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Committee Hearing, April 4, 2012

Minutes from Philadelphia City Council Committee Hearings, Apr 4, 2012

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Mr. Mckeithen

Right. We're going to have some industry measures that demonstrate that the property assessment after we're done based on our standards is acceptable for --

Councilman Oh

With actual sales?

Mr. Mckeithen

Yeah, we only compare -- that's how we get to placing the assessments is through the sales, so sales are the lifeline of any assessment office valuation. So, we don't just -- you know, we use sales data to arrive at these assessments.

Councilman Oh

Mr. President, can I have a couple of more minutes to finish my question?

Council President Clarke

Couple more 111 --

Councilman Oh

Minutes to finish my question. As in two.

Council President Clarke

As in two. Okay, sir.

Councilman Oh

I want to state this clearly. Philadelphia became known as a city that was undervalued in property, and there was a lot of property being bought and a lot of investors from outside of Philadelphia came in and there was a lot of buying and selling buying and selling of property. Values in many neighborhoods that have working class or below working class level people, lower middle class and whatnot, their property value started to increase. And before those houses could start to decrease in the sales process to get past the bubble, we had this very big recession, nobody was buying houses. That's the history. So, once you're done evaluating these houses, wherever they are, what you're saying is these are not theoretical sales values, that these are the actual sales that are going to incur in 112 these -- these are the numbers.

Mr. Mckeithen

Yes. We look at properties that have sold -- just to give a little bit of background, this might help. We look at properties that have sold that are arm's length transactions. We look at who bought the property, some of the conditions of sale, things of that nature, so we can define what a typical sale would be for a typical home buyer and a typical seller. And, so, based on a lot of that criteria, then we code the sales and we look at properties that have sold versus the actual properties in the portfolio in the neighborhood.

Councilman Oh

Okay. Thank you very much. Thank you.

Council President Clarke

Thank you, Councilman. The Chair recognizes Council Member Squilla.

Councilman Squilla

Thank you, Mr. President. 113 I am not going to rehash the part about the time frame because obviously we don't know when it's going to get done and we'll have the same answers to the same questions, but as far as the purchase of services, I know in Class 200 there seems like there's an increase. What are the amounts being spent for the purchase of services?

Mr. Mckeithen

We'll get that for you. We have $1,425,748 for services. And some of the contracts -- the contracts total up to $1,310,148.

Councilman Squilla

Where are the contracts for?

Mr. Mckeithen

Well, they're for consultants, industry leaders like Dr. Bob Gloudemans is one of the people who we consult with. He is the expert in modeling. He does modeling for localities all throughout the country, writes books and things like that. He is one of the top people in our industry that does mass appraisal modeling. In the past we've have used Dr. Gillan. He does a lot of 114 work us with land valuation and things like that. Bernie Camins, who is an MAI appraiser, who is renowned throughout the state does our training, you know, for our CPE licenses with our evaluators. Those are some of the more key contracts that we have.

Councilman Squilla

All right. So, they're the contracted out services that you're using to get this job done?

Mr. Mckeithen

Right.

Councilman Squilla

And then all of your evaluators have CPEs?

Mr. Mckeithen

Not all of them. We're in the process now, and I'll let Mr. Piper chime in on this, but we are in the process now of getting all of our evaluators CPEs. We've given them two years upon hire to obtain the CPE credential.

Councilman Squilla

But they're the ones that are out there doing the assessment at this point?

Councilman Squilla

And then now that we know that there are going to be more -- 115 well, the appeal process is going through this year with the Steb increase, and that that also takes away some of their time, so we may not get to the actual deadline, is there any intention to hire more evaluators?

Mr. Mckeithen

Well, we're in the process now, we work with HR constantly. We just asked HR to put out a test for EV-1 again. We just had interviews and hired approximately 16, about EV-1s to come in our office. Now 11 we're looking at bringing in an additional 15 12 bodies in terms of trainees. We're constantly 13 around the clock working with HR to ensure that 14 we get opportunities to hire individuals, so. 15

Councilman Squilla

All right. 16 Because I noticed in the budget plan that it 17 seems like there is a decrease in computer equipment that you have as far as usage. Are these new people coming and not going to be using computers?

Mr. Mckeithen

No. Every individual coming in will have a computer and --

Ms. Daniel

What happened, during fiscal '12 we budgeted for the computers for 116 the complete increase in the staffing, so there was $250,000 that was put in just for the computer budget, just for the increase of staff what we had anticipated, so what we've done is we've arranged to have those computers purchased during fiscal '12 so during fiscal '13 we'll already have the equipment for the new staff.

Councilman Squilla

So, you'll have enough equipment for all the new hirees, so it looks like over 30 new hirees maybe coming.

Ms. Daniel

For the most part. It's actually more than 30. I mean, ultimately it was probably between 60 and 70 evaluators, but the equipment will be in the office for them when they arrive.

Councilman Squilla

Okay. One more question. I notice that in the budget also there's -- how do the people evaluators get around, they have to go out in the field. Do they use their own personal cars or is that something --

Mr. Mckeithen

Yes, they're using 117 their own vehicle. They're using -- a lot of evaluators that work center city will use public transportation, but, yes, right now they're using their own vehicles.

Councilman Squilla

Is there any reimbursement for that?

Mr. Mckeithen

No. 8 From my understanding that was considered several years ago when -- prior to my arrival -- when they looked at the salaries, so.

Councilman Squilla

Okay. Thank you for now. I'll come back.

Council President Clarke

Thank you, Councilman. The Chair recognizes Council Member Brown.

Councilwoman Brown

Good morning.

Mr. Mckeithen

Good morning. How are you.

Councilwoman Brown

We need to go on the record to say, first of all, thank you for visiting with us to sort of set up this big journey that all of us are about to go on. And 118 I have to say I do appreciate that Councilman Green asked to walk us through a day in the life of. My thinking is that what you're about to undertake is a huge example of a case study that could be done by a Fell School or a JFK School of Government Professional and how you manage the public relations of this. And, so, my question to you is has some thought or consideration been given to -- I know you have a strategic plan for the roll out -- but do you have a parallel strategic plan that addresses the PR prep and that aligns itself with the actual roll out so that we can minimize the fear that we know exists city-wide amongst our taxpayers and manage it where seniors are understanding that they are in a place separate from the rest of the world?

Mr. Dubow

Yes, very important point, something we really need to do, and so we're looking at bringing in outside firms to help us communicate the message so people know what's available to them and what this actually might or might not mean to them because there is a 119 lot of fear and we need to do something to try to quill that.

Councilwoman Brown

Do you have any lessons learned or best practices from other cities that have had to undergo this huge undertaking and lessons learned on what not to do as we embark on this?

Mr. Mckeithen

My past experience has demonstrated to me one of the biggest things you can do is constant communication.

Councilwoman Brown

Forgive me, I'm sorry, I was side tracked by my majority leader here, who said do not do it during an election year, that's a lesson learned. But beyond that what else?

Mr. Mckeithen

Constant communication, ergo in my assessment notices I've had brochures designed to put in the assessment notice of things like frequently asked questions, who you call, what this means, things like that. But you can't over assess the fact that the communication and getting out to the community. So far I've done several town hall meetings with State Rep Cherelle 120 Parker as of late. I've done a couple -- my staff has done some meetings, community meetings, I've done several, you can't over emphasize getting out to the public --

Councilwoman Brown

Agreed

Mr. Mckeithen

-- and really getting this message out and letting the public get a feel for who you are.

Councilwoman Brown

Sure.

Mr. Mckeithen

And things like that, and where they can get information and where they can get responses.

Councilwoman Brown

Agreed.

Mr. Mckeithen

That is paramount in this type of an effort.

Councilwoman Brown

Environment. There is an old adage, and I think I shared this with you or someone in a meeting, children have to hear something seven times before it really kicks in. So, we know for something as complicated as this, adults are going to need to hear it seven times more to get their arms around it and accept the reality. 121 The one group I continue to be concerned about, like many of us, are our seniors. So, I ask that a strategy be considered to go to every single senior citizen center in the city and tell the story about what is about to happen and how and if it may or may not impact their world.

Mr. Mckeithen

I think that's a great strategy. I would ask Council Members if you have any town hall meetings or events that you're planning that you feel as though we can help as far as getting that message out, we more than welcome you to invite us. Because, once again, that's where we meet a lot of the seniors, at the town hall meetings as well as the senior facilities, so I think that is a great strategy and we'll look to employ that.

Councilwoman Brown

I am sure there are a number of members that will take you up on that offer as well. I am surprised that hasn't rung, so I need to re-read my questions privately before I say them publically. 122 So, thank you for the important work that you're doing.

Mr. Mckeithen

Thank you.

Council President Clarke

Thank you, Councilwoman. The Chair recognizes Council Member Green. We'll come back to him when he comes back in. Chair now recognizes Council Member Kenney.

Councilman Kenney

Thank you, Mr. President. Let me give you a scenario that I have concern about relative to your folks working the field. If you're in a neighborhood that is gentrified or gentrifying, and the values are changing and younger people are moving in and putting money into their property and 75 to 80 percent of the houses on a particular street are purchased relatively recently at a higher inflated price or a higher price than what was used to in the neighborhood and they put a lot 123 of money into the property, and in the middle of the block you have a person who has lived in that house probably for four or five generations, probably paid $10,000 for the house, their grandmother paid $10,000 for the house, but they happen to be on a street, happy to see the street improving and the property values going up, but how do you reconcile the increase value of that particular generational family-owned property with properties of -- for want of a better word -- yuppies who are coming in, and we welcome them, it's terrific they're coming in, many of them potentially are getting some sort of tax abatement, and now you have this generational family that is going to potentially experience a major increase in their assessment and a major increase in property tax? How do we handle those folks?

Mr. Mckeithen

Okay. What the Councilman just described was a prime example, a great example, of a neighborhood life cycle where a neighborhood goes from being somewhat dormant to stable to moving in a matter of 124 increase in values. What you typically will see is that even the most docile or even the most typical house or below average condition house, value will go up because new individuals are coming in buying these properties at higher prices. Well, the assessor is bound by the sale prices and the data and the assessor will not see who lives in what, he is going to value the property based on what it would sell for. When the values are laid out and disbursed to the taxpayers, the value for an average house will be at one rate and a value for a house that has been fixed up that we can tell the permits and all things taken will be at another rate, but I can tell you from experience that even in a neighborhood where the life cycle is evolving, even the most basic house will now sell for a price that is much higher than what it used to sell for and helping that senior or the individual who has been there for years stay in that property will be something that Mr. Dubow's team will work on. 125

Councilman Kenney

See, part of the issue is going to be in certain areas of the city where there are high property values already, the difference may not be that much because they've probably been reassessed at some point in time at a higher rate, it's those neighborhoods that are primarily blue collar that are experiencing this uptake in property value because of the desirability of living in the city, and that's a terrific thing, we want it, however, those people are going to be to sticker shock folks.

Councilman Kenney

And guess what, they don't really care about -- they care about the value of the property, but they're not in any intention of selling it any time soon other than passing it along to their kids. So, there's a -- it's not -- I don't think we can just go with comparables or just go with what we think the value of the property is in every single instance because we're going to really hurt some folks who have not moved out of the city, not moved to southern New Jersey, 126 Delaware County, and whose neighborhoods have been okay or struggling or marginal for a long time, and now because of the factors of center city kind of getting too crowded, people are moving north, moving south, moving west, and they're going to get this bill in the mail that's going to knock them off their kitchen chair and we have to be ready for that. I don't want to chase folks out of town because certain neighborhoods are doing better than they did in the past years. 12 So, I mean, is there any consideration 13 of that fact? 14

Mr. Mckeithen

Not by the assessor. 15 The assessor is going to value their house 16 irrespective who lives there, he's going to 17 value it for what it would sell for. Mr. Dubow 18 will -- 19

Councilman Kenney

We don't look at 20 anything inside? So, if I have a house that I am living in, I haven't done anything to the property, I have a 1960s kitchen and paneling on the wall and I haven't done any renovation, that property is the same value as the guy next 127 door who could be a young professional couple?

Mr. Mckeithen

No. That property will be based on its condition, but when you have neighborhoods that are evolving, some of the younger yuppy individuals that you've described will buy the most basic house, almost literally in shell condition for a value because they just want to get in, and that's how neighborhoods increase in desirability and increase in valuation.

Councilman Kenney

Just finally, and if I can just for a second because I usually don't go over time, Mr. Dubow, we passed -- Commonwealth passed property tax relief for long-term residents back in the '80s. It was a Constitutional Amendment to the State Constitution allowing cities of the first class to give property tax relief to long-term residents in gentrifying areas. How do you intend, if you intend, to use that State Constitution provision to soften the blow for a lot of these folks?

Mr. Dubow

So, right now actually we don't have something in our proposal. We have 128 the two issues we talked about, the Homestead exemption and the smoothing, but we're happy to talk about other possibilities that would help with the issues that you're bringing up.

Councilman Kenney

Okay. We'll be back. Thank you.

Council President Clarke

Thank you. Chair recognizes Council Member Henon.

Councilman Henon

Mr. President, I would say the other day we had in here for testimony I believe it was the mayor's Commission on Aging and we were getting some statistics and a snapshot of all the programs and assistance that the office and guidance that they provide to our seniors, long-term residents in the City of Philadelphia. And one of the things that I got out of it that was -- that caught my eye was that 60 percent of those seniors who use either the resources or were asked for some guidance and advice for some direction, 60 percent of them were property owners. And I see in, whether it's the testimony or the five-year plan or somewhere in 129 the budget report, that only a little over 13,000 of our seniors take advantage of freezing, you know, their tax rates at its current level. So, my question is they are the numbers that were dealt with. Now, that's only 60 percent of property owners of I don't know what aggregate of our seniors throughout the City of Philadelphia, I have a large amount of senior citizens that, you know, I mean, we all represent, you know, in the City. So, I mean, we have an older city, you know, maybe some younger folks are starting to move in and gentrifying the areas, which is fantastic and I hope it continues on that trend, you know, but we do have some longevity here in the city. But if you take that trend for those who were just asking for assistance in one form or fashion, the 60 percent number, I would imagine it's going to be comparable for those who don't take advantage of the freezes in the 13,000. Would you be able to explain maybe how we can better outreach to the longer residents 130 here and the seniors because only a small portion of the seniors are taking advantage of the freeze, but a large portion of those are taking advantage of -- which is a small part of the whole -- are taking advantage of the assistance for property owners.

Mr. Dubow

So, we agree that we need to do a better job of outreach, particularly with the changes that will come with AVI. And I think this goes back to Councilwoman Brown brought up before, we'll bring in outside firms to help us design a strategy to communicate better so that people know what's out there and we see more people take advantage of it.

Councilman Henon

All right. Let's just say over the course of last year, you know, visiting many senior groups, you don't have, that only represents a little part of the population, the senior population, that you can actually touch and reach, so I would hope there would be a more comprehensive plan moving forward on outreach. And, you know, I am glad to hear that you're out there to start, but I think we could do a better plan of reaching 131 seniors just to inform them and let them know, you know, what is already available and that they should take advantage of.

Mr. Dubow

Right. And that has to be kind of two parts. One is, you know, Mr. McKeithen going out and explaining what is going on, but then we need kind of more wide spread information, whether it's through mailings or how ever, to make sure that we've reached a broad audience.

Councilman Henon

Right. And to follow-up while you're up here, Mr. Dubow, the request was made, I think you had said for different Bellwethers, you know, samplings of neighborhoods.

Councilman Henon

Would you be able to add to that set of data, you know, when ever you provide it, the increase or decrease of the snapshot assessments in the neighborhoods, whether this way you can give us a bird's eye view of whether a neighborhood is either increasing in its assessments or has decreased in the trending of the hundred percent 132 property.

Mr. Dubow

What we can show you is the difference between where market values are now and where average sale prices are and that will give you a sense of what might happen.

Councilman Henon

I mean, and I'm not asking for specifics.

Mr. Dubow

And it might not be exactly where assessments go, that might be --

Councilman Henon

And I am not asking for exact assessments. Just so we know that, hey, look, here is a neighborhood here who has been either gentrified or, you know, has been on an upswing, or, you know, in turn has been negatively effected so we could show where we stand on that.

Councilman Henon

And last question is when we're assessing the properties, you have the Office of Property Data, which is, and many other departments are collecting data across the city, is the assessors while they're out there going to coordinate with them as we move forward so you get a real assessment of 133 the city owned properties, whether it's commercial, residential, and I had one other category, commercial, residential usually covers it, or vacant lots?

Mr. Dubow

Yes. So, the two offices are working closely together. So, yes, when the assessment process is done, the Office of Property data will have that information. So, yes, the answer to your question is yes.

Councilman Henon

Great. I have no 11 further questions. Thank you.

Council President Clarke

Thank you, Councilman. The Chair recognizes Council Member Greenlee.

Councilman Greenlee

Previous Council Members touched on a lot of what I was going to ask, but just sort of as a follow-up to what Councilman Kenney was talking about, what you used to determine, the surveys that you gave that were given out, that were stuck in doors or --

Mr. Mckeithen

The door hangers? 134

Councilman Greenlee

Yes, door hangers, that's it. What kind of success did you have in receiving answers on that? I know I heard from some people they were afraid to give me information.

Mr. Mckeithen

Yeah, the door hangers were a hit as far as some innovative practice that we put into our office. We haven't finished yet sending them all out. I think we sent out about 30,000, yeah, about 30,000, we ordered about 30,000 and I am down to my last box in my office right now. So, our IT director is going to go through a process where we actually scan and things like that and so we'll have some numbers on what came back in.

Councilman Greenlee

So, you're still getting out those door hangers?

Mr. Mckeithen

Yeah, they're coming back, my office is full of them. I have several stacks.

Councilman Greenlee

Any percentage of how many people you think so far of the ones you have given out that have responded roughly? 135 Do you have any idea? I am just wondering

Mr. Mckeithen

I would say better than five percent, better than seven percent. I mean, just off of what I see visually.

Councilman Greenlee

Seven percent responded?

Mr. Mckeithen

Now, we haven't counted anything so I won't be able to verify that until later.

Councilman Greenlee

Is that, by the way, I saw something in the budget about $10,000 for surveillance money, is that what that is, the survey?

Mr. Mckeithen

No. 15 I'll let Ms. Daniel tell you what the surveillance is.

Ms. Daniel

That $10,000 is for occasionally the inspector general would do surveillance because we have people who work out in the field and, you know, we do hold employees accountable for the work. So, occasionally the in spector general will go out and do surveillance and when they do that the departments pay. 136

Councilman Greenlee

So, you have to pay the inspector generals --

Ms. Daniel

Yes, we do.

Councilman Greenlee

-- to check on you, huh?

Ms. Daniel

Yes, we do.

Councilman Greenlee

Okay. So, a lot of departments have that I wonder?

Ms. Daniel

The departments pay those contracts. The contracts belong to the inspector general, but we pay them.

Councilman Greenlee

All right. Okay. And just add in, this is just a statement just to add to what Councilman Kenney said, and I think he put it very well, but I think the people that I'm really worried about in these areas that he's talking about, we might be able to find programs for seniors or maybe low income people, but there's that regular sort of working class person that has been caught up in this and they're the ones that I think we really have to be, and I guess I'm directing this more to Mr. Dubow, I think they're the ones we really have to be concerned 137 about, you know, that they might not fit into a program per se, but, you know, they may have inherited that house, as Councilman Kenney said, maybe they're only 45, 50 years old or something, you know. I know a few of them myself, so, you know, so I just throw that out there I guess, I don't know if you have a comment on that, but that's the thing that I keep thinking about in all these neighborhoods, almost every one in the First Councilmanic District, for example, has that kind of person in there.

Mr. Dubow

Right. I think we understand that's an issue. Other than smoothing, we don't have an idea for kind of a mass system, but, again, I mean, if there is an idea, we're open to it.

Councilman Greenlee

No, I hear you. See, I thought you were going to give me a brilliant idea. No, I am only kidding.

Mr. Dubow

I didn't hear what you said.

Councilman Greenlee

I thought you were going to give me a brilliant idea. No, 138 I'm only kidding, but it's just a concern out there that I think a lot of us have that we know a lot of those kind of people that are kind of in the middle somewhere, so.

Mr. Dubow

Yeah, yeah.

Councilman Greenlee

Okay. Thank you, Mr. President.

Council President Clarke

Thank you, Councilman. The Chair recognizes Councilman Jones.

Councilman Jones

Thank you, Council President. I appreciate it.

Council President Clarke

You're welcome.

Councilman Jones

I think Councilman Henon touched on this a little bit, but I would like to speak about it a little bit. The amount of city-owned real estate in various conditions, whether it's a lot, whether it's a vacant property, whether it's something we acquired in sheriff's sale, about a half dozen entities, whether we're talking about the Redevelopment Authority, the Philadelphia Housing Development Corporation, 139 public property that owned these properties, so this assessment is going to be applied to them. What is the current assessment of all government-owned not municipal buildings, but acquired properties through various acquisition projects or processes like sheriff sales? What is our guesstimate as to what that real estate is worth?

Mr. Mckeithen

See, we'd have to run a report to get that. We have reports on what our basic city-owned property is, but we could ask for a report.

Councilman Jones

So, define city-owned property. Are you talking about municipal buildings?

Mr. Mckeithen

Municipal buildings, schools, things like that, office buildings, warehouses.

Councilman Jones

When you gather your data, I would like a particular pool, if you could provide to members of Council, that shows all of the acquired sheriff sale, PHDC, RDA properties that are in some form of ownership yet limbo, again, that speaks to what 140 the development potential is for those properties. So, if we own 200 properties in the 9th Councilmanic District that are owned by PHA and they're vacant, if we own another 80 properties that might be in various forms of ownership such as public property or redevelopment, what is that worth, so that as we start to look at developers that may be interested in our District, particularly in my District, we lost population, and so now we have vacant properties that could be developed to attract residents back to there. So, again, I speak to the Councilman's development district idea that if we can get a sense of what they're worth, if we can get an accurate picture of where they are and where they're owned, we can market these properties to people who want to build something. So, that data is very much important to us to see what the true value of those things are.

Mr. Mckeithen

No problem, sir.

Councilman Jones

Thank you, Mr. President.

Council President Clarke

Thank you. 141 Mr. McKeithen, I want to follow-up to a question I had earlier with respect to the process and you talked about the current process coming up with the characters, the characterization of properties, and the character of properties and I tried to get you to commit to a little bit more. How difficult, because we had a briefing from the Administration and they talked about a scenario, I think they talked about a $30,000 house and a $100,000 house, and I know that wasn't your side of the process, that was Mr. Dubow's side, and I understand, I'm kind of getting a sense from a policy perspective, you're trying to stay as far as away from that, you're simply trying to be the numbers guy, so I guess I'm asking both of you all, how difficult would it be to, since you were able to come up with a 30 and a 100,000, how difficult would it be for you to come up with a list of properties in increments of $10,000 up to $400,000.

Mr. Mckeithen

Of assessed value?

Council President Clarke

Coming up 142 with scenarios based on what we received -- and maybe I shouldn't be asking you this question -- coming up with scenarios of properties starting at 10, and you can start at 20, maybe nothing is at anymore, but in 6 increments of ten, 20,000, 30,000, 40, 50 and 7 based on the characteristics, or those 8 particular neighborhoods where you have done 9 some work as it relates to having actual feet 10 on the ground, up to $400,000.

Mr. Dubow

I am not sure what you're asking for us to do with those various properties.

Council President Clarke

You gave us a briefing, right?

Council President Clarke

And you talked about two properties, examples.

Mr. Dubow

It was what a Homestead exemption would mean for each of them.

Council President Clarke

Right. So, are you telling me that you can't also tell me what, based on the information, you can't tell me what the possibilities would be if you 143 applied the actual values and snapshots? I mean, aren't you that far along where you have a sense of in those particular neighborhoods? Basically, what I'm asking you to do, since you can't, and I understand I guess from Mr. McKeithen's perspective, he wants to get all of the information and just give it to us in some level of completion. I guess what I am asking you, can you give us snapshots in 10, 20,000 dollar increments up to $400,000? I mean, I got to believe you can do that. I just can't believe we're not in a position based on having actual value applied to properties, because you are doing assessments, you have been doing assessments in some areas of the city, just give me examples of properties.

Mr. Dubow

And what will happen to their assessments you mean?

Council President Clarke

Exactly.

Mr. Dubow

Well, not what would happen to their taxes, but what would happen to their assessments?

Council President Clarke

Both. 144

Mr. Dubow

We won't know what will happen to taxes until we have all the assessments done and we know how much we're going to have to -- we won't know --

Council President Clarke

Why can't you? I don't understand that. You can't do snapshots --

Mr. Dubow

We can give you -- we can give you different tax rates and what it would mean, but we won't know what the tax rate is to put against it. So, we can tell you different values, but because we only have -- and if I understand what OPA has done, they've gathered data on 75 percent of the houses, they haven't put values on them yet, so we have to finish the values first --

Council President Clarke

For the entire city, you can't pull out -- I mean, I'm not a cynical person, but it almost seems like you're doing it in a way that you're going to ensure that you won't have any information for us until you get to the end of the process, which happens to be beyond the budget. 145

Mr. Dubow

Right, and that's not what's happening. I think what OPA is doing is a process of how they would always do a full assessment.

Mr. Mckeithen

Procedurally, the way the process works, is that you have to collect all of the data first and then you need to vet it to make sure it's clean and make sure it's as accurate as possible, because if you don't then you're going to get -- it's that old bad information in, bad information out. We're just at a point, when I say 75 percent, we have inspected over 75 percent of the residential parcels to get well it has a garage. We haven't tied to that what that garage value means to that property in that neighborhood yet.

Council President Clarke

Why can't you do that?

Mr. Mckeithen

Because we have to have, one, the model set up yet and we have to use neighborhoods where all the data has been collected and data entered. See, we don't have -- 146

Council President Clarke

Why?

Mr. Mckeithen

Because if it's not entered into the system while we have it, it doesn't count until we enter it into the system because the model is going to run against the system to get a variable factor for what that garage would mean as far as money, as far as assessments, and so we can't do -- put one step in front of the previous one because it wouldn't gain us anything. We have a report that Councilman Green has asked for that was prepared on the 75 percent and we took two GMAs to show the data, which is all like whether the property's in average condition, whether it has a garage, whether it is boarded up, but what does that boarded up property, what would that sell for, that step isn't ready. We haven't even calibrated the model yet to do that, and that's what we will be doing in between late April and May and then running the models and then seeing what spits out, but we still got some cleaning up and stuff to do and some collection to do. I cannot emphasize that enough. 147 One day, and I know this doesn't help you all today, but technologically when we have things like tablets where we don't have to do the actual physical data entry, because right now we're all on paper, where we have tablets and things that we can go out in the field and record information that loads right up and I don't need a body to sit there and type it in, then we can work at a much more efficient pace, but right now we are nowhere close to that, not at OPA.

Council President Clarke

Okay.

Mr. Mckeithen

Sorry.

Council President Clarke

I'm saying okay because you're not going to give me more than that, but not because that's an answer that I am really comfortable with, but okay. Chair recognizes Council Member Green. I certainly defer to Councilwoman Tasco, Mr. President.

Council President Clarke

Thank you, sir. Councilwoman Tasco.

Councilwoman Tasco

I couldn't get 148 here earlier, so I missed a number of rounds, and I only have probably one question. When we were at Councilman Kenyatta Johnson's town meeting a number of residents from the Eastwick area raised the issue of flooding, and some areas of my district, well now former district, in the Logan sinking home area, we don't have any properties there, but maybe in, it could, we don't know, have further subsidence. When you are assessing the problems, what do you take into account, and maybe you don't know there has been a subsidence issue or a flooding issue in assessing the value of a property, does that come into play?

Mr. Mckeithen

Yes, the answer to that is yes. And also the answer to your assumption is true also. We can only take into account things we know about. This is a mass appraisal process, and so a lot of things we won't find out until after taxpayers notify us, like houses having flooding issues, houses having interior walls that are moving and things like that. That's where we make 149 adjustments. That's why I'm imputing a first level appeal process in the Office of Property Assessment for the first time ever because you should be able to call us once you get a notice and say, you know, I don't think you took this into account, you know, can you come down here so I can show you. And we actually go down to your property and you can point that out and then we can try to tie some value to it. Things that we know about, things that you guys let us know about are awesome because we can try to take it into account before we send out notices or when we're doing analysis. But if information doesn't come to us through the sales of, you know, we don't get information on this property sold for this low amount because of its flooding and things like that, then there is no way we could account for it before the notices are sent out. That's why it's absolutely, absolutely, absolutely vital that taxpayers once they get their notice understand that we have a first level process that you don't have to come down and sit before a panel, you don't have to have a formal 150 hearing that's tape-recorded, you can come down and talk with us and show us, you know, at your property things that we might need to make adjustments on.

Councilwoman Tasco

That was my question. The other thing I just want to say to you, Mr. McKeithen, is thank you for coming out Saturday to our town meeting that State Representative Cherelle Parker had. It was very important to those residents and I am sorry I couldn't stay, but thank you for coming out.

Mr. Mckeithen

I had a great time. Once again, I love coming out and meeting with the taxpayers face to face.

Councilwoman Tasco

All right. Thank you.

Council President Clarke

Thank you, Councilwoman. Councilman Green.

Councilman Green

Thank you. We're back into the life of an evaluator, or assessor, who has sat down at 151 their terminal and working on their GMA and you were telling me what that meant. And what is it that they are doing? Have they been assigned a path through their GMA by somebody and they're working on that? Are they doing data entry on what they did the day before and that's really all they're doing in their GMA, going out, collecting data on the form and entering it in the computer? Exactly what is it?

Mr. Mckeithen

Okay. I gave a primary example of we were talking about a residential, I didn't even touch on a commercial one, but residentially speaking, after they have entered in the information or while they're entering in the information they are recording all types of things that they have discovered in the field, like there might be an addition to a property that we never had on the books.

Councilman Green

So, this is all on the form that they filled out while they were in the field, the property data form you mentioned earlier? 152

Mr. Mckeithen

The property data form will have information that they have recorded. If they see additional things, that might just be in their notes. They have notepads as well as property data forms, so.

Councilman Green

So, all information related to a property goes on two separate pieces of paper and it's not found in one place?

Mr. Mckeithen

It goes on several pieces of paper, whatever they have with them, which mainly is they're binder, but, yes, they will record it in any method that they have. They have pads, they have a whole number of things, and so they will record whether that property has an addition. They'll measure it or sketch it and things like that and then you have to put that addition on the books.

Councilman Green

That's what they've done in the field. So, they're now --

Mr. Mckeithen

No, we back at the office now.

Councilman Green

They're now at the terminal. 153

Mr. Mckeithen

We're back at the office, okay. So, they're picking up this addition, so they have to fill out a money sheet, they have to put in a money sheet to make sure that we have accurately recorded that addition and put it on the books so it can be taxed.

Councilman Green

What's a money sheet mean?

Mr. Piper

Good afternoon, Councilman.

Councilman Green

Good afternoon.

Mr. Piper

A money sheet and what Mr. McKeithen is referring to is a form in which the data is actually put into the database.

Councilman Green

So, the money sheet is not another piece of paper, it is the entry of the data that's on the property data form that was in the field and on the binders or notebooks that were in the field, we're now doing data entry.

Mr. Piper

Someone will do the data entry, correct. 154

Councilman Green

It's not the evaluator?

Mr. Piper

Not necessarily.

Councilman Green

So, the evaluator is coming back and taking the data they have from the field and it is on the property data form, it's written in the binder they had with them for that block or the area they were covering, and it's --

Mr. Mckeithen

Or on a pad or something.

Councilman Green

Thank you. And it's potentially on a pad also, and they fill out a new piece of paper when they get back into the office called the money sheet.

Mr. Mckeithen

For an addition, right, for an addition or something of that nature.

Councilman Green

And then someone takes that money sheet and does the data entry. So, the evaluator is not doing the data entry of what was discovered in the field at all?

Mr. Mckeithen

No. See, the evaluator is going to enter in the information 155 for what they saw with that edition. Someone else is going to enter in the numbers from the money sheet because you have to apply value to what you saw in addition to what is there. And, so, someone else will enter in that the addition -- we're picking up "X" amount of money for this addition and it goes into another system.

Councilman Green

It goes into an another system?

Councilman Green

So, what's the other -- well, before we get to the other system. What is the system that the evaluator today is putting his or her data in?

Mr. Mckeithen

It's called Characteristics. It's a part of our VSAM module.

Councilman Green

And so primarily evaluators today, and for the last couple of years, haven't actually been assessing properties, they've been gathering data and inputting that data into Characteristics?

Mr. Mckeithen

Ever since my arrival, 156 they have been entering data that they have discovered in the field into Characteristics so we can make sure it's recorded. Prior to my arrival, I don't know where they were putting the information.

Councilman Green

Thank you, Mr. Chair. I have more questions, but I don't know if anybody's --

Council President Clarke

Thank you, Councilman. We'll come back to you. The Chair recognizes Councilwoman Bass.

Councilwoman Bass

Thank you, Mr. Chair. Hello, how are you?

Mr. Mckeithen

How you doing? Good afternoon.

Councilwoman Bass

I'm well. I just have a couple of questions, I think everything has pretty much been covered, but I do want to start by saying I think it's, just in my own opinion, I think it's a little bit troubling and scary that we're undertaking such a huge 157 process and we don't have the technology or the tools of today. We don't, you know, send folks out with, you know, notebooks or Ipads or PDAs or anything, you know, they got a note pad, and, you know, that's just a little bit, in my opinion, a little bit disconcerting that we would undertake such a huge effort of something that's so important and vital to the life of the City and really not have the tools, and so it's not, you know, I know it's not your fault, I am sure that you would have the tools, you know, if you could get them, you know, but I just thought that was something that was just a little bit troubling to me. Just a couple of questions. You mentioned that five to seven percent was the rate of return on the door knockers about?

Mr. Mckeithen

I believe, roughly. I won't know for sure until I have my IT person actually scan everything and get into a database.

Councilwoman Bass

Okay. And was that what was expected, what was the expected rate of return? Do you know what the average 158 is in cases like this in other cities that have done this sort of thing.

Mr. Mckeithen

Well, from my perspective, and once again it could be more than five percent, it's coming more than what I thought it might come in. I mean, I don't mean to be precarious or anything, but, you know, it has done better than I was initially told because I was initially told that they would all be thrown in the street and nobody would send it back.

Councilwoman Bass

So, you didn't expect anything back?

Mr. Mckeithen

I did, but some of my colleagues didn't.

Councilwoman Bass

So, we didn't have a particular goal of what we hoped the rate of return would be on these items?

Mr. Mckeithen

I hoped the rate of return would be at least seven to ten percent.

Councilwoman Bass

So, seven to ten was the goal?

Mr. Mckeithen

I hope, right.

Councilwoman Bass

Okay. And so it's 159 a little bit lesser.

Mr. Mckeithen

But I had to temper that based on what I was told from my colleagues, so.

Councilwoman Bass

Okay.

Mr. Mckeithen

In the assessment world -- if I may.

Councilwoman Bass

Sure.

Mr. Mckeithen

Any information that you get is vital and of use, so without year one tying a specific goal to something saying if it was a failure or not, because we have never done anything like this, I thought that us getting them back and getting information, some of the information would get back and I thought it was rather good.