Potomac Property Assessments Rise Sharply

Potomac Property Assessments Rise Sharply

Property values went up 65 percent in Montgomery County according to the recent assessment.

George Barnes says his house is nice, but it's not that nice.

The immediate past president of the West Montgomery County Citizens Association was one of thousands in Montgomery County who received reassessments of their property for taxing last week.

"I had a recent appraisal and its nothing like what they say its worth," Barnes said. "It's way up. They're driving normal people out by this kind of assessment and maybe it's because property values are rising but still how can ordinary people deal with that kind of stuff?"

"I mean talk about affordable housing," Barnes said referring to more than a year of work at the County Council on increasing the county's affordable housing stock. The effort, which ended with the passage of new legislation in Nov., 2004 used teachers and police officers' salaries as a benchmark for housing affordability. "How about just normal citizens who have been here for 50 years?" Barnes said.

Property values for Potomac houses rose by 70 percent over three years, according to the Maryland Department of Assessments and Taxation.

Under Maryland law, all properties are reassessed every three years, on a rotating cycle of regions within each county. Potomac was part of the area reassessed for 2005, along with most of Bethesda, Chevy Chase, Olney, and parts of Wheaton. The 87,000 assessment notices mailed out Dec. 31, 2004 were calculated over the course of the preceding year and take effect for the 2005 fiscal year, which begins July 1.

The 65 percent spike in assessed values in Montgomery County, which includes commercial property, was tops in the state followed by a 56 percent jump in Frederick County and a 50.4 percent increase in Calvert County, with eight other counties rising by between 40 and 50 percent.

Homeowners will not be faced with a 70 percent jump in real estate taxes this year, however.

MONTGOMERY COUNTY CAPS annual property tax increases at 10 percent a year. The "Homestead Tax Credit" applies to all owner-occupied properties, regardless of the owner's income. Other property tax credits are available to low-income homeowners.

Rental and commercial property tax bills are not capped, but according to state law, tax increases are phased in by thirds.

For example, someone living in a house assessed at $200,000 in 2002 and $500,000 in 2005 would pay taxes based on an actual value of $220,000 in 2006, $242,000 in 2007 and so on — a 10 percent annual increase pending the next reassessment.

For a rental or commercial property with the same value, the owner would be taxed based on an actual value of $300,000 in 2006, and $400,000 in 2007, and $500,000, the full value, in 2008 (phasing in the assessment increase in thirds).

Property owners may appeal their assessments within 45 days of receiving the assessment notice by filling out the appeal form on the back of the assessment, by contacting their local assessment office by phone or e-mail, or online at http://sdatcert1.resiusa.org/Appeals2005.

"The appeal process is very property owner-friendly. It's made for the property owner to be able to represent themselves," said Laura Foussekis, special assistant to the director of the State Department of Assessments and Taxation.

"We know that interest rates are historically low and the supply and demand in these areas, particularly inside the Beltway are high right now, and people are paying the money to live in these areas," said Daniel Ercolani, assistant supervisor of assessments for Montgomery County.

"IT'S OBVIOUSLY a difficult balancing act," said Barnes, because "everybody wants more services." Still, he said, "They perennially override the spending limits that were imposed on the County Council."

"There are things that we still don't have in spite of the fact that they're charging us an arm and a leg. ... We're constantly fighting budget crunches for school budgets, we're battling overcrowded schools," he said.

Ercolani offered this advice to those receiving reassessments this year:

"I believe everybody should take a look at their full value, they should check to make sure that their homeowner's credit [is] applied. In this market so many people are aware of the values in their neighborhoods, so there's a lot of savvy in the general population right now.

"It doesn’t make it easier to take these large increases," he said, "but the bottom line the we have to look at is the valuation increase."

"If you look at the stats, we are the highest, but there are large increases in Anne Arundel, Baltimore County, Hartford County."