4/4/2013 8:00:00 AM YAVAPAI COUNTY ASSESSOR: Neighbor tips help officials find tax scofflaws
By using satellite imagery on the Internet, Yavapai County Assessor staff members were able to spot what appeared to be several structures on a property in Skull Valley. The photo on the right shows the limited view the staffers could see when they drove up in person. As is often the case with rural land, the structures are out of sight of the roadway.
Courtesy Photos/Yavapai County
The Yavapai County Assessor, like all of Arizona's assessors, is supposed to survey each property in the county every four years to ensure that the land and structures are being correctly taxed, and revalue all properties annually.
But with just 60 people in the entire department, and with 160,000 parcels in the county, it's not physically possible. Assessor Pam Pearsall said that, when someone pulls a permit with the county's Development Services Department for construction, the staff checks it out. If they don't apply for a permit, and fail to notify her office, the staff won't know.
That's important, because, as Pearsall said, people whose properties are assessed at a lesser value than they should be "are getting a break on the backs of the other taxpayers."
Twenty county appraisers conduct canvasses of neighborhoods, "going up and down streets," she said. "That's what they should be doing for all the properties (each year). But that doesn't happen because of resources. You can't afford it."
In Yavapai County, one of the major points of contention is the agricultural classification.
Parcels with an "ag" designation are taxed at a low rate - $25 per acre per year - and are supposed to be used for grazing livestock. Even growing crops is a classification with a higher rate.
The ag classification, Pearsall said, is sometimes abused by landowners who received the nod years ago but now are doing something different, or building new structures, on the land.
Development Services Director Steve Mauk said, "The use of property for agricultural purposes, on five acres or more, is exempt from the Planning and Zoning code" by law, so buildings erected on ag land don't need permits.
But they are subject to taxation, and Pearsall said, "You're supposed to tell me, 'Pam, I'm building a house, I'm building a barn.' But most people forget that."
Pearsall's staff relies on satellite imagery, available to anyone via the Internet, to tip them off to potential violations in rural areas, but the pictures from space - which may be two or more years old - don't tell the whole story. Still, Pearsall said, sometimes they're valuable. For example, one satellite photo marked, "No improvements listed, no permits shown, has been ag since parcel was created in 1999" appears to show buildings of approximately 2,200 and 350 square feet. Another shows what appears to be a luxury home with a large, grassy backyard and is labeled, "Building footprints approximately 4,900 square feet."
"It looks, from that photo, like a very expensive house," Pearsall said. "It's located on agricultural-classified property, and therefore didn't require permits."
If it is, "we're missing a lot of value," she said, by not correctly taxing the home. While ag-classified land is valued at $25 per acre, residential land "might easily be worth $3,500 an acre." And that doesn't include the value of the home itself.
But before any action can be taken, an appraiser will have to go to the site and check it out in person, because the satellite picture is not very detailed and may be misleading.
Pearsall proposed a pilot program of aerial photography by a company called Pictometry, which uses a fleet of aircraft to shoot photos specifically for valuation assessment, but the test project, with its $10,000 price tag, was turned down by the county Board of Supervisors. County Administrator Phil Bourdon said he "fully expects" the project to be revisited during budget discussions for the 2013-14 fiscal year.
Another way the assessor's office learns about potential violations is by tips from neighbors who feel the property owners are profiting unfairly by holding a classification they don't deserve.
One couple became suspicious of the land use on a ranch adjacent to their property, and reported that the ranch included a large quarry on what they believed to be agricultural land.
They were right, Pearsall said, noting that, because the U.S. Geological Survey satellite imagery of the ranch was several years old, the quarry does not appear on it. Staff who went out and looked at the land returned with photos of a fairly substantial rock-production quarry, one that could be considered a commercial concern.
Pearsall said the classification of the land is in question, because the ranch owners claim they still are grazing cattle on the land.
"(The owner's legal) theory is, because she hasn't fenced out the hole they're getting the minerals from, that the cows can still graze on it," Pearsall said, but her own theory is that the quarry, with its lack of fencing, is evidence that they're not grazing cattle at all because the quarry represents a hazard to livestock.
"As of today, I don't have any evidence that (the ranch) even has any cows," Pearsall said.
Pearsall said she has no way to know or estimate how much revenue the county loses from these kinds of violations.
But they do come with legal penalties. State law says that if the owner "intentionally provides false information, or fails to provide the notice required" he is liable for the difference between the ag value and the actual value for all the years the property was classified based on false information, and more significantly, "the owner shall pay a penalty equal to 25 percent of the additional taxes."
So far, Pearsall said, her office has not levied the financial penalties. "We've never done that," she said. "I don't think any assessor in Arizona has done it."
To this point, she's preferred to simply assess the property correctly and allow the county treasurer to collect the future taxes.
"We're just really getting into discovering that we have these kinds of issues on our agriculturally classified properties," she added. "I think we'll try to see how (pursuing fines) goes."