Tag Archives: property taxes

South Kitsap Fire & Rescue levy Q&A

After our Jan. 24 story on the South Kitsap Fire & Rescue levy proposal that will be on the April 17 ballot, readers had questions and raised issues that called for more information.

I contacted SKFR Chief Wayne Senter via email for a Q&A. In the interest of space, I have paraphrased portions of Senter’s replies.

The ballot measure calls for a temporary (six-year) levy lid lift or special levy that would replace the current special levy, expiring at the end of 2012.

KS: Let’s cut to the chase. How many employees would be laid off if the levy fails and how many of those would be firefighters?

WS: “Although no final decision has been made, the department anticipates a reduction in force of 20 full-time employees, including 18 firefighter-EMTS and 2 support staff. This would likely force the department to convert 3 of its 8 fully staffed stations to volunteer stations, meaning response times “will increase from 10 to 15 minutes depending on the exact circumstance. This increase would likely be deemed as a gross deviation from credible emergency response times and would result in de-accreditation (national fire safety standards) for SKFR. Longer response times mean more community risk.”

KS: You call this a “replacement levy.” How much do you anticipate collecting in 2013 if the levy passes?

WS: The same amount as in 2012. plus a 1 percent annual increase allowed by state law.

In 2012 SKFR’s combined fire and Emergency Medical Services property tax assessments will generate an estimated $12 million. The temporary fire levy lid lift that expires at the end of this year represents about $1.7 of that amount this year.

“It is that exact amount of money we seek to renew for 2013.” By that, he means $12 million is the base amount from which the 1 percent increase would be calculated. Separately factored into tax collection calculations is an amount attributed to new construction.

KS: What does that mean to property owners?

WS: This year (2012), the special levy accounts for about 27 cents of the district’s total fire levy collection rate, which is $1.38 per $1,000 of assessed property value. So the levy lid lift/temporary levy in 2012 costs the owner of a $250,000 home $67.50 per year. That’s the part fire officials are seeking to replace.

Besides the permanent fire levy and the temporary fire levy lid lift, 50 cents per $1,000 is collected for the Emergency Medical Services levy. Voters approved the six-year EMS increase in 2009.

So SKFR’s total rate in 2012 is $1.88 per $1,000 of assessed value.

KS: What would the rate be in 2013 if the levy passes?

The anticipated rate that will be on the fire levy lid lift ballot measure is $1.48 per $1,000 of assessed value. That’s the amount fire district officials conservatively estimate will be required to maintain the current level of funding.

Pinpointing the exact rate needed is not an exact science, however, because the rate for any given year is based in part on the total assessed value of property in the fire district, a variable that’s hard to predict. The fire district gets projections from the assessor that it uses in setting the rate.

“We plan to ask for a rate that will ensure we are able to continue the same level of funding from 2012 into 2013,” Senter said.

Suffice it to say that unless your home took a big jump up in value, due to an addition for example, the taxes you would pay in 2013 would be pretty much in line with what you’ve been paying.

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State issues report on county assessors’ workloads/appeals

The Washington State Department of Revenue has issued its annual comparison of county assessor statistics.

Property tax assessments were the subject of a recent debate between Port Orchard mayoral candidates Tim Matthes and incumbent Lary Coppola.

Topics that have surfaced during the debate include:
a. the accuracy and fairness of Kitsap County Assessor’s property valuations.
b. the possibility of a class action lawsuit on behalf of commercial property owners whose assessed values increased sharply.
c. the possibility of changing appeal laws/procedures to reduce the burden of proof on the property owner.

If either b. or c. goes anywhere, I’ll be following up on it. As for a., if I’m interpreting the DOR analysis correctly, it appears Kitsap County’s success rate/satisfied customer rate — judging from the percentage of appeals per properties assessed — is better the state average.

Now for the qualifying statement. Mike Gowrylow, DOR spokesman, specifically states in his press release, “Washington’s thirty-nine county assessors operate within unique local geographical, political, and economic environments that often influence the attributes of a county’s assessment system and the level of services they provide. Consequently, making direct comparisons between individual counties may result in distorted or misleading conclusions unless additional information is considered or more in-depth analysis is conducted.”

And yet, the report “is intended to provide property tax administrators and decision-makers with a uniform set of comparative statistics to assist in the analysis and evaluation of assessment operations and the adequacy of assessment resources.”

Also note: the numbers counties reported for their budgets, FTE levels, and appeals were as of a specific point in time (March 2011) and may have changed since then. The report also tallies assessed values, number of parcels, new construction, number of appeals and other relevant figures.

Kitsap County in 2010 had a total of 112,218 parcels and a total assessed value of nearly $28.2 billion ($28,158,972,045) representing 3.48 percent of the all-county total AV. Commercial properties (46 in manufacturing, 4,416 in commercial use) make up 4 percent of the total number of properties.

Kitsap’s average value per parcel is $246,986. The straight up state average for counties like Kitsap that do annual assessments is $177,056. The statewide weighted mean, in which data are given weighted values for a more statistically accurate description, is $256,918.

The DOR analysis looked at workloads based on staffing and number of parcels assessed. The Kitsap Assessor’s office lost 2.9 percent of its staffing between 2009 and 2010; the drop was 7.2 percent between 2010 and 2011. Statewide staffing decreases varied widely, with a number of counties showing no change between 2010 and 2011. Lincoln County’s staffing decreased by 20 percent. At the other end of the spectrum, San Juan County increased its staffing by 16.5 percent.

Looking at number of inspections per appraiser, Kitsap was about in the middle of the pack with 1,255. Douglas County had the heaviest load with 3,663. Garfield County had the lightest, with 302.

Check out page 36 of the document for a report of the number of appeals each county had in 2009 and 2010. Kitsap had 615 in 2009, with 64 appeals going to the Washington State Board of Tax Appeals. Kitsap in 2010 had 573, with 1 going to the BTA.

Statewide appeal totals were 35,162 county-level appeals in 2009, 3,480 BTA appeals in 2009, 24,299 county-level appeals in 2010 and 1,002 BTA appeals in 2010.

Looking at the percentage of appeals compared to the total of non-exempt parcels, Kitsap’s appeal rate was .55 percent for 2009 and .51 percent in 2010 among counties that assess annually (13 counties assess cyclically, less frequently than each year). The 2009 state average is .80 percent and the state weighted mean is 1.33 percent. Looking at the 2010 appeal rate, we’ve got .61 percent average statewide and a statewide weighted mean of .84 percent.

So Kitsap did better than average in 2009 and 2010, and quite a bit better than the statewide weighted mean in those years. I’m guessing that’s cold comfort to those who saw large jumps in assessment in those years.

Kitsap County does a detailed assessment, with a visual inspection of the property, every six years. Complaints typically result when the detailed inspection results in a jump in property value, as properties that have, according to the assessor’s office, been undervalued are brought into line with current comparable assessments.

The law states the assessor must value properties at “True and fair value,” which “means market value and is the amount of money a buyer of property willing but not obligated to buy would pay a seller of property willing but not obligated to sell, taking into consideration all uses to which the property is adapted and might in reason be applied.” The law goes on, “In determining true and fair value, the assessor may use the sales (market data) approach, the cost approach, or the income approach, or a combination of the three approaches to value.”

So, I’ll leave you with a question or two or three, “How (if at all) would you change the law on assessments, and why?”

“How, if at all, would you change the law on appeals, which currently requires the property owner to show ‘clear, cogent and convincing evidence’ the assessor is wrong?”

“What, if anything, do you think could a class action lawsuit on behalf of property owners who feel they’ve been unfairly assessed could accomplish?”

Thanks for your thoughts. Chris Henry, reporter

For annexation geeks only or … read the fine print

This post follows on my story about the Bethel Corridor annexation that ran Saturday.

Just kidding about the “geek” thing. Annexation is something everyone should be interested in because it can affect the services you receive and how much you pay for them, which was the point of the story. In fact, one of the reasons I wrote it at this time is that the father of one of my fellow reporters lives within the proposed annexation area, and he was wondering about the ramifications.

I wanted to add to this post some information from Port Orchard Mayor Lary Coppola that I wasn’t able to squeeze into the story.

But first, a correction. This comes as a result of the inquiring mind of Bob Meadows, who is a geek in the best sense of the word. Bob pointed out that the comparison of the city and county stormwater fees didn’t make sense, based on the rates charged under each jurisdiction’s code. The city’s first analysis compared county rates for a building with “multiple units” to city rates for a “single family residence,” which resulted in the confusion.

The correct information is: property owners’ net payments would increase with annexation by just less than $220 per year per $100,000 of assessed value if the annexation were in effect today. (I erroneously reported $150.)

Here is the city’s analysis of the comparative cost of living in the city and the county, with the correct figures.
Bethel Corridor Property Franchise Tax comparison-2010.
And here are the respective tax codes for the city of Port Orchard and Kitsap County:
taxcode- City of Port Orchard

There also are some differences in development codes between the city and the county, illustrated by the city-generated document below (the home is a real residence, used by permission of the owner). As you can see it’s a residential property, not commercial. Given that the Bethel Corridor is commercial and going to become more-so, residential property owners, considering the effects of annexation, may be thinking about selling and moving, or moving and developing properties to the allowed density. I’d be interested to hear from anyone in that boat; e-mail me at chenry@kitsapsun.com. Here’s the code comparison, which has links to both the county’s and city’s codes.
Bethel Corridor 1880 Salmonberry

And here’s the city’s proposed zoning for areas to be annexed:

Mayor Coppola, in his statement for the story Friday, made some noteworthy points. (The mayor outlines the potential advantages of annexation. There is no organized opposition to the annexation. If I hear of any I’ll give them equal air time.)

The mayor goes into greater detail than I did in the story on what would happen to the county’s Bethel Corridor Plan if annexation occurs. The city would use about half of the increased sales and property tax revenue from the annexation (expected to be about $1.4 million per year initially) for help fund the major road improvement. The city would also seek grants, and federal and state transportation funding (all of which I reported). Although the city may modify the plan somewhat, they would adhere to an aesthetically pleasing design since the corridor would be another “gateway” into the city,” Coppola said (which I didn’t report).

The mayor expects the revenue to increase with the eventual competion of two major retail projects, yet to break ground: the Walmart expansion to a Supercenter, and the construction of a Home Depot nearby. Coppola points out that these two projects could, to a certain extent, “cannibalize” some sales tax revenue from other stores in the city. This trend could be partly offset if the Bethel Corridor can attract shoppers from Gig Harbor, he said.

The story summarizes advantages listed by Coppola, including public safety, prompt permitting and improved road maintenance. He goes into some detail about the staffing and equipment needed to maintain the city’s current level of service.

As I said, I’d be happy to post other arguments for or against annexation (or you can simply comment on this post). Here’s the complete text of the mayor’s e-mail (note he mentions an estimated cost of $30 million for the Bethel Corridor under the county’s plan. The county’s website, however, still lists it at $43 million.)

Here’s the mayor:
The City Treasurer and the Finance Committee have vetted the Bethel Corridor annexation, after input from the Police Department, Planning, Public Works, Clerk, HR, and the Court.

The annexation will generate approximately $1.4 million in annual revenue, split between property and sales taxes. The Finance Committee has tentatively committed to put away half of that annual revenue for debt service on the widening project – which will end up being the largest public works project in the history of the City. We are already searching for grant opportunities and federal and state transportation dollars that could be available to also help defray the costs.

The County has done the engineering on this, and the last estimate I heard was about $30 million. However, that was in 2006 (I think) dollars. Considering the current state of the economy, I believe we could shave 15 to 20 percent off of that. Also, we haven’t seen the actual drawings, so we’re not sure what was included in the way of lanes, medians, landscaping, etc., so we don’t know for sure what opportunities there are for additional savings – if any.

Right of way acquisition is also an issue. We’re not sure if the cost estimates included that or not, but they should have. Also, any future commercial development will have to deed the necessary right-of-way to the City as a condition for permitting any development, which should help decrease the overall cost of the project. There will also need to be some re-engineering done, as the County has allowed some construction to encroach upon what should have preserved as right-of-way, so we’ll have to cross that bridge when we get to it.

With all this in mind, we have a budget of about $700,000 to support the annexation. We expect this to increase as development occurs. For example, the two big projects already in the works are Walmart and Home Depot. It appears the County will collect the permitting fees on these, but we will generate inspection fees, sales tax on the construction, and additional sales tax revenue once they open. Since we did our usual conservative budgeting, none of those gains are figured in our projections.

We also expect those developments will cannibalize some of the existing sales tax revenue we already collect. For example, Walmart will take sales away from some of the existing grocery stores, and Home Depot will impact Lowe’s and Scott McClendon’s Ace Hardware. However, we also anticipate a sales tax jump from all the local folks who currently patronize the Gig Harbor and Silverdale Home Depot’s, and think a grocery department at Walmart will attract some additional shoppers from Gig Harbor since they don’t have a Walmart.

As far as personnel goes, in consulting with all the departments, we have identified and prioritized our additional needs, and created a tentative hiring order.

In looking at the costs associated with this annexation, we will have to hire an additional two police officers, and equip them – cars, guns, radios, computers, etc., as well as train them. Since it takes on average about six months to get a cop from new hire to patrol-ready, we are already engaged in this process, and have identified the top candidates, and made an offer of employment to one of them. Currently, police response time is two minutes or less anywhere in the City, and we are committed to not to diminish that standard in any way.

The next immediate need will be for public works personnel. We are ramping up for that, as well as looking into purchasing the additional equipment we’ll need. One thing this does, is justify the cost of another snow plow, but there’s other equipment we’ll need as well.

It’s imperative to note here that water and sewer services for this area are not supplied by the City, but by West Sound Utility District. You may want to chat with Larry Curles and John Poppe about their plans.

The City Development Department will need at least one more person at some point, and we’re planning on that, as well as additional people in the Clerk’s office and the Court. As we learned with the Fred Meyer annexation, calls for police service will increase primarily due to shoplifters, so with the amount of retail involved in this annexation, we’re planning on the need for more time for the judge, an additional court clerk, and more time for the police officer who staffs the courtroom.

As far as taxes go, I believe Allan sent you a comparison sheet. However, since there is very little residential included in this, I’m not certain how valid such a comparison is in reality. I’ve also attached a comparison for the property on Salmonberry Rd. you asked about.

Finally, what’s in it for the property owner? The biggest positive is the police protection and Public Safety. There’s no way the Sheriff’s Department can match our response time given the County’s budget situation. Sheriff Boyer does a great job, but his people are stretched to the limit right now, so public safety is a big plus. As you recall, when the Walmart shooting happened, the Port Orchard Police were first on the scene when the call from the deputies went out. There’s a reason our crime rate is down over 60 percent since I’ve been Mayor – it’s a major priority. Port Orchard is a safer place to live, raise your family, and own a business than at any time in the past quarter of a century.

Another benefit is our permitting time and customer service. We have the shortest permitting time in the county – and unlike the County and some other Cities, we’re still open for business five days a week. Our people understand that they work for the taxpayers and customer service is their highest priority.

The Bethel Road widening will actually get done. It’s been on the County’s work plan since 1999, and I believe is listed as the 13th priority for the county – behind some trails and other things the County has deemed a higher priority – for 2011.

The roads will be maintained better – and snow plowing will happen sooner.

I hope this is what you wanted. Call me if you have questions.


Lary Coppola, Mayor
City of Port Orchard
216 Prospect Street
Port Orchard, WA 98366
(360) 876-7025 – Direct Line
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