Allow me to regale you with a tale of government efficiency and wayward contracting.
I own several acres of land in King William County, Virginia. It’s a few acres of woods that my grandfather gave me when I was a child. There is nothing at all remarkable about the land.
I received a new reassessment of my land’s value some months ago. Despite not having any structures on this land (or even a road that leads to it), the company the county employed to reassess the land determined that said plot was wildly undervalued.
So undervalued, in fact, that they increased the tax assessment by 133 percent.
I should pause here to note that I have never had an issue with King William County, and all of my dealings with them have been courteous and ended in a satisfactory manner. I have always enjoyed dealing with their staff in the rare instances when I’ve had occasion to do so.
With that said, this massive change in assessed value presented a potential problem. In the past, I saw the incremental increases as good news—greater property value has an obvious upside. However, an increase of this magnitude would simply stick me with a huge hike in property taxes, and, at the same time, I would never be able to get such a price if I actually decided to sell the land.
For the first time ever, I contacted King William to appeal my assessment. The first step in that process is an informal appeal by phone (or Zoom). When my appointment came up, I told the county representative that my land is basically just a bunch of dirt in the woods with no running water, electricity, buildings, or other improvements. I pointed out that the assessed value they provided now far exceeds any offer I’ve ever received from property companies looking to buy up land.
This is noteworthy, because these property companies usually offer a decent price, as they seek to develop the land and reap a huge profit within a year or two. For example, if you have an undeveloped plot of land assessed at $10,000, they might offer you $12,500 for it, knowing that they’re going to put something on the land that will easily recoup their investment, or that will allow them to sell it for a massive profit down the line.
It’s pretty simple. People who aren’t doing anything with their land might be enticed for a quick payday, especially knowing in their heart of hearts that they’ll never use the land for any purpose other than accruing hypothetical value or serving as potential collateral in some other type of financial arrangement.
Anyway, back to the phone call. The rep explained that the reassessment of my land is part of a much larger, countywide effort to standardize and “equalize” assessed values across the county. That’s the purpose of the county’s new “Board of Equalization.” Furthermore, they’ve enlisted a company called Brightminds, LLC in order to implement this plan.
As I’m listening, what it sounds to me like is that the county simply wants to greatly expand its tax base, and the easiest way to do that is to raise assessed values dramatically—but to do so in a seemingly uniform way. That process will both (1) make it seem “more fair” from the proverbial 10,000-foot perspective, and (2) be more effective at raising revenue quickly, since it will apply to a huge percentage of landowners.
In the end, I state my case, hang up, and wait. The rep told me at the end of the call that I should get a written ruling on my appeal “by Christmas.” Finally, in early January, I received a new letter stating that my appeal had been denied, but that I could now make a formal appeal.
I contacted the county again to set up the formal appeal. As luck would have it, I was now also armed with a recent cold offer for the land from a development company. Notably, their offer price (which accurately reflects the market) was barely one-quarter of the would-be reassessed value.
I received information from the county about scheduling the appeal. However, some of the language in the instruction document implied I would have to appear in person. I speculated that this may not, in fact, be the case due to the pandemic, and that they may just be using an old form.
I wrote to confirm that an in-person appearance would be necessary. I was told that, yes, it would. This requirement was particularly frustrating because the informal appeal process had permitted phone or video conference options.
This clearly seemed to me to be an effort by the county to cut down on the huge number of people who were likely appealing massive increases (my uncle, who also owns land there and was appealing, was told about 700 landowners appealed). Because I live three hours away from King William, and also with underlying concerns about COVID in play, I basically said “I guess you all win.” I declined to schedule an in-person appeal.
That was about three weeks ago.
Yesterday, I received this e-mail:
The negative feedback on the process, and on the substance of the appeals themselves, was so overwhelming that King William decided to cut its losses. The county did so by bailing on both the ironically-named consultant outfit and on the Board of Equalization itself! Evidently, Brightminds, LLC also made numerous errors (no kidding!) and failed to meet several requirements of its contract with the county.
Bottom line: all of the assessments get thrown out, and we revert back to the previous values for another year. Months of work—gone!
While I sincerely applaud any entity that avoids the sunk-cost fallacy, the downside to this otherwise-hilarious situation is that, whatever the level of need to increase tax revenues was before, it has only grown in the wake of this fiasco.
The good news is that I might wind up as an on-paper millionaire before this thing is over!
Now, I won’t actually be able to sell the land for more than $20k, but let’s not get bogged down in minor details.