The fastest solution for Nassau’s property assessment disparity? A recession.
Nassau County officials expect a reassessment plan to eventually restore accuracy to assessments and end the tax shift. Here's how it could play out.
A planned reassessment of all Nassau County property would limit assessment increases on those homes that are deeply undervalued to no more than 6 percent per year or 20 percent over five years. Officials have described the plan as a phase-in of the tax bill increases the reassessment would cause.
However, experts say assessment increase limitations tend to benefit higher-valued properties, which tend to be the most undervalued. A Newsday analysis of the potential outcomes suggests the plan may take years to correct the inequities. Under some scenarios, it could exacerbate them.
A tale of two neighborhoods
Tax bill disparities are spread throughout the county in every school district. But to get an idea of how the county’s plan might play out, consider a comparison of Manhasset school district homes, which frequently benefited from the county’s 2010 tax assessment overhaul, with homes in the predominantly minority Uniondale school district, which benefited less frequently.
If the real estate market stays constant
If the real estate market remained constant and didn’t cause homes to go up or down in value over time, the disparity between the two districts would start closing after 9 years and cease after 13 years. County legislators reviewed a similar projection before approving the plan.
Years of planBut it’s not that simple, because property values tend to fluctuate.
Since a county tax overhaul began in 2010, property values have increased annually at an average rate of 4.3 percent in Manhasset and 0.2 percent in Uniondale. If those trends were to continue, the disparity would never close and would instead double in three years. This is the scenario assessment experts say tends to occur.
Years of planA recession might actually help close the gap.
If a recession caused values in Manhasset and Uniondale to decrease at the rate they had been increasing, the disparity would close in three years. Manhasset tax bills would increase during the recession. If the recession lasted more than 3 years, Manhasset homes would pay a disproportionate share of the tax burden between years three and nine of the reassessment.
Years of planNassau looks at tax relief plan for homeowners
The tax shift in Nassau County has reached about $2.2 billion, up from $1.7 billion last year, as detailed in Newsday’s “Separate and Unequal” investigation.
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