of 0.80 is set by NYS if property is assessed at 80% of full value.  DeWitt and other towns with an ER of 100% have the lowest County and school district tax rates in Onondaga County.  Failure to maintain an ER of 100% will not lower the overall tax burden and maintaining a 100% ER maintains fairness. The process of reassessing parcels annually on a continuous basis allows for property values to be lowered when market forces drop home prices, and help identify and lower assessed valuation for properties and neighborhoods of lower socio-economic status.  For further explanation of property value assessments visit: https://www.youtube.com/watch?v=_pw2HJUMytY.

Finally, should you feel your property could not garner a sale price equal or greater than your assessment, please register a formal complaint to the Assessor and grieve your assessment before the Board of Assessment Review (BAR) via the officially prescribed RP-524 form available at the Assessor’s Office on the second floor at Town Hall or online at www.tax.ny.gov on or before Grievance Day: May 28, 2024 (4:00 to 8:00 pm).  The Town of DeWitt BAR is an independent Board whose membership contains a variety of commercial and residential real estate expertise.  The BAR is charged with reviewing and adjudicating all complaints received on real property assessment; further the BAR has the authority to overrule the Assessor.  Be sure to bring a cogent justification of your reasoning and be able to identify a number of comparable properties to yours assessed at a lower value, thank you.

Sincerely,                                                                                  

Edward M. Michalenko, Ph.D.

DeWitt Supervisor

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