||| FROM RON WHALEN |||
A recent posting argued the Land Bank isn’t the cause of increasing property taxes as there’s multiple nationwide factors. I agree with some of the reasoning, but an important element was missing. Many if not all of those nationwide factors don’t have a Real Estate Excise Tax(REET). Nobody is arguing the LB is solely responsible for inflating property taxes. What is being argued is the LB is a BIG contributing factor in San Juan County.
The following link connects to the Land Bank(LB) website with an outline on the LB impact of property taxes.
https://sjclandbank.org/wp-
It illustrates a perspective of how removing LB acquisition properties from tax rolls has little effect on property taxes. In the last paragraph is the sentence:
Being near conservation land boosts property values by up to 20% according to multiple analyses
Just a couple dots to connect here….What corresponds with increased property values? INCREASED PROPERTY TAXES! The impact on property taxes removed from tax rolls pales in comparison to the increase in property taxes caused by the increase in property values.
In 2015 the Zylstra Lake acquisition cost $3,000,000. The acquisition process in County code 2.120.050, Par. G prescribes “To obtain real property appraisals.” There was no appraisal. Two years later (2017) an appraisal was done for a grant application. The appraisal came in at $2,700,000 ($300,000 less than cost)
Following is a digest of data from County property records for 25 properties adjacent the Zylstra Lake acquisition.
Property ID Increase in Assessed Land value
- 16034 $119,190 = 61.83% in one year 2022 to 2023
- 15923 $206,480 = 65.91% in one year 2022 to 2023
- 16173 $128,480 = 59.3% in one year 2022 to 2023
- 16017 $228,560 = 94.61% in one year 2022 to 2023
- 16029 $116,450 = 52.54% in one year 2022 to 2023
- 16012 $160,820 = 81.39% in one year 2022 to 2023
- 16030 $112,650 = 42.9% in one year 2022 to 2023
- 16024 $97,740 = 33.29% in one year 2022 to 2023
- 16025 $226,65053 = 88.27% in one year 2022 to 2023
- 25657 $407,080 = 130% in one year 2022 to 2023
- 16224 $89,420 = 36% in one year 2022 to 2023
- 16219 $81,610 = 31.86% in one year 2022 to 2023
- 25282 $139,130 = 70.1% in one year 2022 to 2023
- 16220 $23,080 = 9.6 % in one year 2022 to 2023
- 16202 $73,820 = 39 % in one year 2022 to 2023
- 26376 $63,630 = 31.8% in one year 2022 to 2023
- 26375 $77,700 = 29.8 % in one year 2022 to 2023
- 26374 $32,700 = 10.7 % in one year 2022 to 2023
- 16195 $15,960 = 3.4% in one year 2022 to 2023
- 26396 $26,120 = 13% in one year 2022 to 2023
- 26397 $19,050 = 9.5 % in one year 2022 to 2023
- 16172 $106,560 = 44.8% in one year 2022 to 2023
- 16027 $42,630 = 31.39% in one year 2022 to 2023
- 16175 $75,680 = 30.4 % in one year 2022 to 2023
- 25435 $66,290 = 33.35% in one year 2022 to 2023
- 45.39% average increase in value 2022 to 2023
An average 45.39% increase in assessed land values for one year (2022-2023) for 25 property owners adjacent Zylstra Lake (LB) properties. The numbers correlate with the LB web site statement “Being near conservation land boosts property values by up to 20% according to multiple analyses”.
This is only part of the effect of inflated purchase prices for LB acquisitions. The cost of insurance raises accordingly.
Questions:
- What is the purpose of County code 2.120.050, Par. G that prescribes “To obtain real property appraisals”..? Wasn’t it suppose to assure acquisition prices represent market values? Paying higher than market artificially raises property values resulting higher property taxes.
- How many other LB acquisitions didn’t comply with county code 2.120.050(requirement for appraisals)?
- What was the property tax impact of that extra $300,000 paid for the Zylstra Lakeacquisition to nearby property owners?
- Isn’t the LB statement “Being near conservation land boosts property values byup to 20% according to multiple analyses” applicable to all of the 5000 acres of LB properties?
- Doesn’t this have a general effect on all land values regardless of being near conservation land?
You don’t have to be a property owner to feel the effect of increased property taxes. Renters feel it too as landlords have to raise rents to counter the effect of increased property taxes and insurance. The LB has done what they set out to do. They’ve accumulated enough property. The REET is authorized thought 2026. The LB should use the next 2 years to change their mission to suit San Juan counties present day needs. Enough already!
VOTE NO ON PROPOSITION 1-EXTENDING CONSERVATION AREA EXCISE TAX
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OK. This fog of data only applies to properties near conservation lands. For the vast majority of property owners, the property taxes that they pay are NOT affected by Land Bank acquisitions.
Few people understand how our county property taxes in Washington State behave in aggregate.
The total take of property taxes in our county is not allowed to increase more than 1.5% annually. This is less (recently much less) than the rate of inflation. If property taxes increase significantly in one area, they might remain flat, or even decrease, in other areas so as not to exceed the 1.5% cap on the annual increase in the TOTAL property taxes.
So this statement #5 is obviously untrue:
“Doesn’t this have a general effect on all land values regardless of being near conservation land?”
Please vote YES on San Juan County Proposition 1 to renew our wonderful Land Bank!
As the Land Bank purchased the Zylstra Lake property in 2017, does it make sense that the assessed land values of surrounding properties didn’t show significant changes until 2022 and 2023? No, it does not. A more accurate way to look at recent assessment increases is to look at the change over the Covid years as Covid refugees are responsible for much of the increases. If you look at the change from 2020 to 2023 you will find that many inland parcels had assessment increases from 100% to 150%, irrespective of their proximity to a Land Bank property. Some properties, like those near Zylstra Lake, saw smaller increases in 2022 and then much larger in 2023, while others had more uniform increases. Sometimes assessments lag because of insufficient sales in neighborhoods to support changes in valuation. Talk to folks on the outer islands who see major increases when there are finally sufficient sales for the Assessor to respond. If a property has a large increase in assessed value it does not mean that they are over-assessed, rather that they were under-assessed previously. So, two things are going on. Prices increased because of demand during the Covid years and assessment valuations likely lagged for a year or two.
As examples of lagging assessment values from Mr. Whalen’s list:
16017, 14.6 acres, 2022 land assessment of $241,580
16012 , 6.7 acres, 2022 land assessment of $197,580, only a point of contact with the Preserve
16025, 10.7 acres, 2022 land assessment of $257,500, 670 feet of lake frontage
25657, 30.1 acres, 2022 land assessment of $312,910
We can probably all agree that these properties were significantly under assessed in 2022.
As for the Land Bank reimagining themselves to “change their mission to suit San Juan counties present day needs”, the land bank in 2023 spent $2 million on stewardship. Unless the change of mission is to eliminate stewardship of the Preserves and end public access, that is going to require funding and where is that funding going to come from? If the REET is eliminated, that pretty much means increasing property taxes. To support current operations would require about $100 in additional property taxes for a $750,000 parcel. As has been discussed many times, ending the Land Bank REET also ends the Affordable Housing REET. Replacing that from property taxes would require another $100 a year from a $750,000 property. The folks against the Land Bank REET renewal are not telling the whole story and if successful, they will likely cause your property taxes to increase.
Please Vote Yes on San Juan County Proposition 1 to renew the Land Bank REET!