County Assessor Cindy Blagsvedt presented the Fillmore County 2017 assessment summary at the Fillmore County board of Appeal and Equalization meeting held on June 13.
The total value of all property within the county increased 9.9% over the prior year. The increase was driven by 11% plus increased value of Ag/rural land and Seasonal Recreation land. There were 23 bareland sales over 34.5 acres with no change in tillable land values, but a 20% increase in nontillable land value. Tillable values range from $4,300 to $7,100 per acre depending on soil type. Pasture value increased from $2,400 to $2,900 per acre. Woods increased from $1,600 to $2,000 per acre and Waste land increased from $900 to $1,200 per acre. Recreational land increased from $2,500 to $3,000 per acre.
Residential value across the county increased 4.38% with 259 sales county wide. Thirteen commercial sales county wide showed a slight increase in value.
The value of new construction was down 19% from a total county wide of $19.4 million (built in 2015) to $15.7 million (built in 2016). About $8.9 million of the new construction built in 2016 was in the townships and $6.8 million in the cities.
Appeal
Brent Hagan made a case for the reduction of the estimated market value (EMV) on property he purchased in Spring Valley on April 14, 2017 for $58,000. The property is the old Olmsted Medical Clinic which was vacated and has remained empty since January 13, 2014.
The valuation was reduced upon reassessment in April 2016 for taxes payable in 2017 from $258,000 to $185,000 due to functional obsolescence and extended vacancy.
Hagan plans to repurpose the building as an apartment building for two to four apartments. The classification on the building was changed from commercial to non-homestead residential by the Spring Valley City Council. In order to convert the building into four apartments, Hagan will have to apply to the city of Spring Valley for a variance for a four unit townhome/apartment building.
Hagan explained he will be gutting the building and installing windows and doors. Commissioner Gary Peterson said the building is in an area which is primarily residential. Hagan brought information to the meeting on other real estate listings for duplexes and triplexes.
Appraiser Brian Hoff said the building sits on an area comparable to a double lot. On April 10 the classification was changed but the Spring Valley Board of Appeal and Equalization made no change in value. The building has not been reassessed as a two unit (or more) apartment residence.
Chairman Randy Dahl commended Hagan for his plans to reuse the old building. He questioned whether the value should be reduced while the renovation is taking place.
Hoff said he looked at the properties Hagan found and said they are valued at $50 to $60 per square foot. Fifty dollars per square foot would give the property a valuation of $171,000 and with 50% depreciation due to gutting the building, the value could be under $100,000. The $60 per square foot value could make the property value just under $125,000.
Blagsvedt noted that with the gutting of the building we regularly reassess value. Peterson told Hagan his efforts are well taken, adding he has offered a solution (for a building empty for three years). When it was noted that the purchase price was $58,000, appraiser Ron Vikre stated, “One sale does not make a market.”
A motion was made to reduce the value to $100,000. Commissioner Mitch Lentz suggested it could be reduced to $75,000. The motion passed four to one, Lentz voted no.
Two other valuations were already reduced prior to the meeting by the assessor’s office. Hoff explained the Ostrander State Bank property valuation was reduced from $161,000 to $83,400 for taxes payable in 2018. The reduction was due to the building being vacant for several years with no prospect of a sale of the building.
The other property (Marchant Motors) in Spring Valley was reduced in value upon inspection in August 2016 from $127,000 to $111,700 for taxes payable in 2018. There had been no change in value at the Spring Valley Board of Appeal and Equalization meeting in April. The adjustment was due to the location of the building which is built over Spring Valley Creek. The future use of the building is limited. No further change in value was deemed appropriate.
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