Atherton:  This counterargument works only if all property owners
challenge their assessments.  If some fraction do not
then my theory holds.  Businesses make "billing" errors
all the time; it's a time honored strategy.

Brandt:  We're talking downtown skyscrapers with millions of dollars at stake.  
These are sophisticated property owners.  There are lawyers who earn a good 
living arguing the case for lower valuations.  They argue for a bigger decrease 
when valuations are headed down.  They argue for a lesser increase when 
valuations are headed up.  This keeps assessors on their toes.  Your argument 
works better if you're dealing with small-time property owners like me.  We're 
less likely to take time off work to appear before county and city boards of 
equalization to appeal our property values, which people may do instead of or 
before going to court.  I've never done so because my homestead, like most, is 
assessed for far less than what it is appraised for by my mortgage lender.  And 
lenders are fairly conservative.  If you want to see an equalization board in 
process, they're happening in April and May at the city level and in June for 
the county level.  Having observed the county-level board, I can report that 
they're interesting for about the first half-hour.

Atherton:  I thought that the title of the post was "Skyscraper 
valuations going up."

Brandt:  It's like a rollercoaster.  Sometimes down, as in the past few years 
for downtown property, often up.

Atherton: I think that the most important question is the relationship
between the revenue and debt curves.  Do you have an answer?

Brandt:  I don't cover this area.  You can probably do field research on this 
in Carol Becker's home library.  Or get the prospectus for the most recent city 
debt offering.

Steve Brandt
Kingfield
   


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