Tri-Town Assessing: An Innovative Intergovernmental Agreement
One very effective statutory provision in terms of operational efficiencies is the authority granted under RSA 53-A allowing municipalities to enter into intergovernmental agreements. The stated purpose of this law is to “permit municipalities and counties to make the most efficient use of their powers by enabling them to cooperate with other municipalities and counties on a basis of mutual advantage." The purpose further describes these efficiencies as providing “services and facilities in a manner … that will accord best with geographic, economic, population and other factors influencing the needs and development of local communities."
The most common applications of RSA 53-A include agreements for police and fire services, and for solid waste disposal. A more unique use of RSA 53-A involves the recent enactment of a tri-town intergovernmental agreement for sharing the costs of a full-time assessing department.
Acknowledging the statutory requirements to improve assessing practices as a result of court challenges to the statewide property tax, the towns of Newbury, New London and Sunapee identified an opportunity to work together to meet these new assessment standards. The result was an intergovernmental agreement to hire a full-time professional appraiser who would provide the entire complement of assessing services to all three communities—something that would not have been financially feasible for each town to undertake individually. In addition to cost savings for the assessment and revaluation functions in each of the three towns, both the improvements in assessing practices and the responsiveness to taxpayer’s inquiries have far exceeded expectations.
In another collaborative effort, this article is authored jointly by New London Town Administrator, Jessie Levine, Sunapee Town Manager, Donna Nashawaty, Newbury Town Administrator, Dennis Pavlicek, and Normand Bernaiche, Joint Assessor for the three towns.
Assessing the Need for a Tri-Town Assessor
Years ago, the town administrators of New London and Newbury and the town manager of Sunapee established a schedule of regular meetings to discuss topics of mutual interest and concern that affect the three towns surrounding Lake Sunapee. In 2004, New London and Newbury had completed, and were in the process of defending, their town-wide revaluations; Sunapee was ready to embark on this task. None of the three towns could justify a full-time assessor, yet all believed that the revaluation process would have gone much smoother—for town officials, employees and taxpayers—had there been experienced assessing staff dedicated to the towns. It was the revaluation process that prompted the idea to employ a professional to address the growing assessing needs of all three towns, which included the sensitive issue of valuing waterfront properties along Lake Sunapee. Listing the pros and cons, it quickly became apparent that the pros far outweighed the cons. There were many similarities among the three towns, not only in the need for ongoing statistical updates of property values, but also the fact that all were small towns with common demographics. Combining the assessing function would enable each town to provide more equitable and defendable property assessments, and better customer service to both residents and businesses.
A fiscally conservative plan for a joint assessing department was developed and presented to the respective Boards of Selectmen. First, the current cost of each town’s routine assessment and pick-up work was computed. The additional time required to address abatements, taxpayer questions and review field errors, and legal costs for appeals were factored into the computation. The actual cost for abatements (overlay) as well as the reserve funds that each town had been appropriating for future revaluation or statistical updates was also considered. Finally, each town’s administrative costs (time spent by managers and staff on assessing tasks) were added. The estimated annual cost of the three towns’ then-current assessing practices was approximately $287,000.
The next task was to project the cost of a full-time assessing department to serve the three towns. The estimate for a full-time assessing department was $213,000—surprisingly less than the $287,000 estimated annual cost for the current arrangement. This lower price included not only a full-time assessor, but also a full-time assistant assessor. Sharing two full-time experienced assessors would mean that each town would have someone available to provide individual attention to property owners’ concerns and more equitable valuations of similar properties surrounding Lake Sunapee, as well as a cost savings of approximately $74,000 to be shared by all three towns.
Joint Board and Administration
After unanimously approving the creation of the joint assessing department, the intergovernmental agreement, developed pursuant to RSA 53-A, was signed in May 2005 by all three Boards of Selectmen. In addition to the standard clauses governing the purpose, duration and termination of the agreement, the agreement also created a Joint Board whose purpose was to “hire and supervise the [assessor and staff] and to oversee the sharing of time and costs associated with the joint positions."
The agreement requires that the Joint Board consist of five members: the manager/administrator from each town, a Selectman and a citizen, with the latter two rotating annually among the three towns. Therefore, in any given year, two towns will have two representatives on the Joint Board and one town will have the single manager/administrator representative. The Joint Board has sole authority over two primary functions: (1) compensation, performance evaluation, and discipline of the two assessing positions; and (2) establishing the annual operating budget for the joint assessing department. Notably, the Joint Board is not responsible for any assessing functions, and does not replace the assessing responsibilities held by the Board of Selectmen in each town. That is, the Joint Board is not a Board of Assessors, but rather a contractually created board that oversees the administration of the joint assessing department.
The intergovernmental agreement explicitly outlines the financial arrangement between the three towns. The Town of Newbury budgets for the total cost of the joint assessing department and is reimbursed quarterly by the other two towns, which budget solely for their pro rata share. The two joint employees are employees of the Town of Newbury, and are eligible to receive fringe benefits as are offered to other Newbury town employees. For Sunapee and New London, the pro rata share of costs is based on each town’s percentage of total parcels as of April 1 of the budget year. Since the three towns have approximately the same number of parcels, each is responsible for roughly one-third of the annual cost of the joint assessing department.
Although the three towns assume that the distribution of the assessors’ time will mirror the allocation of the costs, the intergovernmental agreement contains the following important statement: “The Towns recognize that due to revaluation, litigation, or other large projects, one town may require disproportionally more of the Joint Assessor’s attention for a period of time, and that in the long run, use by all Towns should balance out. This is a chance that all three Towns are willing to take and the Towns enter into this Agreement with that knowledge."
The Joint Board meets quarterly, and a recurring topic on the agenda is the distribution of time. The towns have been forthright and honest about their needs, and at no time during the first year has any town felt that the assessors were spending too little time in their town or were otherwise inattentive to the town’s needs. Had concerns of that nature arisen, it would have been addressed by the Joint Board, not by the Boards of Selectmen or by the individual managers/administrators.
The Joint Board established a strong working relationship early in the process when it undertook two search and interview cycles before its unanimous decision to hire Normand Bernaiche as the joint assessor.
Setting Up an Office in Three Towns
The tri-town assessing department consists of the joint assessor, the joint assistant assessor and the three assessing clerks who were previously employed, one in each town. In addition to assessing functions, each of these clerks has other various responsibilities in their particular town. In essence, this results in a part-time person in each municipality who is the initial contact and intake person for assessing issues. An Internet-based, online calendar is utilized by the three clerks , which provides immediate access to the assessors’ schedules and avoids scheduling conflicts between the three towns.
To help coordinate the assessing procedures, a standardized manual was collaboratively developed dealing with everything from the intake of building permits to processing current use applications. The manual incorporates state law and state forms as well as forms and procedures developed locally. The best practices from each of the three towns were identified and standardized to provide consistency in the assessing procedures. It should be noted, however, that there are unique practices that need to remain in place in order to respect the cultural differences between the towns. For example, one town requires that their conservation commission review and comment on all timber intent-to-cut applications prior to approval of such applications. Unique practices such as this are so noted in the manual as applicable to that particular town.
From a functional standpoint, the most important commonality shared by the three towns was the appraisal software. All three towns use identical versions of the same appraisal software. Without such an arrangement, establishing a tri-town joint assessing department would have been significantly more challenging, and nearly impossible to coordinate.
Customer Service Improvements
One of the main objectives of this intergovernmental agreement was to provide routine property valuation updates by in-house assessing staff, thereby avoiding costly town-wide revaluations in each of the three towns. A side benefit, which has greatly exceeded expectations, is the customer service afforded by the joint assessing department, primarily through improved communications with taxpayers. Prior to the enactment of the intergovernmental agreement, each town had a contractual relationship with an assessing firm and individuals that visited the towns only as needed. Under the new format, each town has an employee who supports the assessors, manages day-to-day questions, and schedules appointments for the assessors. Taxpayers are unaware of the fact that the assessors are only physically present in his or her town on specific days of the week. What they experience instead is a town department that is highly responsive to their assessing inquiries. In the past, when an assessing question went unanswered, it would often lead to speculation and inaccurate assumptions. Now, with the joint assessing department, a prompt response not only serves to educate taxpayers about the assessing process, but also minimizes those inaccurate assumptions, thereby promoting public confidence that property taxes are being assessed fairly and equitably.
First Annual Review
The Joint Board recently held its first annual review of the tri-town assessing department, and unanimously agreed that performance of the department this past year exceeded expectations. This highly successful program, relying upon the commitment, communication and cooperation of the three partnering communities, exemplifies the efficiencies and benefits that can be accomplished through an innovative intergovernmental agreement.