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David B. Wissel, Assessor
Certified General Appraiser #CG01315752
"Fair, Uniform, & Equitable Appraisals, Within the Law"

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House Bill 2011 - 1146   |   Final Report Land Assessment and Classification Task Force

May 1, 2012

We have fielded many questions regarding the implementation of recent legislation enacted by the Colorado General Assembly in their 2011 session.

House Bill 2011 – 1146 adds additional language for the classification of residences, on a tract of land up to two (2) acres in size, depending upon the use of the residential structures located on the Ag - classified parcel. It requires the Assessor to determine if the individual(s) who live in the residences actually and substantially contribute to the Agri-business activities.

Does the individual primary residence meet the bills definition of “integral involvement to the Ag operation”? Are the tenants of additional Residential structures “integral”, or are they “substantially” involved with the agricultural operation? This new sub – tract of land will be valued using the Market approach to value, with the Residential assessment rate applied accordingly. This is an administrative action, with no formal “split” of the “new” tract.

The real property, to which this will apply, has already been qualified and classified as an Agricultural parcel. We classify property based upon the use of the property, by law. This new language adds a section about the people who live in these residential structures, located on Ag lands. As well, it also asks very private questions of the property owner, and about their tenants / occupants too. What is their direct, “integral” involvement with the farm or ranch operation?

Under the terms of this bill we have to now value the farm and ranch operation in total, within existing law. After deciding who qualifies and who doesn’t, cut out up to two (2) acres (at the discretion of the individual Assessor), to be appraised and classified as Residential. All of the out buildings, sheds and barns now classified and appraised as Ag, would then become Residential structures, if located on that “new” tract. And, they would be assessed at the 7.96% rate of assessment, rather than Ag at 29%.

In my entire 33-year history with the Park County Assessor’s Office, we have never appraised or valued people before this law! That is exactly what this bill requires me to do. How are we going to appraise the activities of people? We have historically appraised real and personal property, based upon the use of the property.

I have a strong philosophical objection to this bill. It doesn’t treat all of the folks fairly. For example, if you are a relative of an active bona fide ranch or farm owner, your house remains classified and appraised as Ag, regardless of your activity level with the Ag business operation. If a family member or sibling lives on the farm or ranch, even with no contribution to the Ag operation, the classification remains as Ag.

We have always appraised ANY residential structure like any other residential structure, whether located on a farm or ranch, or in town, or within a subdivision. There is no difference in our appraisal of the improvements.

I agreed to allow a questionnaire, developed by a neighbor Assessor, to be mailed to a selected group of current Ag landowners, with an existing Ag residence located on the land. These all were current Ag - classified properties where we didn’t know who was occupying the house(s). Are the individual residential structures vacant or occupied, and by whom? And, what do the residents contribute to the Ag operations?

It was sent to approximately 400 property owners. We have a total Ag property count of approximately 1,800 accounts listed on the current tax rolls.

The questions asked of these citizens were nothing less than prying into your personal affairs! In hindsight, I should have never mailed the survey. I apologize to each person or family who was sent this request for very private and personal information. Please note; all of the Ag use documents (evidence of Ag use), and other related information supplied to us by taxpayers is considered confidential, and not available to the public.

I have reviewed each and every single document returned to this Office, regarding the status / use of the residents, in Ag residential structures.

I appreciate the folks who did try to help us in our task to delineate the different uses on their residential structures. However, the bottom line is this: we don’t know enough empirical information to make that distinction in a fair and equitable method. I won’t penalize the folks who were trying to do the right thing, who may have provided an unclear or confused answer.

It is my professional opinion that we (the Assessor and his staff) have no factual basis in determining who is doing what type of living / working activities on these “unique” properties. Frankly, I don’t want to know, as it is none of my duties to know your private business arrangements! I don’t believe any level of government needs that type of data.

Proponents of this law want to generate MORE property tax revenue from this application. Supporters of this new concept want to have those “rich” Ag people, “to finally pay their fair share”, as they are “getting away with something”… I don’t believe that is the case.

These requirements can be viewed as a “beggar my neighbor” approach… “Don’t tax you, don’t tax me, tax that other fellow behind the tree” comes to my mind. That just isn’t good public policy, in my professional opinion.

This whole process was designed to address the proponents main stated purpose; to provide another “tool” for individual Assessor’s to utilize a new legal avenue, if they choose to. It ultimately is a matter of equalization within their individual county communities. They answer directly to their constituents, as I do.

There is NO constitutional relationship to this legislation, as some have stated. To be sure, someone in this state will challenge the validity and constitutionality of this law. Ultimately, I believe this law will be found by the courts to be outside valid constitutional grounds.

This bill does nothing to further improve or enhance greater equity in the Colorado property tax system, it only complicates the issue further.

Taking all of these factors into consideration, I have made the decision to not move forward with the implementation of HB 11-1146 at this time. It is my professional opinion that this law is SO vague and ambiguous; it provides no framework in order to arrive at valid conclusions based upon facts, which are unknown at this time.

I will monitor the situation, as time will offer clarity to the effects of the bill across the state. I believe my direct involvement in the issue, and my years of experience will benefit our property owners in the long term.

I hope this will help clarify my position, and explain the circumstances and the environment why I have arrived at my position.

If you have further questions or comments, please contact me at your convenience.

House Bill 2011 - 1146   |   Final Report Land Assessment and Classification Task Force

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