Some property taxes to increase for homes

That almost half of the county’s homeowners face rising property taxes after losing as much as 50 percent of their homes’ market value during the downturn would seem to be good news for those concerned about their finances.

But the experts say it’s a bit early to celebrate the long-awaited economic rebound, a return to Las Vegas’ boom years.

Higher assessed values and the higher taxes they are bringing to many people do not reflect a market rebound, they say.

In many cases, county appraisers assessed those properties too low last year when the market was in a free-fall, and they now must make corrections.

"The assessments might’ve been too conservative in some areas," said Rocky Steele, assistant assessor. "It’s been very difficult for us to (assess) value in this market."

One analyst likened the task to measuring a snowpack during an avalanche. With home prices going into such a steep slide last year, it would be easy to undervalue some of them, said Jeremy Aguero, a principal with Applied Analysis.

Aguero warned against using assessed values as a gauge for a recovery.

"The linkage between market values and assessed values is pretty loose," he said. "Looking at just one statistic like that is a pretty dangerous game."

Still, home values seem to be flattening. Overall, they’re on track to lose just 1.25 percent of their taxable value in the next budget year, Steele said, adding that "there was some stabilization."

Aguero noted that home prices have stayed fairly constant the past 12 to 18 months. In contrast, business site prices depreciated sharply. Commercial parcels dipped by 28 percent; industrial sites fell by 22 percent, and vacant land lost half of its taxable value.

The business segment accounts for most of the projected $130 million loss in property tax revenue, which is spread across 40 entities, including the county, cities, libraries and fire districts.

Officials expect to lose more revenue when the county resolves disputes with thousands of property owners appealing assessed values. So far, the volume of appeals is on pace to match last year’s record 8,300, Steele said.

On a somewhat brighter note, the revenue dip is well below the $320 million drop that was happening a year ago.

"It does look like it’s not in free-fall," county Treasurer Laura Fitzpatrick said. "It’s still a fragile economy."

County government will take a $28 million hit to its general operating fund, compared to last year’s $44 million.

But slower bleeding is still painful.

"It’s still not good news considering what we’re facing," county spokesman Erik Pappa said. "We’re going to see a further drop at a time when we’re less equipped to cope with it."

Last year, the county tapped reserves to plug budget holes, and this year that money won’t be there, Pappa said.

Local governments are feeling the effect of extremely high vacancy rates for business properties, Aguero said.

Office space is at 25 percent vacancy; industrial is at 16 percent, and retail hovers at 10 percent, he said, adding that high unemployment is at the heart of the problem.

"Our economy appears stuck in reverse as far as the commercial market," Aguero said. "Before this turns around, we’ve got to create more jobs."

Contact reporter Scott Wyland at swyland@review journal.com or 702-455-4519.