What needs to happen?
Any tax system needs to be objective, consistent and easily auditable.
Control needs to be in place to prevent errors such as $20 million lost valuations
Below is one method to meet these objectives – Additional systematic methods can be
developed after further study to knock down "judgement" straw men.
1. Independent audit of ADOR and county BOE
2. Stay with current formula Land = Sales price – Improvements
and Improvements = Replacement cost new less Depreciation
3. Alabama Appraisers Manual (AAM) is good for determining replacement cost
. However would it be less expensive to use existing commercial manuals?
4. AAM needs a better definition of class and scale
5. Depreciation based on age unless supported by pictures and cost estimates and not
. based on undocumented “judgment”.
6. Land – Create uniform State wide Land valuation rules as has been done in AAM for
replacement costs.
A. Parcels that Sell in tax year (4%) used to determine neighborhood land value.
1. Inside appraisal of improvements because these will be used to create
. neighborhood land values and must be as accurate as possible. Homes that are
. on the market are open for inspection.
2. Last sales influence factor created for each parcel making tax value equal to sales
. price. This factor as a percent of land value will stay with parcel until next sale
. replacing all other influence factors. In addition this will give homeowners
. incentive to correct any purchase price error, thus reducing distortion in
. computing neighborhood land rates.
B. Parcels that do not sell in tax year (96%) project land value based on 6a above
1. Neighborhoods
. Consist of at least 500 parcels to insure sales every year and prevent
. gerrymandering
. Same school district
2. Standard method determining land value - ff,acre,sq,lot
7. Each BOE to submit same standard reports to ADOR
8. ADOR to perform audits to insure compliance with above rules/procedures
9. ADOR to make valuation procedures easy for taxpayers to understand via internet
10. ADOR to develop whistle blower / crime stopper policy to allow taxpayers to
. come forward without fear of reprisals
Any tax system needs to be objective, consistent and easily auditable.
Control needs to be in place to prevent errors such as $20 million lost valuations
Below is one method to meet these objectives – Additional systematic methods can be
developed after further study to knock down "judgement" straw men.
1. Independent audit of ADOR and county BOE
2. Stay with current formula Land = Sales price – Improvements
and Improvements = Replacement cost new less Depreciation
3. Alabama Appraisers Manual (AAM) is good for determining replacement cost
. However would it be less expensive to use existing commercial manuals?
4. AAM needs a better definition of class and scale
5. Depreciation based on age unless supported by pictures and cost estimates and not
. based on undocumented “judgment”.
6. Land – Create uniform State wide Land valuation rules as has been done in AAM for
replacement costs.
A. Parcels that Sell in tax year (4%) used to determine neighborhood land value.
1. Inside appraisal of improvements because these will be used to create
. neighborhood land values and must be as accurate as possible. Homes that are
. on the market are open for inspection.
2. Last sales influence factor created for each parcel making tax value equal to sales
. price. This factor as a percent of land value will stay with parcel until next sale
. replacing all other influence factors. In addition this will give homeowners
. incentive to correct any purchase price error, thus reducing distortion in
. computing neighborhood land rates.
B. Parcels that do not sell in tax year (96%) project land value based on 6a above
1. Neighborhoods
. Consist of at least 500 parcels to insure sales every year and prevent
. gerrymandering
. Same school district
2. Standard method determining land value - ff,acre,sq,lot
7. Each BOE to submit same standard reports to ADOR
8. ADOR to perform audits to insure compliance with above rules/procedures
9. ADOR to make valuation procedures easy for taxpayers to understand via internet
10. ADOR to develop whistle blower / crime stopper policy to allow taxpayers to
. come forward without fear of reprisals
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Alabama Property Tax Information
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