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Journal of Property Tax Assessment & Administration

Ron Rakow

Abstract

A nationwide analysis of property tax assessments and sales data over a ten-year period, by Christopher Berry of the Harris School of Public Policy at the University of Chicago, found pervasive regressivity in assessments and therefore in the property taxes that incorporate these assessments. This challenges the assessment community to critically examine the valuation process for property tax purposes. The nationwide analysis covers 2,600 counties over the period from 2007 to 2017, and its associated website provides standalone reports analyzing data for each county in the national study. This paper examines 2017 data for Suffolk County, Massachusetts, provided by the state department of revenue (DOR), and finds mixed results in comparing its findings to those in the standalone report for Suffolk County on the Harris School website. It supports the conclusion that lower-priced properties are assessed at higher levels than are higher-priced properties but not to the same extent. The Harris School study appears to mismatch the year of sales and the year of assessments in its analysis of Suffolk County, which can distort its results. Most significantly, the impact of tax exemptions, specifically homestead exemptions, appears to have been omitted from the Harris School study. The comparative analysis demonstrates that such exemptions when properly structured and targeted can lead to a progressive property tax incidence, as they have in Suffolk County.

Keywords

Assessment sales ratio studies - Massachusetts; Assessment performance measures; Property tax administration

Notes

I very much appreciate the invaluable insights and assistance provided by Joan Youngman, Semida Munteanu, and Sydney Zelinka of the Lincoln Institute of Land Policy. Their comments and suggestions improved this study significantly. Thanks also to Paul Bidanset of the Center for Appraisal Research and Technology, who assisted in the preparation of the statistical analysis and maps for the assessment ratio study used in this report.

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