At the start of the June 17 Cook County Board of Appeals and Equalization meeting, County Assessor Betty Schultz explained that the hearing was an opportunity for taxpayers to appeal their 2015 property value and/or classification.
Schultz, assisted by Assistant Assessor Alison Plummer, and the county board reviewed a report on county estimated market valuation changes, property sales, new construction values for 2015 and a summary of work performed by the assessor’s office in 2015.
Land gift equals higher taxes
Molly Hoffman of Grand Marais appeared with a vexing situation for all involved. Molly and her husband Ken live in a small house without electricity or running water with no road into the property. They walk about 1/3 mile to get to their home, said Hoffman. Because they are getting older, Hoffman said they didn’t know how long they would be able to live in their house, but they worried that if they sold their land their nearby neighbor might be exposed to development. To shield the neighbor, they gave her about 20 acres on a simple deed. “She didn’t ask us, and we didn’t want to be paid. We were trying to help her,” said Hoffman.
Imagine the Hoffman’s shock then when their taxes greatly increased.
“We reduced our acreage to under 40 acres and our taxes are much, much higher,” Hoffman said.
Plummer explained that smaller parcels are valued at a higher rate. “That’s been explained to us,” said Hoffman, “but it’s still not clear to us.”
The Hoffmans’ valuation went from $114,300 on 47.77 acres to $185,600 on 30 acres.
Plummer said that because there wasn’t road access into the property that she and Schultz could take that into consideration. Commissioner Frank Moe asked if wetlands on the property might lower the valuation and Plummer said yes, if there were any. Moe said he would ask David Demmer with Planning and Zoning to make an assessment of the wetlands.
The board suspended the meeting until the assessor’s office could refigure Hoffmans’ assessment. They are scheduled to reconvene on June 23 but Assessor Schultz was unavailable for that meeting, so the board of equalization will be reopened on Friday, June 26.
Values changed because of real estate market
Dennis Rysdahl of Tofte brought three properties for review. Rysdahl said that three back lots at Temperance Landing in Schroeder were presently unsellable in today’s market. One lot has a shell cabin on it, but has no electricity or running water. He asked for a reduction in taxes on all three lots, and after some discussion the board reduced the value by $37,500 on each lot.
The valuation of the unfinished cabin remained $133,300.
Next Rysdahl presented an argument to reduce the six back lots at Surfside in Tofte, which were assessed at $57,500. Because these lots are virtually unsellable in today’s market, Rysdahl said there has been talk of giving them to the Surfside Association, which would take them off the market. After some discussion the board reduced each lot by $2,000.
In 2005, Unit 54 at Bluefin Bay was turned into a meeting room for the Bluefin Bay Owner’s Association. Unfortunately the change was never recorded. When Plummer and Schultz discovered this, they assigned the unit to its pre-2005 designation. “We can’t go against state statutes,” Plummer said.
The board agreed with Schultz and Rysdahl said he would re-file the paperwork noting that Unit 54 wasn’t a rental property, but instead a meeting room. The taxes would again be lowered to reflect that corrected paperwork.
Big increase for Bear Track Outfitters
David and Cathi Williams came before the board and asked why, after 43 years, their business, Bear Track Outfitters in Grand Marais, had been reclassified from resort seasonal recreation to commercial, and they requested reconsideration of the valuation and classification. David Williams said their taxes had gone up $2,062 over last year, adding, “That’s a lot for a small business to absorb.”
Schultz said based on the state guidelines, Bear Track didn’t meet the qualifications for seasonal recreational because their Bally Creek rental cabins were five miles from their business and the cabins had to be within two miles of the business. To meet the criteria to be a “4C, resort seasonal recreational” property, it must contain three or more rental units, noted Schultz. Plummer told the Williamses that if they put three pads for tents in back of their building and rented them to guests they would qualify for the resort seasonal recreational designation.
The recommendation of the assessor’s office was to classify the parcel as commercial and the board agreed, but Commissioner Garry Gamble asked Schultz and Plummer to work with people to attain the best classification they could get when they came in with questions.
Hovland property considered unbuildable
Tim White came before the board and asked why his taxes had gone up from $166 to $518. White owns property on County Road 14 in Colvill, some of which is on the Brule River. However, he said, much of the land is in a flood plain, so it can’t be built on.
Plummer said that she and Schultz used aerial maps to determine that there was some buildable property on White’s land on the river.
Commissioner Moe said he and David Demmer of Planning and Zoning had spent two days trying to get to the spot deemed buildable and they found it was steep and not big enough to put up a cabin.
Schultz said the higher valuation placed on the river frontage owned by White was justified because of recent sales along the river. “They are still paying big money for the land along the river. It’s either the view or the Brule River that’s driving those prices,” said Schultz, adding that it was their duty as assessors to use sales in determining land values.
After some discussion the board agreed with Moe, and White will be given his 2013 assessment.
Farm size affects value
Mark Adams of Hovland came before the board and asked that he be allowed to keep his agricultural designation. Adams said he has worked the farm for 40 years, raising and selling vegetables, livestock, pigs, horses, boarding horse and renting draft horses that are used for logging, as well as running a small sawmill on the property.
Plummer argued that Adams has only about two acres of tillable land, and the state calls for 10 acres or more of tillable land on a property to be classified as a farm.
Commissioner Moe asked Adams if he made a living from his farm and Adams said yes. Moe said that he and his wife had grown up on farms and he told Plummer that in his view, despite not meeting the state’s guidelines, Adams most certainly lived on a working farm.
The board agreed and granted Adams his agricultural designation.
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