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Talks continue as trial is set in suit on tax reassessments

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A trial is scheduled for March of 2021 in a suit that was filed in January 2018 over how to remedy that all three of Delaware’s counties haven’t done countywide tax assessments in decades.

Talks are continuing, said Mike Brickner, executive director of ACLU Delaware. “We are very hopeful that we can come to a path forward. Our door is always open to talking.”

“This is an important issue of tax fairness that has lingered for decades and needs to be addressed, and we are taking appropriate and measured steps to do so in a way that best balances the interests of the citizens of New Castle County,” said New Castle County Executive Matt Meyer.

“With COVID-19 rates spiking and our federal funding relief aid due to expire in six weeks, we will not commit now to incur tens of millions of dollars of expenses that may hinder our ability this winter to provide testing, protect the most vulnerable in our community and bring job opportunities back to our families,” 

 

 

A Kent County representative did not respond to a request for comment. 

A Sussex County representative declined comment because it’s active litigation.

The ACLU, the Community Legal Aid Society and a New York law firm are listed as the counsel for the plaintiffs, Delawareans for Educational Opportunity and the NAACP Delaware State Conference of Branches. 

In the first page of his May ruling, Chancery Court Vice Chancellor Travis Laster said that avoiding reassessments generates “a broken system for funding schools,” particularly for disadvantaged students. “One third of the funding for Delaware’s public schools comes from local taxes.”

The counties’ last reassessments were in 1974 for Sussex, 1983 for New Castle and 1987 for Kent. 

chart on New Castle County taxes
Residential properties dominate New Castle County’s tax rolls.

Reassessments are inevitable, based on the May ruling, and Brickner said the plaintiffs are asking for commitments to finish reassessments in 2024. The counties are arguing for more time, he added.

“We all know that reassessments need to be done,” Brickner said. “It’s not the most glamorous, but it’s critical for the community.”

A 2017 New Castle County report figured on six to 12 months for the request for proposal process (hiring somebody to do it), three years to assess and two years to handle the also-inevitable appeals. 

New Castle County would spend $10.5 million to reassess its 210,000 parcels and would have to annually budget $200,000 to $450,000 to support new assessment software, the report said.

 

 

The 1983 assessment took two years for 140,000 parcels, the report said. 6,000 appeals were heard by the revaluation firm, and 3,000 took two years for the Board of Assessment Review. “A similar or greater taxpayer response may be expected following reassessment,” the report said.

In the future, properties could be reassessed on a rolling cycle (Maryland does a third every year), or routine intervals (“maybe every five or 10 years”). 

“While revenue-neutral rates are theoretically conceivable, the fact that this case is centered on the adequacy of school funding suggests that increased school revenue may be a component of the court-approved regime,” Saul Ewing Arnstein & Lehr, a Philadelphia law firm with a Wilmington office, blogged in May. “In the end, reassessment is likely to result in tax decreases for a few, tax increases for many and little change for some.” 

Delaware agreed in October to spend tens of millions of dollars more a year on special needs students to settle another aspect of the suit. One catch: the General Assembly has to find the cash.

The main factors in assessments are square footage, living area, quality of construction, condition, location, attached structures (such as decks) and detached structures (such as pools).


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