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‘Blindsided’ Norwalk officials scramble to assuage 260 rebuffed taxpayers

From left, Norwalk Board of Estimate and Taxation Chairman Ed Camacho and Mayor Harry Rilling on Wednesday question Tax Assessor Michael Stewart in City Hall.

Carl Cooke’s not feeling euphoric about the valuation placed on his Utopia. (Google)

Updated, 9:14 a.m.: Comments from Adam Blank.  8:21 a.m.: Copy edits, revised headline

NORWALK, Conn. – Two hundred sixty commercial property owners have been denied a hearing on their assessment appeals, because the city body that hears appeals doesn’t have the necessary experience.  City officials are scrambling to find a solution that doesn’t require costly litigation for each case.

Property owner Carl Cooke’s request for an appeal was turned down by the Norwalk Board of Assessment Appeals, and he finds the situation “insane”.

“As the owner of about two dozen properties in Norwalk, paying over, $175k in yearly taxes, I find it incredible that I have to take the city to court to argue some relief on what I believe to be an over valuation of my property,” he wrote.

Cooke said he knows roughly half a dozen property owners who are similarly outraged, and that may be just the tip of the iceberg: City officials say 260 Norwalk commercial property owners, whose properties are assessed at more than $1 million, have been denied a hearing on the results of the 2018 revaluation, an outcome permitted by state statute.

Mayor Harry Rilling on Wednesday evening said he was blindsided by the outcry on decisions he knew nothing about, and ordered Tax Assessor Michael Stewart to send out a second set of letters to the aggrieved property owners, informing them that although the BAA won’t hear their complaints, the City will go through an “informal process” to resolve the situation without great expense.

Meaning, they can file a lawsuit, and the City will go through pre-trial conferences in an effort to informally settle the issues “under the auspices of the court,” Board of Estimate and Taxation Chairman Ed Camacho said.

Cooke owns Utopia at 150 Connecticut Ave.; the property’s appraisal has leaped from $1,291,230 under the previous revaluation to $1,844,620 under the new one.

“I am working on an appraisal that will come in at about $1.2M, a third less, than the city has valued it at. Given the current mill rate that would increase the taxes on that one property by over 50%,” Cook wrote. “So, to dispute my assessment, I need to hire an appraiser for thousands of dollars, hire an attorney for what I figure to be at least ten thousand more and sue the city because they are not capable of getting competent people to hear these appeals.”

“It’s another shortsighted thing that the city does which makes me want to move out of this town. It’s discouraging,” Cooke said to NoN, estimating that a lawsuit will cost him $15,000 ­– if it doesn’t go to trial – and that he’s thinking about the relative costs, the taxes he might save versus the money he’ll spend in court.

Connecticut State General Statute 12-111 states, “The Board may elect not to conduct an appeal hearing for any commercial, industrial, utility or apartment property with an assessed value of greater than one million dollars,” the letter he received from the Board of Assessment Appeals stated.

“Norwalk’s BAA members are appointed by the Mayor, and the current members are primarily residential realtors,” Stewart wrote to Greater Norwalk Chamber of Commerce President Brian Griffin on Thursday. “In recent years these residential realtor’s lack of commercial valuation expertise has diminished their willingness to conduct appeal hearings with commercial owners or their agents. The BAA has exercised its prerogative to not conduct certain hearings as is permitted by state law. More BAA members with commercial property backgrounds would go a long way toward eliminating this issue.”

“Understanding that our volunteers on the BAA do not have the requisite knowledge to assess multimillion dollar properties, the only resolution would be to attempt to recruit commercial property Assessors to serve. As most are extremely busy during a reval year, that could be quite difficult,” Rilling wrote Wednesday to NancyOnNorwalk.

The Board of Estimate and Taxation during a Wednesday evening meeting queried Stewart about the issue.

The BAA has never before exercised that state statute on appeals due to a revaluation, Stewart said, explaining that in 2008 there were fewer appeals and the Board was very different, with a “very experienced, very strong chair that wanted to hear” the commercial appeals.

“I was more in a position to encourage them to do it,” he said, characterizing the current Board as uncomfortable with sitting with commercial property owners and their agents.

Rilling said he “gets it,” most of the BAA members “have residential real estate knowledge, and they feel, if you will, intimidated” by facing attorneys and appraisers working for a commercial property owner.

“If I had known that, we could have tried to recruit some people with commercial real estate experience that could hear (these appeals), even if we had two people that could hear these appeals only, that would be another benefit,” Rilling said. “But the letters went out, I had no knowledge they were going out and I get blindsided.”

Rilling asked if it’s common for Connecticut BAAs to refuse the appeal requests.

“I don’t know that it’s common practice, but I know that it’s done,” Stewart said.

Stewart resisted the suggestion that new letters be sent out to inform the 260 property owners that they won’t face a court battle.

“We will do it, but that wasn’t the requirement under the statute, but if that’s what you want done,” he said.

“I am requiring that,” Rilling said. “We are dealing with people here. We are dealing with commercial property owners that have to make a living like everyone else, and to give them less than total information as to their options is not acceptable. We have to let them know… If you want to talk to us, file with the court. Then request to come into the assessor’s office and we’ll see if we can come to an agreement.”

Stewart said he wasn’t sure what the fee is to file a lawsuit.

Camacho, an attorney, said that plaintiffs through the discovery process would have access to the City’s appraisal and wouldn’t necessarily have to hire an appraiser or even an attorney, “because before that, you would tell the court that you are willing to have a pre-trial conferences, either here in City Hall or somewhere else, to try to resolve these matters informally, albeit under the auspices of Superior Court.”

There could be a stipulated agreement, and it “doesn’t mean full-blown litigation,” Camacho said. “There is still the possibility to sit down with the city to resolve the appraisal… these are considerations that the City, that the tax assessors’ office is providing to see if we can work these things out cooperatively.”

Former Zoning Commission Chair Adam Blank, a supporter of Rilling and a real estate attorney who specializes in assessment appeals, wrote in a NancyOnNorwalk comment Thursday morning that taxpayers would still face substantial costs despite the informal meetings.  “…Even if the Mayor forces the Assessor to give taxpayers an informal meeting the end result will be that the Assessor will decide he doesn’t have enough information to justify a reduction and a formal appeal will be necessary. There also is the problem that the Assessor is not legally permitted to change an assessment once the BAA denial is sent out; any change now has to come through a court filing and court approved stipulation. These appeals aren’t cheap, typically $10k to $15k in attorneys fees, $5k to $10k for an appraisal report, $750 for court filing/service fees, and that’s all if the case settles at the first settlement conference in New Britain,” Blank wrote.

Blank was also critical of Norwalk’s practice regarding appeals.  “Despite (the Mayor’s) best intentions he does not control the handling or settlement of tax appeals. That lies solely within the Assessor’s statutory authority. Norwalk is the most litigious municipality in the state when it comes to tax appeals. Norwalk does not do informal settlement conferences. Many other municipalities do so. Norwalk will not settle any of these without forcing the case to New Britain. Norwalk will require formal, tedious discovery from each and every taxpayer before they will even schedule a settlement conference,” Blank wrote.

Cooke said he understands appraisals are “not a perfect science” and while he’s confident one of his residential properties is over valued – he sold the house next door for $600,000 and the City says the one he still owns is worth $880,000 – some of his residential property might be undervalued.

“I get the city, they are shifting some of the tax burden on those they think can afford it,” he said. “It’s just not fair.”

Then-Chief Financial Officer Bob Barron told Common Council members in January that residential appraisals have gone up 20 percent but commercial appraisals have gone up at least 40 percent.

That’s the opposite of what happened in the 2013 revaluation, following the economic crash, because, “The crash hurt businesses a lot more than it hurt residential values,” Barron said.

Real estate makes up 75 percent of the grand list, and of the real estate portion, 15 percent is commercial, he said.  With the shift, he expected that maybe commercial would become 17 percent of the grand list.

“The commercial share, they are taking a bigger share of the cost (to run the city) then they would have,” he said. “Their values went up essentially at twice the rate of residential. We are really pleased to see that. Anything that’s going to provide some tax relief to the residential homeowners is good news.”

27 comments

Adam Blank March 14, 2019 at 7:44 am

Half my practice is handling property tax appeals. I represent municipalities defending the assessment and I represent taxpayers challenging assessments – including many in Norwalk. I like Mayor Rilling and support him. However, despite his best intentions he does not control the handling or settlement of tax appeals. That lies solely within the Assessor’s statutory authority. Norwalk is the most litigious municipality in the state when it comes to tax appeals. Norwalk does not do informal settlement conferences. Many other municipalities do so. Norwalk will not settle any of these without forcing the case to New Britain. Norwalk will require formal, tedious discovery from each and every taxpayer before they will even schedule a settlement conference. These are the Assessor’s policies and even if the Mayor forces the Assessor to give taxpayers an informal meeting the end result will be that the Assessor will decide he doesn’t have enough information to justify a reduction and a formal appeal will be necessary. There also is the problem that the Assessor is not legally permitted to change an assessment once the BAA denial is sent out; any change now has to come through a court filing and court approved stipulation. These appeals aren’t cheap, typically $10k to $15k in attorneys fees, $5k to $10k for an appraisal report, $750 for court filing/service fees, and that’s all if the case settles at the first settlement conference in New Britain.

Mike Barbis March 14, 2019 at 8:11 am

Adam,
There are two more facts worth mentioning …. (!) Norwalk’s Assessor asks for continuance after continuance … costing the property owner time and money. One case in Wilson Point went on for 8 years!! (2) As I understand it, the City loses almost EVERY case in New Britain … as Norwalk’s Assessor repeatedly fails to have a convincing case.

Paul March 14, 2019 at 8:12 am

Thanks Adam your comments are very informative and confirm my suspicions that the informal hearings would be fruitless.

Claude March 14, 2019 at 8:44 am

Thank you Adam- I got more information in one paragraph from you here than the Assessors office has offered in 12 years. Bottom line: whatever the tax increase is you are paying it as it makes no sense to fight it financially. It’s a dog and pony show.

Jason Milligan March 14, 2019 at 8:45 am

I will say that Tyler Technologies did a nice job at the informal hearings they held. They were knowledgeable and reasonable in the meetings we had.

I am satisfied, not thrilled, with the end result for all but 1 property.

The 1 property they have wrong by $2 million. That one will be appealed, and we will win.

Lisa Brinton March 14, 2019 at 8:46 am

It appears City Hall wants it both ways – 16% growth in the overall grand list… and then, ‘volunteers on the BAA [that] do not have the requisite knowledge to assess multimillion dollar properties…’ Which is it?

Perhaps the administration might seek the advice of commercial appraiser, Mike McGuire. Oh, that’s right, they’re busy telling him his area is blighted and ripe for eminent domain and tax credits, per the latest EZ Pass styled Redevelopment Plan.

At Tuesday’s Council Meeting, I reiterated that City Hall lacks commercial expertise, resulting in taxpayers being short changed in the big land use decisions (Poko, 95/7.) I’ve also seen many of the numbers on the 2018 ‘meat and potatoes’ commercial assessments – it’s all publicly online. Hundreds of those were out of step, like the residential assessments, only by larger percentages and absolute numbers.

I take issue with use of the word ‘blind-sided.’ Many of us have had conversations with this mayor since taking office over Norwalk’s biggest Achilles heel, lack of real estate knowledge. Last year, Finance Director Bob Barron provided details on why the grand list had stagnated – $30M worth of appeals and that was in Year 5 of the 2013 assessment! So, yes it does take awhile for those appealing to move through the ‘system.’

EnoPride March 14, 2019 at 8:56 am

“If I had known that, we could have tried to recruit some people with commercial real estate experience that could hear (these appeals), even if we had two people that could hear these appeals only, that would be another benefit,” Rilling said. “But the letters went out, I had no knowledge they were going out and I get blindsided.”

Mayor Rilling, “If ifs and ands were pots and pans, there’d be no work for tinkers’ hands.”

Once upon a time, in 2008, there was “a very experienced, very strong chair that wanted to hear the commercial appeals”. But in today’s Norwalk, we have BAA members appointed by Mayor Rilling who are unqualified to fulfill their job responsibilities, and who will not hear the business owners’ appeals because they are too intimidated? And the Mayor is blindsided? He knew little about the qualifications of his appointees or of these goings on? Surely he gets briefed as the Mayor, no? And these business owners are going to have to be further financially inconvenienced on top of the large, inexplicable property tax increase they were hit with, by having to spend their own money to sue in order to be heard?

Norwalk deserves leadership, not more excuses and nonchalant, “Shoulda, coulda, woulda”, where squandering of taxpayers’ money is concerned. Vote for change this next election, Norwalk!

Piberman March 14, 2019 at 9:33 am

Is the problem that Norwalk needs a City Hall professionally capable management team fully qualified to oversee a $345 million budget. But elects one that wouldn’t be qualified to run a small Wal Mart or Rite Aid ? But pays the $150/$160k salaries for “Chiefs” nonetheless.

Sue Haynie March 14, 2019 at 10:56 am

I’m sorry, but Mayor Rilling has a highly paid Assistant Mayor too….so Norwalk taxpayers pay $300,000/ year in Mayoral salaries (not incl. pension & benefits) and both of Norwalks mayors are ‘blindsided’ by an appraisal process they’ve known about for at least 4 years. How many Mayors will it take (cost) to avoid being ‘blindsided’ on something so consequential to taxpayers?

JP. Joe March 14, 2019 at 11:31 am

Thank you Adam for making this issue very clear after all
facts do matter. Good to see there is a credible adult in the room.

Scott March 14, 2019 at 12:00 pm

Nice job breaking it down for us Adam!

“Rilling said he “gets it,” most of the BAA members “have residential real estate knowledge, and they feel, if you will, intimidated” by facing attorneys and appraisers working for a commercial property owner.”

Now they know what the residential TAX PAYER feels when s/he has to dispute an assessment.

I feel terrible for all 260 commercial owners…..good luck!

Joanna Cooper March 14, 2019 at 12:21 pm

How can Riling claim he is blindsided when his attorney’s expertise is real estate matters, he has a second mayor (Chief of Staff), he appointed the tax guy who is making the decisions— it’s the most critical issue affecting the city and the one he’s focused on as he says he grown the grand list by 16% ?

Jake March 14, 2019 at 12:47 pm

Lots of anger and accusations with little factual basis, as usual.

The fact of the matter is, the only power that is granted to any Mayor of Norwalk relative to the tax assesor is the power to hire one or fire one. There in no person, board, commission, council or any other individuL or entity that can walk in and tell the assesor what to do relative to valuations, appeals, etc. That is the way governance in Norwalk is set up. If you do not like it then talk about changing
the structure instead of talking blame and deflection.

The tax assesor is supposed to be the “professional” that oversees all these issues without influence from any outside parties. Call for the assessors head if you think there are problems. Lay out your claims and then the Mayor can do something. But in Norwalk the Mayor doesn’t have the power to be the assessor.

Mike Mushak March 14, 2019 at 1:35 pm

For the record, the Tax Assessor was a Republican-approved appointee under Mayor Moccia.
.

Claire Schoen March 14, 2019 at 2:45 pm

This exclusive story is a perfect example of why we need NancyOnNorwalk’s coverage and ‘digital town square.’ Between the story itself, and the informed comments that follow, we’re all better aware of what’s going on.

Thank you to all our loyal readers who have supported our efforts — and if you haven’t yet become a sustaining member, please consider making a visit to the donation box on the homepage… 🙂

Lisa Brinton March 14, 2019 at 3:49 pm

Mike, As I’m sure you are aware, per the city charter, the mayor appoints or reappoints the Tax Assessor every four years. And, as Mr. Stewart wrote to the Greater Norwalk Chamber of Commerce, members of the Board of Assessment and Appeals (BAA) are also appointed by the mayor. The quality management issues we are facing with regard to the 2018 revaluation sit squarely with the executive branch and this mayor; but nice try 🙂

Lenny Godber March 14, 2019 at 5:46 pm

The assessor is acting within the laws of the Connecticut General Statutes, The Baa is allowed to waive the right to hear Commercial properties with an assessment over 1 million dollars they are all very experienced realtors with expertise in Norwalk they act independently from the assessors office, the decision to waive hearings for commercial properties was theirs alone Mr. Stewart has nothing to do with this as he is at arms length from them.

Non partisan March 14, 2019 at 10:09 pm

I have a better question- why did so many previous members of the BAA resign?

Why was Tyler told to ignore all the hard work of the prior BAA and use algorithm that over inflates property values

Why were previous appeals and court cases ignored so propertykowners now need to waste time proving the same cases over again?

Why is the city administration pushing a platform that property values have risen- when- if you compare recent sales or properties on the market- to proposed assessments you find that the properties are over assessed from 10 to 100%. This is especially so for the higher end neighborhoods.

Dominick Pastorello March 14, 2019 at 10:42 pm

First let me say that the BAA are all volunteers who i believe are trying there very best to do the right thing for home owners, they are truly unbiased in my experience will evaluate all information furnished to them, when it comes to commercial building it is unfair for both the building owner and BAA member to review information they quite honestly not qualified to review, the statue has always indicated that the properties over 1 million dollars be brought up to Superior court, the real problem lies in the revaluation itself and quite frankly should have be redone, the repercussions of this revaluations will be felt for several years, but by all means the people on the BAA are not the problem they are trying to be the solution by interviewing and reviewing countless files and correcting the many inaccuracies in the revaluation

Jake March 14, 2019 at 10:46 pm

Non Partisan-

Your points are well taken and the Tyler “computer data input” method is the largest fraudulent, inaccurate and hands off approach possible. That is why I recommended in my earlier post that people document their claims so that action can be taken. The assesor position is a union job. Without well documented failures/egregious mistakes it is virtually impossible to dismiss a union employee. The City (and the Mayor) understand this and also understand that an attempt to remove a union backed employee will result in hundreds of thousand of dollars in legal expenditures. So if the non partisan opinion is that the assesor is incompetent then lets provide the factual evidence to get him removed without a lengthy and expensive legal fight. I am sure there is an equally passionate position regardless of political views. This assesor is the butt of jokes across the state within the professional valuation community. Unfortunately he is protected by a union contract.

Non partisan March 15, 2019 at 11:48 am

@ Jake- it’s not just the assessor.

The assessor has no supervisor and works independent of any oversight.

The assessor reported to Barron. Hamilton now indicates his function is solely to get the budget out. So now the assessor reports to no one directly.

At the end of the day the mayor is responsible. The Tyler algorithms are faulted and exaggerate values on residential properties over 1mm And many commercial properties.

Tyler personal were told not to use prior court cases or prior baa reviews. They also were told not to talk to BAA members to get their institutional knowledge. This was intentional, in a money grab scheme. So every property that does not fit into the algo is improperly assessed.

This is creating very bad vibes amungst a growing portion of the residential property owners.

And Btw- the assessor loves to take cases to court- he get a day off to drive to new London.

Piberman March 15, 2019 at 2:10 pm

Greenwich with a Prof. Manager doesn’t have these assessment problems. Nor reportedly do our surrounding towns.

So why does Norwalk have these ongoing problems ? Is anyone ultimately “responsible” ?

And will the issues ever “get resolved” ?

We know the answers already. And we know why major business gives Norwalk a wide berth.
And we know why those of us with major business experience avoid “public service” in Norwalk.

Uriah Heep March 17, 2019 at 11:28 am

The Board of Appeals has exercised the right to waive COMMERCIAL properties with an assessment of over 1 million dollars since 2016….can anyone explain why anyone is supposedly blindsided or scrambling at this point after 3 years? I understand this was mainly done due to the huge volume of appeals rather than the inability to comprehend the complexities of commercial appraisal

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