Plaza tax break is just one example of how the average taxpayer ‘is getting screwed’

Jackson County’s nagging difficulty with appraising property is back.

The county valued 26 properties on the Country Club Plaza at $375 million this year, The Star reported Sunday. Last year, those properties sold for $660 million.

That would have been worrisome enough. After appeals, though, the total value was reduced even more, to $145.5 million — roughly 22 percent of the purchase price.

The news should concern every taxpayer.

Taxes should be low, of course, but they must also be fair. Taxpayers of equal means, resources and property should face roughly equal tax burdens.

Instead, the owners of the Plaza appear to have received a legal tax break that would likely be unreachable for the average citizen. The Plaza will likely save $3 million on its property tax bill this year because of the convoluted appraisal and assessment process.

“The average Kansas City taxpayer is getting screwed,” said Crosby Kemper III. We agree, although we’d add all Jackson Countians to the mix.

The owners of the Plaza aren’t to blame for this state of affairs. There is no indication of improper influence or illegality in the appraisals. The Plaza need not pay more in taxes than it owes.

But something is wrong when the owners of a $660 million property pay taxes based on a $145 million appraised value. That kind of discrepancy can only lead to distrust among taxpayers, who will think they’re being treated unfairly.

There are indications the Plaza adjustments are just the tip of a very troubling iceberg. Public officials and tax consultants believe commercial properties in the county are notoriously undervalued, particularly compared with homeowner appraisals.

County officials dispute this conclusion. They point to a “ratio study” by the Missouri State Tax Commission, which uses a statistical analysis to determine if a county’s appraisals are fair.

In that study, the county’s commercial appraisals appear in line with those of other counties, although they’re less accurate than residential appraisals.

Such averages are essentially meaningless, though, for taxpayers. If the county undervalues one property, another property must be overvalued for the average to fall into the acceptable range.

That’s unfair to almost everyone. It also takes tax dollars away from priorities such as Kansas City Public Schools.

Jackson County has been through this before. In 2013, the biennial re-appraisal process brought howls from homeowners — some 18,000 appraisals appeared to be “irregular.” The scandal led to the resignation of the assessor.

Property taxes are hated more than any other levy, and for good reason. Basing tax collections on an estimate of property value can lead to misunderstandings and mistakes, concerns that are worsened because tax bills are hard to scrutinize.

Jackson County Executive Frank White and the Legislature must add taking a hard look at the assessor’s office to their to-do list. A rigorous audit of the appraisal process — and publication of the results — could help Jackson County taxpayers regain trust in what appears to a broken system.

This story was originally published October 16, 2017 at 4:49 PM with the headline "Plaza tax break is just one example of how the average taxpayer ‘is getting screwed’."