CordiYesterday, after much digging around, The Washington Post found that because the property-tax assessments on more than 500 commercial developments had been deflated by $2.6 billion, the District stood to lose $48 million in tax revenue. The investigation painted several D.C. finance and revenue officials, including chief appraiser Tony George, as perhaps too willing to accomodate D.C.’s biggest developers in cutting appraisals and, in turn, delivering smaller tax bills.
But in a response to the Post today, tax office chief Stephen Cordi says the $2.6 billion devaluation should not be considered shocking; in fact, this kind of sum is reported every year, and tax officials make adjustments to correct various mistakes made on initial assessments:
We stand by our real property assessment process, and, specifically, the assessments of the properties identified in this article. For instance, in the Gallery Place property, the assessor based his assessment on theoretical rent instead of actual rent that was being derived under existing rental contracts. This is the kind of error that supervisory assessors are required to identify and correct. Even after the correction of this error, the assessment on the property actually increased by 6.5 percent between tax year 2010 and tax year 2011.
Gallery Place, built by Herb Miller and John E. “Chip” Akridge III, had $58 million knocked off its taxable value when its 2011 assessment was reviewed.
And in previous years, the total adjustments on commercial property assessments have been nearly as high as or higher than the $2.6 billion knocked off in 2010. That sum was $2.8 billion in 2009 and $2.6 billion in 2008. Last year, when officials reduced property assessments by $1 billion, was the outlier.
Still, it has been easy for developers to work the system by hiring high-priced lawyers who can argue down tax assessments. That’s the main reason that the District’s tax appeals board was recently reconfigured.
Letter to the Editor From Stephen CordiPDF File_6
