Many commercial property owners suffered from sticker shock last year when the District changed its assessment methodology of office buildings and apartment buildings, basing assessments on pools rather than individual building data such as vacancy and rental rates. Many tax property owners have yet to experience any relief, as the 2016 assessment notices issued earlier this month were still based on financial information that is more than a year old and likely does not reflect the true value for office buildings and their current vacancy rates. This is largely due to the fact that property owners are not required to submit income and expense data for their buildings until April 15, meaning assessors are working off 2013 income and expense information.
Relief could finally be in sight, according to the Washington Business Journal, as the District is still working on ways to improve the system, chiefly its accuracy and predictability, but did not have enough time following last year's appraisals and the sticker shock many felt as a result to implement more changes this year. Among the potential changes, D.C. Chief Financial Officer Jeffrey DeWitt says it is a timing adjustment that would let property owners submit financial data for buildings before the assessors have to put notices in the mail. The challenge with that, however, is that by law the District must send out its assessment notices by March 1. Making property owners submit their income and expense data before those assessments come out would only give them January and February to complete the work instead of until April 15 now. That change, however, would require approval from the D.C. City Council — and may not be universally embraced by all property owners, as having more current information will likely result in higher assessments — and taxes — for some but not others.
For the full article from the Washington Business Journal, click here.