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ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: May 7, 2013 <br />Action Agenda <br />Item No. 7 -b <br />SUBJECT: Information and Resolution Regarding the Next Revaluation of Real Property <br />DEPARTMENT: Tax Administration PUBLIC HEARING: (Y /N) No <br />ATTACHMENT(S): <br />1) May 15, 2012 Board - Approved <br />Resolution <br />2) Draft May 7, 2013 Resolution <br />Establishing the Year of the Next <br />General Reappraisal <br />3) April 10, 2013 Memo from Tax <br />Administrator - 2015 Property Tax <br />Revaluation <br />INFORMATION CONTACT: <br />Dwane Brinson, Tax Administrator, <br />(919) 245 -2726 <br />1 <br />PURPOSE: To discuss the optimal year for the next revaluation including information about <br />current market trends and statistics, current economic indicators, potential impacts, and <br />potential full list and measure; and to consider approval of a resolution establishing the year for <br />the next general reappraisal of real property in Orange County. <br />BACKGROUND: The Orange County Tax Administrator's Office conducted property tax <br />revaluations in 2005 and 2009. Current tax assessments still reflect market value as of January <br />1, 2009. With a four -year revaluation cycle, the next revaluation would have occurred in 2013. <br />However, at its May 15, 2012 regular meeting, the Board of County Commissioners (BOCC) <br />received a presentation from the Tax Administrator recommending postponing the 2013 <br />revaluation to 2015. The BOCC subsequently approved a resolution (Attachment 1) to accept <br />this recommendation and delay the revaluation to 2015. <br />Sales prices for real property are now improving. The County's sales ratio stands currently just <br />under 1.04, which means tax assessments represent less than 104% of current market sales, <br />generally. However, this ratio is on the decline and likely will be near 1.00 by January 1, 2015. <br />Should that ratio be achieved, tax assessment and market value would be synonymous, from a <br />general statistical standpoint. Based on this information, continuing with the current plan for a <br />2015 revaluation would result in virtually no change in value for a vast majority of properties. <br />Delaying the scheduled January 1, 2015 revaluation until January 1, 2017 is within the legal <br />authority of the Board. Since the Great Recession of 2008, the Orange County real estate <br />market has been in flux. Approving a 2017 revaluation will allow the tax office ample time to <br />complete a full list and measure revaluation, thereby improving upon current tax records and <br />the overall revaluation experience. Delaying this action, in addition, will present the tax office <br />