Surveys sent for property assessments

Thursday, September 9, 2010

MERRIMACK – A dearth of commercial property sales in the struggling economy has left Merrimack officials reassessing the way they assess property.

For years, town assessment officers have looked primarily at property sales to determine the market value of commercial properties. But with fewer sales on record in recent years, assessors are now asking property owners to fill in the gaps.

A survey sent out last month asks for detailed financial information on the town’s 400 commercial properties to determine market values as the town approaches its property revaluation, scheduled for the coming year.

Owners are not required to return the forms, which ask for income and expense information, among other inquiries. But Merrimack officials think they are essential to determining accurate market values, as well as a fair tax rate, they said last month .

“There’s some misunderstanding out there about why we’re requesting this information,” said Town Manager Keith Hickey. “It’s just a tool for the assessing department to be as precise as it can in its (assessments). … It’s the same thing we always do. It’s just a different approach.”

The confidential surveys, one of three traditional methods to assess commercial property values, are common to cities and towns across the state, according to Stephan Hamilton, director of the property appraisal division within the state Department of Revenue Administration.

Merrimack assessors haven’t used them in about 10 years, deferring instead to property sales to determine property values, town assessor Michael Rotast said.

This year, however, town officials have recorded only five sales, not including foreclosures or exchanges between family members. Those figures have left assessment officers with “a smaller pool (of information) to draw from,” Rotast said.

“That makes it more difficult to make accurate (assessments),” he said. “Getting this additional information will assist us in being as precise as we can be.”

The decreased number of sales could not only result in outdated property assessments, but they could unfairly shift the tax burden upon commercial owners or residential homeowners, depending on the recent direction of the market, state and local officials said.

For that reason, Hudson, Milford, Nashua and other towns have long used the surveys, along with sales records and analysis, among other factors, to determine commercial values, assessors said.

“We do as all good appraisers do; we look at all applicable approaches,” said Marti Noel, Milford town assessor.

“Even when we do a (survey) approach, there’s a market and a sales component to it,” echoed Bob Gagne, Nashua assessor, who is a member of the N.H. Association of Assessing Officials. “We try to get all the information we can.”

At the Statehouse, lawmakers have worked for years to make the information surveys a required part of the revaluation process.

Earlier this year, a bill requiring property owners to submit the information sheets to town assessors was held up for further study in the state House of Representatives.

“There simply aren’t enough sales (in some parts of the state), so there’s no way to fairly value a commercial property,” said state Rep. Susan Almy, D-Lebanon, who sponsored the bill. “If we fall behind (the commercial market), we could be shifting the burden too much.”

Legislators could introduce the bill once again in the coming months, Almy said. But Merrimack officials don’t plan to wait.

After initially setting an Aug. 30 deadline on the survey forms, officials have extended the date. Property owners can submit the information sheets to the assessor’s office at 6 Baboosic Lake Road.

“We’ve received a few dozen so far,” Rotast said. “Every one helps. … It’s hard enough in a bad economy. We have to do everything we can.”

Jake Berry can be reached at 594-6402 or jberry@nashua telegraph.com.