Rehoboth Beach considers re-assessment
Property to be re-assessed in Rehoboth Beach?
Citywide property values last recorded in 1969
By Ryan Mavity, Cape Gazette, January 13, 2012
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The last time Rehoboth Beach had a property assessment, it was the year man landed on the moon and Bobby Clarke was drafted by the Philadelphia Flyers.
But now, the time may have arrived for the first citywide assessment since 1969. The commissioners have not decided to move forward with a reassessment, but they have instructed City Manager Greg Ferrese to put the costs of an assessment into the first draft of the 2012-13 city budget.
Three factors are driving a possible reassessment in Rehoboth: updating an outof- date assessment, the potential to get an assessment done for a very low cost and correcting inequities that have crept into the system.
The city considered reassessment before, including 10 years ago, but Mayor Sam Cooper said one reason it never moved forward was because of the costs, estimated at $300,000 to $400,000.
This time, however, Rehobothbased company PTA/DelVal offered to reassess property for $40 per parcel, or about $128,000, Cooper said. The city was working with the company on the periodic assessment of newly constructed houses when PTA/Del-Val representatives offered to do a citywide reassessment. The company has done assessments in Seaford and two years ago performed Milton's reassessment.
Cooper said the main goal of reassessment is to take a snapshot of what properties are worth. He said the major shift between the 1969 assessment and now is the price of land.
“The big disparity in Rehoboth is going to be, the land was relatively cheap the last time this was done. The buildings were relatively expensive, and that’s shifted,” Cooper said.
He said he expected to see situations where before, someone was paying $25,000 for the house and $7,000 for the land; now those amounts would be flipped, with the lot worth three times what the house is worth.
“What I don’t like is it will probably cut a big break for the people that have built McMansions because they have been paying relatively little for the land and a lot for the house, and now they are going to pay a good amount for the land and not quite as much for the house,” Cooper said. “It will be disproportionate for those who have small homes, because their land is so much more valuable.”
Cooper said inequities have crept into the system, not related to sales but for renovations and additions, which the city has valued too high over the years.
For example, he said, in 1969, vinyl siding was new and valued higher than wood siding. Now, wood siding is more valued. But if one homeowner wants to put vinyl siding up and another wants to use wood, the homeowner with vinyl siding will have a higher assessed value, Cooper said.
He said with all the changes to houses and properties over the years, it's difficult to know the value of individual properties.
Commissioner Stan Mills said the city charter allows Rehoboth to piggyback on Sussex County’s assessment. However, Mills said, the county has not reassessed since 1972. He agreed with Cooper that inequities have crept into the system, necessitating a reassessment.
“I’m leaning toward favoring it now because it’s the great equal-izer,” Mills said. “I think it will give us a truer assessment value and more fair values.”
Cooper said his plan would be to assemble the program in spring, have the assessment in the summer through the fall and have the new assessment ready for the 2013 tax bill.
“Obviously, everyone’s assessment is going to go way up; the city’s tax rate is going to go way down,” he said. Cooper added the city property tax rate could go down 5 cents, from $1.85 per hundred square feet to $1.80 per hundred.
While the commissioners acknowledged they could face a firestorm of criticism for what could raise people’s tax bills, all agreed that the system needed to be corrected.
Commissioner Bill Sargent said, “At some point, you have to say it’s just right that we go ahead.”
“I’M LEANING TOWARD FAVORING IT NOW BECAUSE IT’S THE GREAT EQUALIZER. I THINK IT WILL GIVE US A TRUER ASSESSMENT VALUE AND MORE FAIR VALUES.”
- STAN MILLS, REHOBOTH BEACH COMMISSIONER
