Agenda 08-26-2025; 6-b - Update on Revaluation Appeals, Studies, and the Tax Assessment Work Group

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2 This report provides a status update on appeals, the results of the countywide and neighborhood level equity analysis, and the Tax Assessment Work Group the County Manager recommended in June. Appeal Status The Tax Office received a total of 3,348 informal appeals during the informal appeal window that was open from March 21 to April 30, 2025. Following the informal appeal window, the Tax Office received an additional 908 formal appeals for a total of 4,256 appeals. Of those, there are 3,909 unique properties, with the overlap representing properties that were appealed at both informal and formal levels. Of the 908 formal apeals, 35 were not submitted by the deadline and will not be considered. Additional appeals will be received as property owners have 30 days to appeal decisions, and the last mailing of decision notices on informal appeals is expected to be at the end of August. Of the 3,909 unique properties appealed, a total of 3,637 were appeals of residential property, and 272 were appeals of nonresidential property. The Tax Office and the Board of Equalization and Review have issued decisions on 3,094 residential appeals and 173 nonresidental appeals. Value adjustments made on residential appeals had a median decrease of $25,990 in value, or about 6%, while value adjustments on nonresidential properties had a median decrease of $288,700, or about 13%. The 944 remaining appeals, along with additional appeals of informal decisions, are scheduled to be completed by mid-December 2025. The Board of Equalization and Review approved post- adjournment meetings through December 11, 2025. Countywide and Neighborhood Equity Analyses As stated above, the County contracted with a vendor to conduct a vertical equity analysis of countywide values. The analysis stratified properties by age, value, and geographic location. Graphs of the results are attached. That analysis showed that, in general, values were within the standards for vertical equity established by the International Association of Assessing Officers (IAAO) when outliers were removed from the analysis. The vendor removed any property where the assessed value deviated from the actual sale price by 25% or more which accounted for approximately 950 of 5,800 sales. The Tax Office independently conducted an equity analysis on the County's 1,026 assessment neighborhoods. The IAAO specifies that measures of vertical equity are only representative of possible inequities in neighborhoods with five (5) or more sales. Of the neighborhoods with more than five (5) sales, the Tax Office identified 86 neighborhoods that were outside of the equity standards used by the IAAO. Of the neighborhoods with less than five (5) sales, the Tax Office examined those neighborhoods for consistency and reasonableness and identified an additional 76 neighborhoods that require a more thorough review. The Tax Office is also studying the 19 neighborhoods identified by the Orange County Property Tax Justice Coalition for possible value adjustments. A total of 171 neighborhoods have been identified by the Tax Office for closer review. In order to expedite that review, the County Manager has authorized the Tax Office to contract with private professional appraisers to supplement current staffing. With this additional staffing, the Tax Office estimates that the neighborhood reviews will be completed by mid-November, prior to the Thanksgiving holiday.