Hanover property owners call for redo of town’s sky-high assessments

Valley News Staff Writer
Published: 8/24/2019 10:13:45 PM
Modified: 8/24/2019 10:13:46 PM

HANOVER — A group of Hanover property owners are petitioning the New Hampshire Board of Tax and Land Appeals to force the town to redo its 2018 real estate assessment, saying a faulty methodology was used in the revaluation.

The petition, signed by 66 Hanover property owners, alleges that the Hanover assessor’s office “did not follow the law or standard assessing practices” when it undertook a townwide revaluation of real estate last year. Many Hanover residential and commercial property owners have been up in arms since they received their 2019 tax bills in which they saw their assessments leap more than 50% and in some cases nearly double over their prior assessment five years earlier.

In a stinging claim, the petitioners allege that in order to “force desired assessing outcomes” the assessor’s office “often used arbitrary and unsupportable data inputs to manipulate” its computer program that generates assessments. Moreover, the petitioners allege that many of the aberrant assessments seem to be the product of “sales chasing,” the illegal practice of using the sale of a property to trigger a reappraisal of that property at or near the selling price.

Specifically, the petition alleges that the town assessor juggled “two key levers” — construction quality grade and land values — to force or “back into” an assessed value to approximate a recent sale.

An example the petition cites is 10 Pine Drive, which sold for $980,000 in 2016. The property previously was assessed at $537,800 but in 2018 was reassessed at $968,600 — about $11,000 less than its sales price. That was done by raising the land assessment of the property from $255,500 to $644,800. As a result of the alleged sales chasing, the assessor’s office raised the land values of the other 10 properties on Pine Drive all to effectively identical levels, according to the petition.

“The consequence of this flawed approach is disproportionate and unfair assessments throughout the town of Hanover and an unusually large number of abatement requests ... the entire revaluation is irredeemably flawed and should be declared void,” the petition declares.

Dave McMullen, Hanover’s town assessor, defended the integrity of the town’s property revaluation methodology and categorically rejected any wrongdoing in the new assessments.

“For the record, there is no sales chasing,” he said via email.

The nine-page petition, which includes a report and analysis of the town’s revaluation and details what it says are wide discrepancies in the appraisals of dozens of comparable properties, was drafted by Hanover resident Richard Joseph and real estate broker and investor Bruce “Buff” McLaughry.

Joseph, who has worked in the real estate industry as an investor and licensed real estate broker and who has started a blog called Fair Tax Hanover where the petition and supporting data documents are posted, said the group wants the state appeals board to force the town to redo its property revaluation “only because the town was unresponsive to the petitioners.” He said members of the group “have spent months trying to alert town officials” to the assessor’s office allegedly not following accepted industry standards in preparing property assessments.

The petition shows how many adjacent Hanover residential properties that are virtually identical in size, topography and general features have markedly different land assessments, which unfairly makes some property owners in effect subsidize the lesser tax burden of others with similar properties.

For example, the petition cites 10 adjacent properties of comparable likeness, including 32 Rayton Road and 34 Rayton Road with a $90,000 difference in land value; 8 Hovey Lane and 6 Hovey Lane with a $260,000 difference in land value; and 6 Conant Road and 8 Conant Road with an $89,000 difference in land value. Differences in those properties’ previous land assessments were relatively de minimus, according to the petition.

“It’s not about paying less taxes,” Joseph said. “It’s about fairness and equity. Similar properties should have similar tax assessments and tax burdens.”

The townwide 2018 revaluation resulted in about one-third of all property owners seeing their tax burden increase, one-third remaining the same and one-third seeing a decrease, according to Hanover’s assessor’s office. Data used to calculate the revaluation was drawn nearly completely from the price of home sales during a 27-month period from January 2016 to March 2018, a period during which Hanover home prices experienced a sharp rise, according to the town.

Nonetheless, nearly 400 property owners — about 12% of the 3,400 properties on the town tax rolls but 35% of the approximately 1,133 property owners who saw their taxes increase, according to the town’s website — filed with the town for an abatement on their property taxes.

“In more than 20 years I’ve never heard of more than 30 to 40 abatements being filed,” McLaughry said during an interview at his office in Hanover last week. McLaughry said his father, the late Hanover real estate broker Robert McLaughry, who served nine years on the town’s Board of Assessors, would be “turning over in his grave” at the number of abatement filings following the 2018 reassessment.

McMullen, in his email, said that for the 2018 reassessment the town deemed a statistically driven “sales approach” as the “most appropriate” methodology to employ for the five-year intra-period property revaluation “with the ‘cost approach’ providing added support.”

“Both have been used in accordance with established and accepted practices,” he said.

“Analysis of sales subsequent to the establishment of the 2018 values continues to support that the new values are reflective of Hanover market conditions and that the 2018 assessments are fair,” he added.

John Lippman can be reached at jlippman@vnews.com.

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