Anderson County property values are decreasing to less than about 85 percent of their appraised values, and Oak Ridge appears to have several types of property that are selling for much less than their state appraisals, including older, low-priced homes and high-priced, high-quality homes, officials said.
All land tracts in the county also appear to be selling for much less than their state appraisals, the Anderson County Board of Equalization told Anderson County Mayor Terry Frank and county commissioners in a July 15 letter.
The board said the Oak Ridge properties selling for much less than their appraised values include low-priced homes built during the Manhattan Project era in World War II and high-priced, high-quality homes that are now unaffordable for most working-class employees. The Oak Ridge properties, as well as land tracts in Anderson County, appear to be selling at about 70 to 85 percent of the state appraised values.
“Because of the apparent decreasing value of our Anderson County and Oak Ridge residential homes as determined by actual sales, we may see a general reduction in the total appraised value for all of Oak Ridge at our next general appraisal adjustment in 2015,” the board said. “This would be an unprecedented event that would create a certified tax rate which results in higher individual tax bills.”
The July 15 letter to the county mayor and commissioners said the Anderson County Board of Equalization has completed its appraisal hearings for 2013 and has submitted its report to the Tennessee State Appraisal Office.
“The median reduction for all cases heard this year was -38 percent,” said the board. “This is the largest general reduction for this board ever.”
The board is chaired by Don Butler and the other members are James Ferguson, Larry Disney, Leonard Abbatiello, and Jack Rains.
“The Equalization Board has issued some sobering news,” Frank said in a Wednesday morning press release. “However, it is an excellent reminder that we need to stay focused on prudent financial management and pro-growth policies. With expansions like Omega Plastics in April 2013 and SL Tennessee in January of this year, as well as new developments in Oak Ridge and the movement on the Uranium Processing Facility project, I’m optimistic if we work extra hard focusing on growth, we can get through this challenge.”
She said she thinks the reductions are the expected fallout from the national economic downturn.
“However, I’m optimistic future growth in Anderson County will help us offset the loss of assessed value,” Frank said.
The Equalization Board’s purpose is to provide a due process for oversight, review and adjustment of property appraisals for property owners in Anderson County. Board members hold detailed hearings, assemble case histories and make adjustments as indicated, and the Board serves as a conduit between the Tennessee administrative judge and Chancery Court which can further review individual cases.
The board said Oak Ridge has had a total of 10 new residential building permits issued in the past year, while Anderson County has had a total of 58 new permits.
“Both are some of the fewest ever annually issued,” the board said. “The Anderson County total appraisal base has grown only 0.944 of 1 percent during the last year, and this is one of the lowest growth rates ever.”
The board said individual property appraisals are intended to reflect 100 percent of a property’s value in their appraisal year, but the same value is used for about five years and actual values change during that period.
“Appraisals serve the more important function of determining everyone’s fraction of the total property base and are the basis on which we share our revenue needs,” the board said. “In recent years, appraisal reviews have become much more demanding as the appraisal targets meet or even exceed 100 percent of the current sales value. We believe that property values are in most cases decreasing to less than about 85 percent of the listed Tennessee appraisal. A survey of area MLS sales indicate that these sales are closing within a range of 92 to 95 percent of the MLS listing price and most listings are below the Tennessee appraisals.”
The letter said the Anderson County Tax Freeze Program covers 1,092 properties, while Oak Ridge has 174 properties. The income base has risen to $38,800, which makes more people eligible.
“The lower family incomes and higher qualifying income level is making this program available to more individuals,” the board said.
About 38 percent of the value of Anderson County is in Oak Ridge, the board said. The county has 31,579 residential properties and 2,387 business properties.
Note: This story was updated at 1:20 p.m.