Hamburg, Iowa - Developers Bill Sapp and Les Robbins asked the Fremont County Board of Supervisors to help trim the assessed value of their “undeveloped” property on Highway 2 near I-29.

Recently the Board of Review denied separate petitions filed by Sapp and Robbins to lower the assessed value of some of their property.

“I don’t know what our involvement is. We don’t make assessments and we can’t change your assessments,” said Supervisor Chuck Larson.

Sapp inferred that the Board of Supervisors could speak with the assessor and the board of review to reduce the assessed value, otherwise he would go to court or just stop paying taxes on the property and let it go to a tax sale.

“You can talk to her (County Assessor Karen Berry)” Sapp said. “I don’t want to look at this as a threat, but we’re looking for a solution.”

Unlike others within the courthouse, Berry is not technically a county employee. She is an “agency” and does not answer directly to the Board of Supervisors, but instead answers to the Conference Board, which is comprised of the mayor of each town in the county, as well as a representative of each school board and the Board of Supervisors.

Typically the board only meets twice, early in the year — once to approve the budget and again to adopt it after a public hearing and to reappoint the assessor if necessary. This year, members of the board stated they would like to meet quarterly to keep up-to-date with the assessor.

The Conference Board also appoints members to the Board of Review, which is composed of three members from various areas of the county who are familiar with local market conditions and trends. The Board operates independently of the Assessor's Office and has the power to confirm or to adjust upward or downward any assessment. An individual may petition to district court if he or she is not satisfied with the Board of Review's decision or can appeal to a higher board — Iowa Property Assessment Appeal Board.

Sapp and Robbins describe themselves as “speculators,” who are being taxed on the “potential” of their property. Berry says she is following the law and a recent judge’s ruling.

In June of 2008, Judge James Herckerman ruled in favor of the county in a case that was originally filed in 2006, in which Robbins sued the Board of Review over the valuation of property in his Crossroads Development.

While the case was in court, Berry said the value of some of the land was dropped to be in favor of the property owner; however, when the case was resolved, she said she took the judge’s ruling into account and re-assessed the property this year.

Of the three lots of property for which Robbins is currently contesting the assessed value, two were involved in the recent court case. However, they have been re-plotted so are in different configurations.

The total assessed value of Robbins’ vacant land is up from $375,960 in 2008 to $688,620 in 2009. The assessed value of property containing a storage facility is up from $58,600 in 2008 to $114,300 in 2009, to properly account for the building, said Berry.

Sapp is contesting the assessed value of eight lots. The total assessed value of Sapp’s land that is being contested went up from $634,710 in 2008 to $653,900 in 2009.

While the overall assessment has increased, some of the individual values have decreased. A 3.97 acre piece of property owned by Robbins near the front of his development dropped in value by 10.87 percent and a 3.64 acre piece of property owned by Sapp dropped in value by 19.31 percent.

In a letter to the board of review, Robbins wrote, “The reality is that we have not sold any property in our development since June 2006, which is almost three years ago. We have had very few parties contact us in the last three years or so about any of our property in Fremont County....We have had no inquires for over a year now.”

Both Sapp and Robbins said that their land should not be assessed as commercial property but rather as agriculture ground, which has a substantially lower value.

At the May 27 meeting of the Board of Review, Robbins’ petition was denied as was Sapp’s. The minutes state, “Evidence by taxpayer (Robbins) is not sufficient to prove assessment is excessive. An economic condition or situation is not proper grounds for arguing a change in value; therefore, the taxpayer has actually filed under improper grounds in the opinion of the board.”

In his petition, Sapp argued that his farmable ground should be classified as agriculture. The board of review denied this claim, stating that, at the Jan. 1, 2009 assessment date, the property was considered commercial use.

In a 2007 court case in Scott County, a property owner filed a lawsuit against the board of review because he claimed his property was misclassified as commercial use when it should be agriculture. The judge ruled in favor of the board of review and the appeals court affirmed the ruling. It outlines six points made by the Iowa Supreme Court to determine whether a taxpayer is using the property agriculturally:

1. Is the parcel set off and awaiting development? 2. What permitted uses does the current zoning allow? 3. If the parcel is being offered for sale, or if it were, would it be viewed by the marketplace as other than agricultural? 4. How does the land conform to other surrounding properties? 5. What is the actual amount of income produced and from what sources? 6. What is the highest and best use of the property?

At the County Supervisor’s meeting, Robbins and Sapp both agreed their land should be assessed agriculture value until it is developed.

“The property isn’t being improved in the way it could be,” Sapp said. “Just because you put a line on a piece of paper doesn’t make it a commercial lot....every bit that can be farmed is farmed with the exception of a little piece.”

The men said if the assessment stays, it would not be good for them or for the county.

“If it continues, it could jeopardize us and the future of the development,” Sapp said.

The current developments bring in local option sales tax of roughly $6,000 to both the schools and to the county. It is also a TIF (tax increment financing) district, so the county rebates the incremental real estate tax collections above the base real estate taxes to the developers. The developer then uses this money to pay for the improvements plus interest on the loans.

“In economic development, we need to work together as a team and not as adversaries,” Robbins said.

County Supervisor Speck Hendrickson suggested the men speak with the conference board to present their case; however, the board can legally take no action on the assessment.

“The function of (the conference board) wasn’t and it can’t be to change the value and classification of land,” Larson said.

Cory Gorden, chair of the Fremont County Board of Review, suggested the men take their case to the Iowa Property Assessment Appeal Board and said she would get them the information.