MINUTES OF THE VALA DIRECTORS MEETING
MARCH 3, 2010
President John Fike called the meeting to order at 9:00 a.m. A listing of attendees follows the minutes.
A motion was made by John Cristman to approve the Secretary’s report. The motion was seconded and passed.
The Treasurer’s report was read and accepted on a motion by Lisa Truchon as follows:
|Rental Mtg Space||175.00|
|Balance 02/28/10 General Fund||4,157.50|
|Balance 02/28/10 Education Fund||1,000.00|
|Balance 12/30/09 Checking Acct||$5,197.50|
|111 Memberships have been paid currently|
Louise also reported on the activity on the VALA website—145 visits, half of whom were from Vermont.
Chuck was complimented for his excellent upkeep of the website.
John reviewed briefly his report and expressed gratitude to Tom Vickery and Randy Viens for the time they have spent on H.485—the Current Use bill. We have yet to see what the Senate will do with the bill.
H.375 which had to do with some Listers giving land with VAST trails a higher assessment— there were not a lot of facts given—mostly hearsay and innuendo. If Listers can back up their values by sales, that is acceptable, but if they cannot then it is an issue that needs to be addressed locally. Legislation to exempt property located near trails may be included in the Miscellaneous Tax Bill, but Bill and John both expressed concern that once one exemption is granted, it opens the gate for others. To pass legislation to appease one pressure group at the expense of everyone else is not good policy. VAST feels that if land is assessed higher because of the trails, there would be a reluctance by the property owner to allow the VAST group to make trails on their land and as a result, they are pushing very hard for legislation to pass.
The Reappraisal Contract Guidelines is on the VALA website—thanks to Mark Paulsen for getting that put together and on the website.
The Lister of the Year committee made up of the current President, past President, and Current Lister of the Year will be contacting Town Clerks, District Advisors and others for suggestions for the 2010 recipient for the award.
John and Bill Johnson will be meeting on March 8th for more discussion on electronic property transfers.
They also will be working on finding financing, approximately $25,000.00 for the ongoing priority list for NEMRC and CAMA.
The Annual Meeting Committee will be meeting immediately after this meeting. If anyone has any suggestions about format, speakers, etc. let us know.
Steve Jeffrey: Introduced Cory Gustafson who has been working with VLCT since December helping in the Legislature. An area where a lot of time is being spent is Current Use. It is still up in the air what direction the Senate is taking. There is pervasive talk in the Legislature about Listers over assessing current use enrolled property for the purpose of skimming the difference between reimbursements for towns. This started with the group that put together the current use proposals for this year, has continued unabated, and has spread through the Legislature. The accusation came about because the landowners don’t appeal the assessed value because it doesn’t really impact them but it does impact the state since the state pays the difference between the fair market value and current use value—there are a lot of accusations that every town and Lister is operating in this manner. Hopefully VALA will address this situation. It was noted that there is provision in the law that if a town is doing this, PVR can challenge the value and correct the town’s actions. However, to say that this practice is rampant through out the state is not right. There may be a few guilty towns but it is not a statewide practice. When testifying before House Ways and Means, Tom Vickery responded to the accusation that Listers are putting artificially high values, that they are not artificially high values, they are fair market values. People are buying land at fair market or higher, and using the current use program as a tax shelter until such time as they develop it. Since the sales are used by PVR to develop the equalization study, it is assumed that they feel they are valid sales. The committee may call it artificial, but that does not change the price that people are paying for land.
The Legislature is looking at reimbursements and has done an analysis of per acre reimbursement—which has nothing to do with what the reimbursement is. They feel there should be an equalized reimbursement amount for every acre throughout the state and that land values or the municipal tax rate should not matter. This shows the Legislature does not have comprehension of value—there is no statewide average. Listers need to spend time with legislators to educate them. The state wants a one size fits all formula to apply throughout Vermont. This would be one of the worst things you can do with land since there is so much difference from town to town. However, the trend at the Legislature is to make one formula to fit everything. This attitude shows the difference between a statewide view and what is actually happening on the ground.
The Education Tax Rate is being level funded at $8544 per pupil. The Governor’s plan would lower the tax rate by 1cent. The Tax Commissioner has recommended a 2-cent increase in the school tax, but he can only recommend and the Legislature can do what they want. When Tax Commissioner made that recommendation, he assumed that school budgets would increase 2%, but in fact, they actually went down. Initially this would saved about $20 million, and $10 million could be used to reduce the tax rate….so maybe it will go up only 1 cent from last year unless the Education Fund gets “harvested” for other needs or used to reduce the amount of the General Fund’s contribution to the Education Fund.
School districts are getting less revenue; there is less money in the fund from non property taxes–$26 million less in the Education Fund last year due to cuts in General Fund assistance, no increase in rooms & meals or sales taxes; lottery input, and the elimination of $6 million from Medicaid. Therefore, a level funded budget will still increase because what is going into the fund is less. In addition, a decreasing school population is causing the tax rate to increase—the school population is decreasing 1% each year.
A primer by Joint Fiscal Office and the Department of Education is sent to legislators to educate them. Steve will send this to Carol to distribute via the list serve.
Bill Johnson: Bill has talked to about six committees on the issue of evaluation of land enrolled in Current Use. He has told the Legislature that this is not a systemic issue. The concern in the Legislature is about lack of uniformity in reimbursement from town to town. There are reasons, so there is a need to look behind scenes to see why. Also of concern is land with conservation easements– there is the perception that valuation of remaining rights and interests of land with easements are also not being fairly assessed. They feel there is a problem at some level. The Agriculture Committee feels that PVR should go to a town, take it apart and change their grand list for all of the current use properties to set an example. VALA needs to start a discussion and expand it to the higher assessment community in Vermont, and take it to the folk in Montpelier and explain to them that what they don’t see is the other side….current use land is actually undervalued, that all value being put on excluded land. We need to think about this and start a discussion.
This year there is a bill allowing building of a solar energy plant on enrolled current use Ag land—it will remain in the program with no penalty. Some feel methane digesters should become farm buildings—could stretch it to a farm production facility under present law and 75% of the manure would have to come from the farm; they would not be enrollable as farm buildings by themselves but would be considered a secondary production facility with the first $100,000 of value being exempt. There is limited oversight that every building that is enrolled is actually eligible—additions, etc. The property owners don’t have to submit new applications for remodeling or additions to existing buildings but only for new buildings
The Senate is stalling the process to the point that house proposal will not work because there will not be enough time, at least that is the latest theory.
There will be a meeting on March 8 on the online property transfer tax system. Copies of what the form will look like will be available for that meeting. There will be an opportunity to look at a prototype to see how the system will actually work.
Goal is to be up and running next January as a voluntary system. We need to build a system that accommodates lawyers, so that they will use it. Bill is envisioning that at closings something will print out like the old two sided forms to be signed by those doing the transaction, and then forwarded to the town. The town will get hard copy of document at time of recording.
A question was asked, “Can the Legislature adopt the Governor’s budget and bypass the $1.6 million that is needed”? The answer was “yes”. His budget didn’t require the cut. $1.6 million comes out of last year’s legislative budget. One proposal was some kind of fee to be collected with the tax bill. Fee probably will be by owner or by acre, but the question is how it is to be collected. Is the moratorium dead? Probably. The Senate doesn’t want it, but the House passed it. The longer this gets pushed out the harder it will be to implement anything but a relatively simple thing like a surcharge. Senate said they didn’t like anything the House did, and said they were going in a totally different direction. One good thing, we are working together, that is, VLCT, the coalition, VALA–trying to resolve issues, but the Senate cannot seem to come up with anything with which to agree with what the House passed. This was supposed to have been a done deal by the end of February. Probably will be end of March before anything is implemented.
Education TOEC: Todd said that one session John Vickery is working on is the market approach as applies to appeal situations. He is still looking for assistants and if anyone would like to assist, just email Todd or John V. Todd says that it gets easier every time you do it. The TOECs will be returning to their original format with four clear choices for Listers, including the Listers’ forum. Last years format was supposed to be more universally appealing to different departments—Listers as well as Librarians, Treasurers, Planning Boards, Select boards, etc, but it didn’t work out because the main ones who attend TOECs are Listers and last year it was perceived that was nothing for them. There will probably be a session on current use, maybe a double block of time; a slot for VALA, and the Listers’ roundtable.
Tom Vickery———no one knows where current use is going….the House passed a bill and maybe the Senate will pass a version of their own. VALA supported most of the House version.
The House passed the moratorium and the floating 2 acres for the house site. The Senate didn’t like moratorium, and wants a surcharge of some type. But, how to bill it and on what does the surcharge apply? Should it be billed with the tax bills; should the surcharge be per acre, per parcel, or per owner? Many thoughts being thrown around, but no decision made.
Tom feels that any Land Use Change Tax will not be in effect until next year if at all. He would like to see the program corrected back to its original intent, which would remove many of the abuses. There are so many people and departments involved, with so many points of view, it will be difficult to get a consensus. One concern about the surcharge, it could be opening the doors for the state to add surcharges whenever there is a need for additional revenue.
John F—the problem is that the Senate does not want to cut from any one, they want to please every interest group, they want no one hurt, no one to bleed, they don’t want to make a decision, and don’t want to impact anyone. The Ag Department says the whole thing should be thrown out and started over. Nevertheless, it remains that the $1.6 million has to come from somewhere. The House version would have affected the fewest number of people. It has been a very frustrating time. The intent of the coalition has been watered down to the point of being unrecognizable. The Forestry Dept. doesn’t want a moratorium and they do not want the surcharge to be on a per acre basis. Any time a surcharge is discussed, farmers are exempted. Also noted was that the amount of $1.6 million which is needed this year, will also be needed next year plus whatever additional cuts or revenue generation, and that will be even more painful. However, the Legislature is only looking at the next 2 months. The Land Use Change Tax is one year behind what is actually happening. The LUCT which generates $600,000-800,000 in penalties will rise to $6-8 million –they don’t want to see that far ahead, but the Legislature and the Governor know that next year the deficit will be bigger than last year or this year.
We will keep everyone informed on what is going on with Current Use. It is scary when we realize their lack of knowledge of what they are actually working on. They do not understand land values nor realize that the amount that has been set for current use values is an artificial number, created by a committee.
Microsolve/CAMA recommended changes have been pretty much done. Ed saw first cut….some problems…conversion from existing files back to current new revision, is a tough issue, still ongoing, but making progress.
There is still the issue of data, notes, comments on commercial property cards. Any questions or issues on commercial system, Ed will be glad to field them
Noel: Property record card improvements—nothing yet. CAMA/NEMRC merger still has some things to work out, but overall is going well. Webinars…everyone is encouraged to take part. Michelle is going to try to get an IAAO webinar soon.
Dave Tanner—error message—not a big issue, just let IT know and it only takes 20 min. to fix. If anyone needs guidance on buying a new pc, check the NEMRC website. It was recommended to Dave that when there is something like an error message that might come up on the pc screen, IT is urged to send an email letting Listers know what these messages mean. Communications are extremely important, end users are at different levels of knowledge……..many Listers come in at night when there is no IT available to call.
Mark: The new education schedule will coming out over e-mail or hardcopy. In addition, the schedule for whole year will be put out on the VALA website, plus on the newsletter that will be forthcoming from VALA. They are trying to keep the cost low, always looking for new affordable venues. Listers are encouraged to use the education money for Lister training, but again, NEMRC classes are not included. Discussion followed as to why NEMRC classes should be excluded. Money is to be used for maintaining the Grand List. Many times, new Listers don’t know that money is available. There should be a separate fund for money for maintaining Grand List, but there are still towns that are not keeping the money for reappraisal and Lister education separate from their general fund. Articles will be included in the VALA newsletter to clarify this issue.
Camilla: Covenant housing……Rockingham is going to meet with legislators but they have decided not to push this year since enough information was unearthed to show the inconsistencies of values among towns. There is enough evidence by sales to return all covenant housing to fair market value so that there should be no need to change legislation the way it is written.
New Business: Since the Legislature feels that Listers, statewide are over assessing current use properties, John would like to hear input from the group or anyone else we can talk to with any ideas of how we can put together a program to disprove this. He has not thought of a practical way of doing this, but we need to head it off. We need to be proactive in getting some type of information to show we are tying to do the right thing and perhaps form a committee to see how we can best approach this. Tom Vickery, Lisa Truchon, Bob Gibney and Ed Clodfelter volunteered to be part of the committee. Mark P said that one thing Mary Jane Grace does every year is to produce a report that shows the use value and reimbursement for current use parcels so towns get the hold harmless payment. That is the data that the legislature has gotten all excited about—it shows the per parcel reimbursement and when the calculation is done to show the per acre value, this is when the anomalies show up. The committee could look at data we have and see how it is being used and if there are any abnormalities, and see how they can be identified. In addition, the committee needs to be proactive in creating a presentation for the Legislature that this is how we look at it, this is how they should look at it, and provide them with direction rather than having them take their own direction which is not a good thing to do. Hopefully this would help them understand that many things affect land value, and there is no one size fits all formula.
Annual Meeting……..any ideas on a change in format, or ideas you want considered, etc email Carol.
There will be a guest speaker in May.
Tom V. 1. Concerns about concessions in sales prices not being recorded correctly on the PTTR—there may be concessions to bring down the sale price to make it acceptable to the buyer; but the sales price listed on the PTTR is the higher amount, before concessions were given. It would be good idea for the Property Transfer to show any personal property included and concessions in sales price. PVR uses the higher amount which in turn affects our CLA.
2. Concerns about the effective tax rates listed on page 87 of the Annual Report of the Tax Department. It is always a year behind, and someone could interpret the data incorrectly. He would like to see a committee set up to look at the definition and see what the rates are and see if what is in the report is correct. It is a matter of definition, but needs to be looked into, because people are getting the wrong information. He would like to see the definition corrected. Since no volunteers were forthcoming, John Fike will look into this and report at the May meeting. Mark P’s comment was that this issue has been raised to the Director but he is comfortable with how the data is recorded in the report. It is a useful comparison, so it has been left as is. One final comment was that most corporations’ annual reports reflect data collected over the previous year. Hence, a 2010 report would contain information from 2009.
With no other business to conduct, the meeting was adjourned at 12:00 p.m.
Carol Hammond, Secretary
|Todd LeBlanc||S Burlington||Chittenden|
|Galen E. Mudgett, Jr||Sharon||Windsor|