Lee RoodDes Moines Register
Lines outside the assessor’s office in Polk County's administrative building in downtown Des Moines have been long in recent weeks as about 6,600 property owners filed protests amid the highest average tax assessment increase ― 22% ― seen in recent history.
Young and old, rich and poor, in wheelchairs and with babies, residents unhappy with the county’s new two-year assessment of their homes’ values have been making their cases to two five-member panels made up of members of the county’s board of review.
The trend of the past four years suggests many will end up disappointed.
Polk County Assessor Randy Ripperger said historically, around 50% to 60% of protests filed every year result in some relief. But that figure has been declining: In 2019, 51.5% of protests were approved; in 2020, 44% were approved; in 2021, 38%; and in 2022, 33%.
More: Polk County employee challenges county's assessments of 23 properties
The board has until the end of June to hear the flood of 2023 protests, An epic, pandemic-driven run on real estate drove prices to all-time highs, but then a steep rise in mortgage interest rates caused the housing market to cool late last year, prompting many owners to question whether their properties would still fetch a much higher price in today's market.
So far this year, Ripperger said, 50.7% of protests have been approved and 49.3% have been denied. But it's too soon to say whether the uptick in approvals will persist. Asked if he thinks the number of protests in a given year affects board decisions, Ripperger said he didn’t think so.
Those who do their homework tend to get a break
Last week, Watchdog sat in on several in-person protest hearings, which board members strive to keep to around five minutes, For those who do their homework and find problems with assessments, the hearings do prove fruitful, Watchdog found.
By showing recent appraisals that differ with the assessor’s estimate of fair market value, key differences in valuation among neighboring properties, or problems with the comparable properties the assessor’s office used to determine new values, many residents managed to knock off several thousand dollars ― or sometimes tens of thousands ― from their 2023 assessment.
Among them was David Frank, who challenged the assessment for his and his wife’s home on Northwest Cedarwood Drive in Ankeny. He pointed out to the board that other homes on his block have more square footage and more upgrades.
More Watchdog: Iowa Baptist missionary convicted of felony sexual abuse after giving 4-year-old gonorrhea
“We’re not trying to plead poverty … but no one else’s was that high,” he told the panel members.
The board, after examining neighboring homes and sales, voted to reduce Frank’s assessment to $386,000 from $409,700, a 6% drop.
Another Ankeny resident, Leah Preisser, said she and her husband purchased their spec home on Southwest Abilene Road in October 2022 for $655,000, but it was assessed at $697,800. She said more neighboring homes have higher-end upgrades and the housing market changed during that time: Now, homes listed for sale in the neighborhood in the low $700,000 range aren’t moving.
The board voted to lower the assessment to the purchase price, also a 6% drop.
Liz Goodwin, an attorney and one of three members on Iowa’s Property Assessment Appeal Board, also successfully challenged the new assessment for her home on Arapahoe Drive in Des Moines. The board Goodwin sits on hears appeals from boards of review around the state, including Polk’s.
Goodwin said she and her husband had an appraisal done last May on their single-story, contemporary home in the South of Grand neighborhood, which came in at $700,000. But their new assessment was $759,000. Meanwhile, neighbors with a smaller lot sold their home recently for $510,000, she said.
On the recommendation of board of review member Amy Larson, an appraiser who runs Larson and Associates, the board adjusted the assessment to $735,000, a reduction of 3%. Larson said she didn’t know Goodwin; another member who did abstained from the vote.
More Watchdog: Did an Iowa educator's drinking after the last day of school put his daughter at risk?
Larson said she made the recommendation to lower the assessment based on her understanding that values were rising about 1% a month at the time the couple had the appraisal made last year. She said she added 5%, or $35,000, to the appraised value because last October ― five months after the appraisal ― was when the local housing market began to slow due to higher interest rates.
“We had fewer people out there buying homes after interest rates went up,” she said.
Argue specifics for your property, not whether the system is flawed
Watchdog observed that residents were less likely to gain relief when they paid more for a home than the new assessed value, when comparable home sales in the neighborhood suggested the new assessment was appropriate ― or when they showed up looking to protest something besides the specifics of their own property.
Just before Dr. Kirk Smith’s meeting with the review board this month, the semi-retired physician handed out fliers to others in line that read, "Dear Neighbor: Did you know that most of the members of the Assessment Board of Review are part of the real estate industry and stand to personally profit from the over-valuation of our properties when residents have to sell their homes because of excessive taxes? DO NOT ALLOW THIS ABUSE Call the Mayor and your council member to protest. Demand reform of the Board of Review.”
The pamphlet also encouraged residents to support a bill, passed by the Legislature and signed by Gov. Kim Reynolds, that would cap property tax assessment increases in future years.
“Do not let happen to Des Moines what happened to Austin, Seattle, and San Francisco, formerly nice cities that became unaffordable and unlivable,” it read.
Smith came to his hearing attempting to make his case for lowering a $143,500 increase in assessment for his 3,000-square-foot, two-story South of Grand home on Lincoln Place Drive. But he said he didn’t get very far after sharing his concern that he and his wife might not get a fair shake from a board made up of people who he believed had a built-in conflict of interest.
More Watchdog: Polk Supervisor McCoy sues fellow supervisors, county administrator, alleging conspiracy
He said one board member, who owns a local appraisal company, snorted derisively at him. Then another member, retired real estate broker Jane Viggers, told him his new assessment would stand, and gestured at his pamphlet, saying: “You can take that thing with you.”
Smith was so irked after the hearing that he contacted Watchdog, suggesting authorities should investigate“self-dealing” by board of review members and saying he believes more members should be recruited from outside the real estate industry. A former Texan, he said he’s convinced the makeup of local boards of review in Iowa leads to corruption, allowing people who stand to profit from high home values to call the shots.
“Who better to watch over the sheep than a wolf?” he asked.
But Ripperger said he thinks most people would want the people making decisions about their property values to have expertise in real estate.
Across Iowa’s 99 counties, boards of review are appointed by a local conference board consisting of county mayors, school district representatives in the county, and the county supervisors. The setup is supposed to ensure members don’t have a vested interest in the outcome of cases. Boards of review are charged with making sure properties are objectively worth 95% to 105% of fair market value.
Iowa Code requires boards of review, as nearly as possible, to include at least one real estate broker and one architect or person experienced in the building or construction field. Countywide boards also are supposed to include at least one member who is a farmer; no more than two board members can be in the same profession.
More Watchdog: Des Moines woman finally gets lottery winnings from check bank refused to deposit
Polk’s current 10-member board of review includes a commercial broker associate, a real estate agent, a retired real estate agent and two appraisers. It also has members who aren’t in real estate, including a CPA, an attorney, a retired labor union rep and a farmer. And it includes former longtime Polk supervisor John Mauro, an influential Democrat whom the county describes on its website about the board as a “builder.”
Larson, who has served on Polk County’s board of review for eight years, said members often make unanimous decisions, but sometimes split.
“If (residents) did their homework, I will go with the homeowner,” she said. “But sometimes the homeowner thinks they did their homework, and our job is to educate them a little bit on differences or why their comparable sales didn’t work. … Some people also just want to come in to vent, which is understandable. It was a crazy, crazy two years with a large adjustment.”
If residents have problems with how the system works, she said, they should contact their state legislators, who make those decisions.
New property tax law should help
Most people protest their assessments because they don’t want their property taxes to go up. But assessors say they are charged with determining the value of properties, not the taxes.
And as high as this year’s assessment hikes have been across the state, researchers have said there is some evidence property taxes in Iowa were not excessive before the Iowa Legislature took action to cap them even more tightly this year.
Total property taxes as a percentage of personal income in the state have remained around 3.5% for about the last 20 years, according to research conducted this year for the Iowa Policy Project. Researchers Peter Fisher and David Swenson also point out that the new property tax bill signed by Reynolds gives the state unprecedented control over budgeting decisions of local elected city councils and county boards. They note that growing cities often see a rise in demand for services.
A central feature of the bill Reynolds signed is a provision that limits how much money cities and counties can take in each year. The bill divides cities and counties into three tiers, based on whether their revenue grows by less than 3% annually, from 3% to 6% or more than 6%.
It establishes a new formula that requires local governments to use a portion of the excess growth to reduce property taxes to maximum tax levy levels set in Iowa law. If a city or county's revenue does not grow, it would not need to reduce its levy.
More: Check out Des Moines metro's top-selling homes: 2022 nearly matches $1 million-plus record
The mechanism for using excess revenue growth to lower property taxes will sunset after four years unless lawmakers take further action. Legislators have said they expect the new limitations to blunt the growth of Iowans' upcoming tax bills.
The bill also provides an additional $6,500 homestead property tax exemption for Iowans 65 and older. And it more than doubles a property tax exemption for veterans, increasing it to $4,000 in taxable value.
Still, it's impossible to know for certain how much more homeowners will pay in property taxes in late 2024 and the spring of 2025 because budgets for those years are not yet certified.
Polk County offers an "Estimate your Taxes" link on the assessor's website that gives property owners a "ballpark" estimate of what the taxes will be based on the 2023 assessments ― assuming the consolidated tax rate doesn't change and that its estimate of the state rollback percentage is correct.
Residents who aren't happy with the board of review’s decision can appeal to the Property Assessment Appeal Board or district court.
If a county's aggregate valuation is not within 5%, the revenue department orders the county auditor to increase or decrease the aggregate valuation to be equivalent to 100% valuation, as determined by the department. In odd-numbered years, when an equalization order is issued by the Iowa Department of Revenue, property owners may file a written appeal in the fall.
For more information, call the county assessor.In Polk County, that's (515) 286-3014. You also can go toassess.co.polk.ia.usand click on "Investigate your assessment" for help in preparing an appeal.
Lee Rood's Reader's Watchdog column helps Iowans get answers and accountability from public officials, the justice system, businesses and nonprofits. Reach her atlrood@registermedia.com, at 515-284-8549, on Twitter at@leeroodor on Facebook atFacebook.com/readerswatchdog.
