Equalization for all?

Published 6:37 am Monday, June 23, 2008

“Comparables” worked against Troy Miller, but for Dan Hoffman when the Mower County Board of Equalization met last week.

Go figure.

Mower County Assessor Richard Peterson countered Hoffman’s argument for relief on the valuations of apartment complexes he owns at Dexter, Elkton and Adams with comparable valuations from other apartment complexes.

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When Miller, an Austin resident, pointed out there was no comparable data to use for a house that has been on the “for sale” market since 2005; Peterson argued other houses, whose valuations were over $100,000 and more than his were, indeed, valid when setting Miller’s house’s valuation.

Go figure again.

Hoffman and Miller will learn Tuesday when the Mower County Board of Commissioners meets in regular session whether their appeals before the Mower County Board of Equalization fell on deaf ears or not.

Hoffman’s last words on the subject were that he hoped they would be “objective” in their decisions.

The county commissioners and board of equalization are one and the same.

While Mower County Auditor-Treasurer Doug Groh also heard the appeals, Peterson, the Mower County Assessor, holds the most influence upon the elected officials.

“I’ve heard no additional evidence today that would make me recommend any changes.” Peterson said after all the appellants had made their cases Monday, June 16.

Not a good sign when the county assessor makes such a declaration before the board members have made up their minds. Peterson’s advice will be very influential in what the board members decide Tuesday.

Peterson’s side of story

Last fall, when the Mower County Assessor’s office informed more than 500 taxpayers they would no longer receive the lucrative agricultural homestead exemption — along with new valuations that showed property values had been adjusted upward by the county assessor — there was a furor over Peterson’s actions.

Peterson won except for the Minnesota Department of Revenue overruling his action to take away exemptions enjoyed by non-profit organizations such as the Southland Sportsmen’s Club.

Peterson said he was, in part, simply following the letter of the law as directed by the Department of Revenue. Secondly in way of explanation, he said he a previous long-time employee of the county assessor’s office had under-valued property and granted exemptions where they were not warranted.

The county assessor’s role in government is defined by the assessor.

“The county assessor is responsible for equalization of assessments throughout Mower County,” begins that explanation on the Mower County Web site. “The department accomplishes this by listing, classifying, and valuing all property subject to the property tax. Most of the activities performed by the department are requirements of state law.”

Double whammy

No one volunteers to pay more taxes.

In recent years in Mower County, the only appellants to win tax battles with the county and have their properties’ valuations lowered have been big businesses, most notably Hormel Foods Corporation, but including others such as Kmart Corporation.

An individual taxpayer has never won an appeal.

Last year, Kyle Klaehn won a “reprieve” and had his agricultural homestead exemption status restored by the state of Minnesota, but only for a year.

Klaehn returned to the board of equalization to seek to have the agricultural homestead exemption which the county assessor stripped from his rural Corning farm reinstated.

Klaehn was among the taxpayers reeling from the double whammy: property valuation goes up and agricultural homestead exemption is stripped.

A similar appellant is Mike Adams, rural Elkton.

Adams’ appeal focused on a claim that he doesn’t qualify for the minimum state requirement for tillable acres by one-tenth of an acre.

Adams went to the Farm Service Agency in Mower County to verify he has the minimum number of acres to qualify for the agricultural homestead exemption.

“The FSA said I had 10 acres and a smidge,” said Adams, a retired Chicago fire captain who lives in a house that is also the Ice Haus Inn bed and breakfast near St. John’s Lutheran Church.

Adams also has a feedlot permit and told the equalization board, “I was a farm, I am a farm today, I shouldn’t have lost the ag credit.”

His tillable acres are planted in hay crops.

Since losing the exemption a year ago and facing an uncertain financial future due to the new valuation and higher taxes, Adams has placed his bed and breakfast property — house, inn, historic barn, shed and a second house along the banks of Rose Creek — for sale, he said, for $1 million. He has had no offers to buy the property.

Adams has been a prominent figure in areas of tourism, economic development and public service, serving on the Mower County Board of Adjustment.

He has repeatedly raised the specter that valuations in Mower County are going up for a singular purpose: to pay for the new Mower County Jail and Justice Center project.

“I’ve been before you fellows four times in the last 14 years and I never get straight answers from anybody,” he said last week. “Just a few years ago Mower County had a big surplus of funds. Now, we’re told the county doesn’t have any money.”

David Hillier, 3rd District county commissioner, immediately refuted Adams’ remarks, including pointedly agreeing with Peterson’s assertions valuations are going up to meet the 90 to 105 percent ratio requirement.

After hearing Adams’ appeal and stinging criticism, Peterson said, “He still does not have the correct number of acres, according to the state’s definition.”

Then it became a war of numbers: Peterson’s this time after Adams supplied his own, during the appeal.

The Mower County Board of Commissioners will review the equalization board’s recommendation to accept or deny the appeals at Tuesday’s regular meeting, beginning at 11 a.m.

Letters were mailed Friday to each of the appellants informing them of the starting time for Tuesday’s all-important decision-making meeting.