2008-04-07 CC Agenda Special
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City of Albertville Council
Board of Review Agenda
APRIL 7, 2008
5:30 PM
PUBLIC COMMENTS -The City of Albertville welcomes and encourages public input on issues listed
on the agenda or of general community interest. Advertised public hearings are scheduled as such so that
the public is afforded an opportunity to speak. Citizens wishing to address the Mayor and Council
regarding specific agenda items, other than public hearings should indicate so and will be afforded an
opportunity during the discussion of said item, Council willing and time pennitting. Citizens wishing to
speak on matters not listed on the agenda (or items on the agenda that did not include an opportunity to
speak) are always afforded the opportunity to do so under the heading "Citizens Addressing the Council",
usually ~cheduled at the beginning and end ofthe agenda. Presentations are limited to five (5) minutes. In
any case, citizens are asked to complete a 'Request to Speak Card'.
1. CALL MEETING TO ORDER
2.' BOARD OF REVIEW
3. ADJOURNMENT
M:\PubJic Data\City Council\Council Packet information\2008\04-07-08\04 07 2008 I-Bd Rev Agenda.doc
AFFIDA VIT OF POSTING
STATE OF MINNESOTA )
) SS.
COUNTY OF WRIGHT )
Tori Leonhardt, being first duly sworn, says that on the 4th day of April 2008, Tori posted
the documents as shown on the reverse side a true copy of each thereof at 1:30 p.m. at the
Albertville City Offices in the window, at the City of Albertville, County of Wright, State
of Minnesota.
Subscribed and sworn to before me this
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~~ day of
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,2008.
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""....':"\ Tracey Nubbe
f Notary Public
_.,~~ Minnesota
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C:\Documents and Settings\tleonhardt\Local Settings\Temporary Internet Files\OLK21 \Affidavit of Agenda Posting format.doc
Clerk's Posted Notice
ASSESSMENT NOTICE
NOTICE IS HEREBY GIVEN, That the Local Board of Appeal and Equalization of the City of Albertville of
Wright County, Minnesota, will meet at the Office of the Clerk in said City, at 5:30pm, on Monday, the 7th day of April,
2008 for the purpose of reviewing and correcting the assessment of said CITY OF ALBERTVILLE for the year, 2008.
All persons considering themselves aggrieved by said assessment, or who wish to complain that the property of
another is assessed too low, are hereby notified to appear at said meeting, and show cause of having such
assessment corrected.
No complaint that another person is assessed too low will be acted upon until the person so assessed, or his
agent. shall have been notified of such complaint.
Given under my hand this
5'th
day of met. rch , ~ DO g
Year
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Clerk of the ~ of AI be,y\-o ; tl.(L
* Applies only in Cities whose charters provide for a Board of Equalization.
AFFIDAVIT OF POSTING
STATE OF MINNESOTA)
) SS.
COUNTY OF WRIGHT )
..,
Bridget Miller, being first duly sworn, says that on the 5th day March 2008 Bridget posted
the documents as shown on the reverse side a true copy of each thereof att:-30 p.m. at the
Albertville City Offices in the window, at the City of Albertville, County of Wright, State
of Minnesota.
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Subscribed and sworn to before me this ~ - day of Jl)ardf\
Notary Public
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TO~'ANNLeONHARDT
NOT.<\,i{ PL:8L1q.MINN~SOTA
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M:\Public Data\City Council\Council Agendas\Affidavit of Agenda Posting format.doc
, 2008.
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March 27, 2008
Gregory A. Kramber
Wright County Assessor
Wright County Government Center
10 2nd Street NW, Room 240
Buffalo, MN 55313 -1183
Phone: (763) 682 -7367 / (763) 682 -7368
1 (800) 362 -3667
FAX.- (763) 684 -4553
www. co. Wright. mn. us
To: Elected City and Township Officials, Administrators, etal.
RE: Upcoming Boards of Review
During our sales study period of October 1, 2006 through September 30, 2007 there were 1,361 qualified
residential home sales in Wright County. At the beginning of this study period, gas prices were
approximately $3.00 per gallon. The Federal Reserve was increasing interest rates earlier in the year
which affected mortgage rates, increasing them by more than a full percentage point. This combination
pushed home affordability down as monthly payments and expenses rose beyond what was realistic for a
lot of potential home buyers. Despite what many experts were arguing, it was not a buyers market, it was a
stagnant market. Sellers' asking prices were still high and the ability to finance a home was getting more
expensive. In Wright County, homes that were attractively priced sold. Buyers were selective and were
not willing to pay premiums. Inventories of property for sale stayed fairly consistent and market time was
increasing as many potential sellers' expectations were still based on what had occurred previously in the
market. Many of the properties that were on the market were just overpriced.
The increase in mortgage rates was also beginning to have an impact on riskier marginal borrowers that
purchased their homes with adjustable rate mortgages. These loans were originated by subprime lenders in
a setting of lenient underwriting standards and what seemed like non - existent regulatory control. The
increase in adjustable rates, along with stagnant home prices began a foreclosure cycle as some of the
marginal borrowers were unable to pay their adjusted mortgages. These subprime loans were packaged
into bond -like instruments and sold to larger institutions on Wall Street and abroad. As foreclosures began
to increase (which was near the end of the ratio study period), the Federal Reserve was beginning to realize
that there was a problem with the real estate market and that it was affecting the overall economy. They
responded by cutting rates by '/2 of one percent in mid September of 2007.
In Wright County, we noticed early on in our ratio study period that a slowdown was occurring in the local
real estate environment. Townhome markets were seeing declining prices in most areas and prices for
homes being sold, compared to assessed value, were only increasing in the low single digits. We were also
seeing something that we had not seen in quite some time. Seller paid concessions were starting to again
show up on certificates of real estate value (this is a document that is filled out by the buyer or seller at
closing) in the form of points and closing costs. Toward the end of our study, defaulting subprime loans
were causing an increase of foreclosures in the market. We were also noticing at this time that the market
was beginning to retract and prices of homes in certain areas were beginning to sell below assessed value.
New home construction and the market for new homes were contracting significantly as builders attempted
to reduce inventory and reassess the need for new homes. The amount of new construction in the form of
1 I
new housing units dropped about 45 percent (1595 units vs. 902 units) from the prior year, and recording
of new plats also fell significantly countywide.
The Wright County Assessor's Office has always tried to exercise a conservative approach to the valuation
process. There is a legislative mandate that all property is to be valued at 100% of market value, with a L/
range of 90% to 105 %. During this last ratio study Wright County had a ratio of 94.8% of the assessed
valuation to actual sale price. After this years' assessment there was an overall decrease of two percent
from the prior year in assessed valuation, excluding new construction. This was in recognition that the
market was beginning what appears to be a downward cycle. There are statistical calculations that measure
the uniformity of the assessment process which get less recognition but mean a lot more to the assessor.
The International Association of Assessing Officers recognizes that lower statistical deviations of sale
prices, when compared to assessed value, results in a more uniform property assessment. This statistical
measure is known as a coefficient of dispersion (COD) and the IAAO standard for a uniform assessment is
a COD of 10 or less in fairly homogeneous areas. Wright County has traditionally had a COD of between
seven and eight, indicating appraisal uniformity.
We expect that the current market will be influenced by an increased rate of foreclosure properties during
our upcoming sales ratio study (which began in October 2007 and will continue to September of 2008).
Buyers are hesitant in the current environment in anticipation of lower home prices and also anticipating
that Federal Reserve cuts will relate in lower mortgage interest rates. The Federal Reserve cut interest rates
drastically three times since January, 2008 and the Federal Government is implementing an economic
stimulus package in an attempt to restore confidence in the housing market and the overall economy.
Current 30 year mortgage rates are attractive; however, prices of fuel, food and other commodities appear
to be rising. This may have an adverse effect on the real estate market. We are being bombarded by the
media that we are headed for a recession and sometimes it appears that we must fulfill the media
predictions in order to move forward. On the bright side, discussions with local realtors and brokers do
suggest that sellers appear to be more realistic when pricing homes for sale and inventories appear
favorable. Improved housing affordability and improved financial capacity will be enticing for many
buyers, while others will employ a wait and see attitude before deciding to buy.
As we come nearer to the city and township Boards of Review for the various districts within the County it
is very important that all of us recognize the date of the sales ratio period; it is from October 1, 2006 to
September 30, 2007. The sales data from this time period is what we are required to use to value property
as of the mandated January 2, 2008 date. With the onslaught of attention that has been given to what is
happening now, we may have residents attempting to have their valuation reduced because of the current
market environment. If we do this it could create an unequalized assessment. Our appraisals are based on
market derived computer aided valuation models with data comprised from our sale study period and
similar properties are valued alike. The Wright County Assessor's Office made every attempt to adjust for
market conditions for all neighborhoods. Changing value because of current market circumstances at the
Board of Review will create an unfair advantage to the petitioner compared to the neighboring properties if
this were to occur. Changes for errors and omissions should be the focus of the Board of Review. Our
office, is aware of continued deterioration of market conditions in the current ratio study period. If the
situation continues to persist, we will be making necessary adjustments in the upcoming assessment.
he Assessor's office, I would like to thank all of you for your past support and look forward
our positive relationships.
Grime y Kramber
Wright County Assessor
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