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Fulton is undervaluing some commercial

properties; so now what?
Maggie Lee (https://saportareport.com/author/maggie/) • August 12, 2019 4:58 pm

Fulton County Government Center. Credit: Maggie Lee (https://saportakinsta.s3.amazonaws.com/wp-

content/uploads/2019/08/Fulton-County-Government-Center.jpg)
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( // /
By Maggie Lee

The people who are supposed to set the taxable value of Fulton’s buildings are
(https://saportareport.com/)
“outgunned” by commercial property owners and hired experts, says a county
commissioner.

The next step, said Fulton County Commissioner Lee Morris, is to ask the state
Legislature for the right to see more nancial information from commercial property
owners who are appealing valuations.

Fulton’s commercial property owners, cumulatively, are walking away with property
valuations that are lower than property sales prices, according to a new review by
Fulton County auditors (https://saportareport.com/?attachment_id=91604) of 175
properties from 2016 through 2018.

Those properties were appraised at about $2.8 billion together. But, together, they sold
for about $4.2 billion.

It follows other reports that found similar under-vaulations of commercial properties.

Fulton needs to ask the Georgia Legislature “to give us the right to get any audited
nancials from the property owner if they appeal, to get any appraisals that they’ve
paid for and get information about their income and expenses, so the playing eld will
be level,” said Morris, who rst asked for the review.

Morris said members of the county Board of Equalization (which hears some appeals
from the Board of Tax Assessors) are good, involved citizens, but that they’re laypeople
who get little education on the complex business of valuing skyscrapers or huge
shopping centers.

The appeals process resulted in commercial valuation reductions of about $7 billion

cumulatively over the last three years, according to Fulton’s report. Fulton’s tax
Related Stories
property rate has been around 10 mills lately, meaning that had those appeals failed, it
would have been worthReporter’s
about $28 million
Notebook: more to Stadium
Mercedes-Benz the county alone
becomes FEMA over those three
vaccination site (https://saportareport.com/reporters-notebook-
years. mercedes-benz-stadium-becomes-fema-vaccination-
site/sections/reports/hannah/)
( // /
In addition to that, the city of Atlanta and Atlanta Public Schools would also be due
perhaps tens of millions more in taxes, if commercial property values were set higher.


(https://saportareport.com/)
Most of the properties under Fulton’s review had a three-year property tax freeze in
place. Those freezes by default stay in place even if a property changes hands at a
higher price — though the Board of Tax Assessors can unfreeze values if a building is
substantially improved, gets more tenants or undergoes other material change.

Jason Esteves, chair and at-large member of

the Atlanta Board of Education, said the
valuations affect students and their families.

“That’s a lot of money that would give

(https://saportareport.com/fulton-is-
undervaluing-some-commercial-
properties-so-now-what/fulton-
county-government-center/)
Fulton County Government Center. Credit: Maggie Lee
taxpayers relief on the residential side, but
would also provide the school system the
opportunity to provide students with much-
needed resources.”
It’s perfectly legal to appeal valuations, and
all kinds of property owners do.

But costly lawyers and real estate experts

are a relative bargain for the owner of a
Downtown skyscraper with a property tax bill in the hundreds of thousands of dollars,
versus the value for a small homeowner.  And such professionals are successful.

“We reviewed the effect of having a tax representative, during the appeal process and
noted having a tax representative has a signi cant impact on the success of an
appeal,” Fulton auditors reported. That is, a success rate of 59% and 69% in 2016 and
2017 respectively.

The report recommends things like Related

more training for Board of Equalization folks. But
Stories
the report also makes what sound like hints under the heading “management
Reporter’s Notebook: Mercedes-Benz Stadium becomes FEMA
concerns.” Such as: audited nancial
vaccination statements and appraisals from property owners
site (https://saportareport.com/reporters-notebook-
mercedes-benz-stadium-becomes-fema-vaccination-
site/sections/reports/hannah/)
( // /
would give proof of a building’s value if the board had such documents.  Or, if appeal
hearings were recorded, it could support decisions made or “foster a more 
professional environment.”
(https://saportareport.com/)

Fulton Chief Appraiser Dwight Robinson agrees with the report and its
recommendations, according to his written comment
(https://saportakinsta.s3.amazonaws.com/wp-
content/uploads/2019/08/Management_Response.pdf) published with it. Though at an
unrelated Monday press conference, he urged Fulton residents to read the report itself
(https://saportareport.com/?attachment_id=91604), because some properties are
valued below market rate for proper reasons.

Local rules and state laws behind appraisals are complex; some things can probably be
changed by Fulton County (like funding for staff) but some things may require changes
to state law.

State Sen. Jen Jordan, D-Atlanta, said she’s glad there’s more attention lately for
Fulton’s commercial property tax digest.

“The only thing that we know right now is that the current system doesn’t work, and
we are missing out on tax revenue from commercial property owners that ends up
costing residential property owners that much more,” Jordan said.

Jordan said the Development Authority of Fulton County needs to stop working within
the city of Atlanta, where the city’s own economic development authority works. From
January through July of this year alone, the two authorities granted preliminary or nal
approval for commercial property tax discounts in Atlanta worth $163 million over 10
years (https://saportareport.com/developer-property-tax-breaks-in-hot-atlanta-
neighborhoods-raising-questions/). It’s mostly been in Midtown. (Jordan said she
thinks the county can cut DAFC out of Atlanta without the state Legislature; but on the
other hand, there was an attempt in 2013 to do just that via the state Legislature
Related Stories
(http://www.legis.ga.gov/Legislation/en-US/display/20132014/SB/228).)
Reporter’s Notebook: Mercedes-Benz Stadium becomes FEMA
vaccination site (https://saportareport.com/reporters-notebook-
mercedes-benz-stadium-becomes-fema-vaccination-
site/sections/reports/hannah/)
( // /
As for xing valuations, Jordan said it might be time for some creative thinking. For
example, some counties outsource the complex work of valuing commercial properties.


(https://saportareport.com/)
“We really have to diagnose exactly what the problem is and then try to say, ‘OK, is this
a legislative x? Is this some kind of [Fulton] operational x?,'” she said.

Over in the state House, state Rep. David Dreyer, D-Atlanta, said that about two months
ago he asked a staffer to start working with the state Legislature’s in-house counsel to
research what might be done under the Gold Dome about assessments. Dreyer said
low commercial valuations are unfair to residential property owners.

“Over the last couple years, we’ve really been looking at trying to nd equitable
property tax relief (https://saportareport.com/georgia-legislature-sets-up-atlanta-tax-
votes-but-not-for-beltline/), property tax relief that gives homeowners who need
relive the most relief, the most relief,” said Dreyer.

If Fulton, APS or city of Atlanta leaders determine they want to lobby for some change
in state law regarding assessments, that ask would probably be detailed via each one’s
“legislative agenda,” documents which would be nalized in November or December.
The annual state legislative session starts in January, 2020.

The new Fulton report tracks ndings in another one done for the city of Atlanta
(https://www.ajc.com/news/local/atlanta-report-shows-commercial-properties-
undervalued-for-taxes/8Fj6BjvCEtkjIVfZIQPvrN/) earlier this year. Reviewing a sample
of 176 properties, the company MuniCap found properties worth $20 million or more
were valued for tax purposes at about two-thirds of their fair market values. Properties
worth less than $250,000 were valued just about right — at about 98 percent of value.

The Fulton  report also tracks a report done for the Atlanta Journal-Constitution and
Channel 2 Action News last year (https://www.ajc.com/news/local-govt--
politics/fulton-tax-of cials-often-undervalue-atlanta-commercial-
Related
properties/hv9BNyRMoEJLOzCnsxvXcJ/), Stories
as well as the previous analysis

Reporter’s Notebook: Mercedes-Benz Stadium becomes FEMA

vaccination site (https://saportareport.com/reporters-notebook-
mercedes-benz-stadium-becomes-fema-vaccination-
site/sections/reports/hannah/)
( // /
(https://www.ajc.com/news/local-govt--politics/fulton-tax-of cials-often-undervalue-
atlanta-commercial-properties/hv9BNyRMoEJLOzCnsxvXcJ/) of Julian Bene, a 
management consultant and activist.
(https://saportareport.com/)

“We can’t be letting commercial property roll over us,” Bene said.

He called on the county to own the problem and x it.

Document:

Fulton Tax Assessors Of ce Review – Commercial Properties

(https://saportareport.com/fulton-is-undervaluing-some-commercial-properties-so-
now-what/tax_assessors_of ce_review-commercial_properties_ nal_/)

Management Response (https://saportareport.com/fulton-is-undervaluing-some-

commercial-properties-so-now-what/management_response/)

Tags:
Atlanta Public Schools (https://saportareport.com/tag/atlanta-public-schools/)
commercial property (https://saportareport.com/tag/commercial-property/)
commercial valuation (https://saportareport.com/tag/commercial-valuation/)
Fulton County (https://saportareport.com/tag/fulton-county/)
property taxes (https://saportareport.com/tag/property-taxes/)
state legislature (https://saportareport.com/tag/state-legislature/)

(https://saportareport.com/author/maggie/)

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Maggie Lee (https://saportareport.com/author/maggie/)

Maggie Lee is a freelance reporter who's been covering Georgia and metro Atlanta government and politics since
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September 18, 2020 8:57 pm

3 Comments

Julian Bene • August 12, 2019 10:37 pm

Good piece with one key caveat. It’s not tens of millions that we’re losing from commercial underpayment. It’s
HUNDREDS of millions.
The calculation starts with commercial assessments coming in at 56-66% of sale prices, i.e., fair market. They should be
coming in at not less than 90% of market, just as homes do.
Getting them there would raise the commercial digest by about 50%.
That’s worth $300M in school, city & county taxes. Report
Reply

Maggie Lee • August 13, 2019 9:00 am

In the interest of transparency, I’ll explain that I went with the lower number because I was just thinking of the city of
Atlanta/APS only; and I don’t know how much of Fulton’s commercial digest is in the city. And also because I was talking
about the value knocked off due to appeals, which the report puts more in the high teens.
That being said, yes, please, and thank you for noting: let the record re ect that all reports have said commercial
properties’ values are coming in as low below sale prices as you noted. Report
Reply

Russell Wagner (http://www.taxfence.com) • August 14, 2019 9:59 am

We built the platform http://www.taxfence.com (http://www.taxfence.com) so that homeowners in Fulton, Dekalb, and
Related Stories
soon Gwinnett/Cobb will be able to know the close to/exact value of their home for their appeal. We then report back
all the data we receive on their appeals back to our consumers. Same transparency should be had for commercial to the
Reporter’s Notebook: Mercedes-Benz Stadium becomes FEMA
Atlanta consumers. Report
vaccination site (https://saportareport.com/reporters-notebook-
Reply
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