Written by Joe Rizza Friday, 15 January 2010 00:00
In an effort to reform a property tax assessment system he feels is broken, Nassau County Executive Ed Mangano unveiled his plan to repair the assessment system to lessen the burden property tax refunds have on the county budget.
Property taxes are viewed as the most serious issue affecting Nassau County residents. Mangano, who took office on January 1, feels that a more accurate assessment system will lead to a decrease in assessment errors and thus a decrease in the amount of money the county pays out for property tax repayments or certioraris.
The new county executive campaigned on having to fix the assessment system and now he will get his opportunity. “It’s one of the most significant issues affecting our residents,” said Mangano.
Just how serious a problem is the tax repayment or certioraris? According to Mangano, it presents a serious problem to not only the current county budget, but also future budgets. Tax errors currently account for nearly 50 percent of Nassau taxpayer’s debt. The county has $1.13 billion of its $2.45 billion of outstanding debt tied to tax certioraris. Debt service tied to tax certioraris accounts for $146.08 million of the county’s $308.92 million debt service on the county’s total outstanding debt in the county’s yearly budget.
The problem has gotten worse each year. In 2006, the county bonded or borrowed $1.1 million to pay for tax certiorari settlements whereas in 2009, the county borrowed $67.3 million.
Mangano feels the county needs to reduce the amount of money the county pays out each year for tax errors in order for the county to be on solid financial footing for years to come. “If we do not address and repair the property assessment system as soon as possible, Nassau finances will continue to worsen. That scenario is not acceptable,” he said.
His plan involves freezing the assessment roll at the 2010 level and then implementing a cyclical assessment system instead of the current yearly assessment system. A cyclical system would call for assessments property after a period of time that could be two years, three or four years or what is settled upon instead of yearly reassessments that currently take place.
With one of his first executive orders as county executive, Mangano formed the Assessment Review Team (ART), comprised of residential and commercial property owners and headed by Patrick Foye of Port Washington, an attorney at the law firm of Rifkin Radler where Mangano used to work, to analyze the system and issue a report by July.
“The county is facing an assessment apocalypse if this is not solved,” said Foye, who is serving as executive director of ART on a volunteer basis.
Mangano hopes that the opportunity to correct the property tax roll after taxpayers have had a chance to grieve their assessments will lead to a more correct roll and a decrease in tax repayments. “This will minimize the errors. Those errors, on an annual basis, [account for] $100 million [in the county budget]. If we start eliminating the errors annually, Nassau County will no longer have to bond and we would begin shrinking the $1.2 billion debt. We want to stop the annual bleeding and losses associated with refunds,” he said. “I am very confident that the lion’s share that the challenges and refunds will be reduced both residentially and commercially through this system.”
Mangano also signed an executive order instructing the county attorney’s office not to settle any commercial property tax certiorari cases that include an interest rate of greater than 3 percent. He believes the measure will save the county $1 million annually beginning this year.
Mangano’s political opponents, the members of the Democratic minority of the Nassau County Legislature, remain unconvinced that freezing assessments or using a cyclical assessment will provide any real tax relief to property owners. “I caution County Executive Mangano to proceed carefully,” said Minority Leader Diane Yatauro of Glen Cove. “As a legislator, I am somewhat concerned that the Mangano Plan may create more confusion among my constituents. Should I advise homeowners to file grievances now or wait until a later date? It may also raise false hopes that tax relief is imminent.”