Grand list shows increase, yields insight to future
By Christian Mysliwiec - Staff Writer
Manchester - posted Thu., Jan. 31, 2013
How much is your home town worth? If you call Manchester home, try $3.9 billion. The October 2012 grand list was signed Friday, Jan. 25, and reveals the total assessed value of real estate, motor vehicles and personal property in Manchester to be $3,916,215,474.
According to John Rainaldi, director of assessment and collection for the town of Manchester, the amount is $28.5 million, or 0.73 percent, more than the previous 2011 grand list. How and why these two values are different reveal interesting insights about the town's economy, and provide an indication for things to come.
At $3.3 billion, real estate accounts for 84 percent of the 2012 grand list. Since assessors used the real estate values from the last town-wide revaluation in October 2011, one might assume that the figure would be the same as the 2011 grand list. In actuality, it is 0.2 percent less, representing a drop of $6.5 million. This is due in part to assessment appeals filed after that 2011 revaluation.
“When we do a reval, if taxpayers, for whatever reason, think there's a mistake, they're able to file an appeal,” said Rainaldi. There are three levels of appeal: an informal session held by the evaluation company, a town Board of Assessment Appeals hearing, and, once the board responds to the appeal, they can appeal further at the Superior Court.
“In a typical reval year we usually get a hundred of those,” he said. For the 2011 revaluation, there were 98 property appeals to the Superior Court. The appeal process can take several years to finalize, hence the effect on this year's list.
Another factor contributing to the 0.2-percent drop is that some formerly taxable properties are now tax-exempt, usually because they have been sold to charitable, religious or government entities using them for tax-exempt reasons. For example, when the town purchased the Manchester Parkade, it became non-taxable.
The motor vehicle assessment saw a 0.22-percent increase. Based on recent history, an even larger increase was expected. The low increase is due to a return to normal depreciation rates after a period of slowed depreciation.
“In 2009, 2010 and 2011, we noticed used-car values were not coming down the way they used to,” said Rainaldi, noting that 10 to 15 percent a year is normal. One possible explanation for the slower rates would be the “Cash for Clunkers” program, which in 2009 gave incentive to consumers to trade in their old vehicle for a new, fuel-efficient vehicle. Cars that were turned in were scrapped, thus reducing the national supply in the used-car market and increasing the value of those that were left.
“What's interesting about that is all three of the major pricing sources, NADA [National Automobile Dealer Association], Kelly Blue Book and Edmunds all showed the same trend,” Rainaldi said. “This year, we're back to the traditional depreciation that we've had... back in 1993 through 2008.”
There was a dramatic increase in the personal property grand list. With a total valuation of $284 million, the figure is up $34 million, or 13.7 percent, from 2011. More than half of this increase is due to Manchester's second highest taxpayer, Connecticut Light & Power, which has significantly replaced and expanded its personal property in town. Also noteworthy is the opening of an account by United Illuminating, the utility company serving Greater New Haven and Bridgeport, for an assessed $4.4 million.
In addition to CL&P, two other personal property accounts meteored in growth by roughly $1 million in 2012: Hartford Distributors and TD Bank. Bob's Discount Furniture, Cisco Systems, Buffalo Wild Wings and JC Penney also contributed to the sizable growth in personal property.
With new equipment and fixtures, Walmart/Sam's Club again found a spot on the top 10 list - albeit second to last - with a net assessment of $21.6 million. A Super Walmart is expected to be built this year in the former K-Mart plaza on Silver Lane. “When they build that new store there, it will be a very significant addition, both in real estate and personal property,” said Rainaldi.
While the 13.7-percent increase in personal property is an incredible boost to the town, the level of growth cannot last. Since new personal property depreciates over seven years, Rainaldi already forecasts a decrease for 2013.
“There's a tremendous advantage to having that growth on our grand list,” he said. “It's just that over the next couple of years, it is very difficult to maintain that, because this equipment is depreciating.” Because of the amount and suddenness of the growth, a decrease is assured.
With a grand list of $3.9 billion, the fifth highest taxpayer (Manchester Developers LLC, Buckland Developers, LLC), equal 1 percent of the entire list, with a net assessment of $39 million. “If you look at maintaining grand list growth, it becomes very difficult in a mature town, because we would have to add basically the equivalent of our number-five taxpayer every year to equal 1 percent,” said Rainaldi.“We're a very mature town. We're not going to have the amount of development we had in town in the '90s and 2000s coming in every year,” Rainaldi said.