1 / 39

Maximizing Tax Revenues with Digital Parcel Maps

Discover the potential of a parcel-polygon spatial database in increasing property and sales tax revenues. Learn about the advantages of accurate and available digital parcel map data.

kdelapaz
Download Presentation

Maximizing Tax Revenues with Digital Parcel Maps

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Potential of a Parcel-polygon Spatial Database to Increase Property and Sales Tax Revenues • Tract H: Communications & Professional Development • Session: Business Process Change & Technology • Date: Wednesday, September 1, 2004 • Time: 1:30pm - 3:00pmLocation: Salons A&B • PRESENTED EARLIER AT • IAAO URISA GIS in CAMA: Austin, TX, March 31, 2004URISA Conference: Atlanta, GA October 15, 2003CALGIS 2003: Palm Springs, CA March 27, 2003 • Dennis H. Klein, AICP PE • Boundary Solutions, Inc. • Mill Valley, California • September 1, 2004

  2. OUTLINE…. -   THE THREE As – Digital Parcel Map Accuracy, Availability and Advantages. -      DATA SHARING Policy Survey. - TAX REVENUE ADVANTAGES OF BROAD USE of Digital Parcel Map Data.

  3. BACKGROUND • - GIS Location Platform - - National Street Centerline since 1980 DIME File. • Address ranges based. • Addresses displayed as latitude / longitude points. • Big breakthrough but ERROR PRONE. • Parcel Boundaries instead of Address Points. • What’s inside a parcel boundary is at an addressvs. around a point in or near a parcel. • What’s at an address is inside its parcel’s boundary.

  4. Vs. PARCEL BOUNDARIES 347 Hazel Ave. Maporama 347 Hazel Avenue Mill Valley, CA MapQuest Map Point 450’ Error Digital Parcel Boundary Map 347 Hazel Avenue Accuracy ADDRESS POINTS

  5. Accuracy • Superior representation of location is not a remedy unless boundaries are accurate. • Much content produced in the last five years is highly accurate. • Latest GPS, survey control, image rectification technology. • - Over 85% is within 4-6 ft.

  6. Accuracy Percent Parcel by Accuracy Category (60 Million Parcels) (Source: NPDP MetaData Database Records)

  7. Availability - Distributed across over 3000 county / township jurisdictions. - Of the 120 Million Parcels in the USA, over 75 Million are now digitized.

  8. Total Digital Parcel growth Is nosing over as all large counties finish their maps. Total Finished Map growth is nosing up as many smaller counties complete their maps. Availability Growth By Millions of Parcels

  9. Availability - - Projected PROJECTED COVERAGE: 2010 – Assumes all counties > 20,000 Population have a map. Total Counties: 1850 (Total Population 260 Million) Total Parcels: 105 Million(Assumes 2.42 persons/parcel) Includes several Jurisdictions under 20,000 that have or will soon have a finished map.

  10. DATA SHARING POLICIES ENTIRE JURISDICTION DATABAE PRICE – SAMPLE: 566 JURISDICTIONS (Source: NPDP MetaData Database Records)

  11. DATA SHARING POLICIES $/PARCEL PRICE – SAMPLE: 566 JURISDICTIONS (Source: NPDP MetaData Database Records)

  12. DATA SHARING POLICIES $/PARCEL PRICE – SAMPLE: 67,000,000 Parcels (Source: NPDP MetaData Database Records)

  13. DATA SHARING POLICIES • INVISIBLE PARCELS are due to insistence on COST-RECOVERY pricing. • As more jurisdictions become PUBLIC RECORDS COMPLIANT (Duplication Pricing) • COST RECOVERY pricing results in a DOUBLE PROBLEM… • - Little Data being sold -> Low Data Sales Revenue. • Little Data being sold -> Low use precludes MAJOR tax revenue increases from broad use. But How Does Broad Use of Digital Parcel Map Databases Increase Tax Revenues?

  14. FIVE WAYS BROAD USE OF DIGITAL PARCEL MAP DATE INCREASES TAX REVENUES. • -     Optimized More Accurate Real Estate Transactions. • Reduced Insurance Premiums Prices. • Lower Cost Infrastructure Operations. • - Long Term Improved Built Environment. • - Increased Attraction of Major Economic Development Projects.

  15. PUBLIC INTEREST BENEFITSOptimized More Accurate Real Estate Transactions • - Flood and other natural hazard Certification service company operations… • - Certification determination done by buffering a point on a street map. • - According to US Postal Service database (4 digit Zip Code extension). • - Highly accurate when all properties along a street have uniform frontage. • - Because this is often not the case…. 10% - 20% can fall outside parcel…. • - Uneven property frontage.- Flag lots and unnamed alleyways.- Irregular shaped lots.- Non-compliant address assignments.

  16. PARCEL BOUNDARY CORRECT ADDRESS POINT ADDRESS POINT ADDRESS FINDING FINDING FINDINGCOMMENT 117 New Street NO NO YES Over Reporting 312 Lake Street YES YES 117 New Street 312 Lake Street x x PUBLIC INTEREST BENEFITSOptimized More Accurate Real Estate Industry Operations NO Under Reporting HAZARDOUS CONDITION

  17. PUBLIC INTEREST BENEFITSOptimized More Accurate Real Estate Industry Operations Since exact limit of flood and other natural hazard zones is uncertain…. 50’ + buffering is a typical practice. 98% of all government sponsored digital parcel map data within 40 ft. Therefore…. Parcel layer has become a viable location platform for Natural Hazard Certification Determination. Also, ARGUABLY… More accurate and efficient real estate/financial operation will result over time in increased property values and, hence, property tax revenues.

  18. For Example…Optimized Real Estate Operations Induced Tax Increase JURISDICTION Monterey County, CA Dallas County, TX, OH Parcel Count 111,489 820,000 Total Assessed Value $34,700,000,000 $163,000,000,000 Increased Real Estate Property Values 1% 1% Property Tax Rate %1.10 %2.4 POTENTIAL TOTAL INCREASED REVENUES $3,539,400 $39,168,000 BUT THIS is possible ONLY IF digital data is priced LOW ENOUGH for BROAD USE.

  19. PUBLIC INTEREST BENEFITSReduced Insurance Premiums Prices Large insurance companies and all others served by Insurance Service Office (ISO). Rates set by bufferering lat/long address points to determine if property is in … - Wild Fire Zone - Flood Zones - High Crime Zone - Faults, Tsunami, Seismic Zone - Subsidence / Landslide Zone - Which Fire District - Others

  20. PUBLIC INTEREST BENEFITSReduced Insurance Premiums Prices Manual examination impractical. Findings depends exclusively on “machine readings”. Underlying uncertainty is “written off” and ... Passed on to the consumer by being added to the premium price. This accuracy problem is eliminated by replacing Address Points with Parcel Boundaries.

  21. RESULTING MEASUREMENTS Used to Generate Accurate Insurance Ratings P1 P1 P1 P2 P2 P2 P1 P1 P1 P2 P2 P2 PUBLIC INTEREST BENEFITSReduced Insurance Premiums Prices ERROR FREEParcel Based Location PlatformInsurance Premium Rate Processing WILD FIRE FAULTS SEISMIC ZONES CLOSE TO SHORE HIGH CRIME AREAS FIRE DISTRICTS

  22. PUBLIC INTEREST BENEFITSReduced Insurance Premiums Prices Assuming normal market influences, increased accuracy ofparcel boundaries over buffered address points results in up to a 15% reduction in premium prices. Broad use results in data sponsor being subject to major insurance savings. Also, ARGUABLY… - Money not spent on insurance is spent locally, increasing sales tax revenues.- Insurance savings enhances location desirability, real estate values and tax base.

  23. For Example…Lower Insurance Premium Induced Tax Increase JURISDICTION Monterey County, CA Dallas County, TX, OH Parcel Count 111,489 820,000 Total Assessed Value $34,700,000,000 $163,000,000,000 Premium Price / Assessed Value Ratio 1% 1% Greater Accuracy Induced Premium Reduct. 12% 12% Savings Spent on Sales Tax Items 80% 80% Sales Tax Rate 7.25% 8.25% POTENTIAL INCREASED SALES TAX $2,415,000 $12,925,000 BUT THIS is possible ONLY IF digital data is priced LOW ENOUGH for BROAD USE.

  24. PUBLIC INTEREST BENEFITSOptimized Lower Cost Infrastructure Operations. • Private sector utility service areas can cover many counties. • Traditionally, their land bases have been planimetric maps of - Pavement edges. - Other Land Features. • For the first time, many counties in their service areas have completed parcel maps. • Utilities have a growing interest to add an “intelligent” parcel boundary layer.            • - Greater detail to expedite facility planning, design, maintenance and operation. • Improved emergency response from more accurate address location. • Tightened billing by reconciling customer records with corresponding address. -              

  25. PUBLIC INTEREST BENEFITSOptimized Electric/Gas/Telephone Utility Operations • TOGETHER, these benefits yield • Lower operation cost and increased service quality. • Assure competent service without rate increases… • EVEN DECREASES. • ARGUABLY, disposable income not spent on utility bills is spent locally on other stuff • Pumping up Sales Tax. • And making the community a more desirable “location” • Pumping up real estate prices and hence, property tax base. -              

  26. For Example…Lower Utility Bill Induced Tax Revenue Increases JURISDICTION Monterey County, CA Dallas County, TX, OH Parcel Count 111,489 820,000 Total Assessed Value $34,700,000,000 $163,000,000,000 Potential Utility Bill Reduction 5% 5% Average Annual Utility Bill Per Parcel $4,500.00 $5,000.00 Utility Bill Savings Spent on Sale Tax Items 80% 80% Tax Rate 7.25% 8.25% POTENTIAL SALES TAX INCREASE $1,455,000 $12,177,000 BUT THIS is possible ONLY IF digital data is priced LOW ENOUGH for BROAD USE.

  27. PUBLIC INTEREST BENEFITSLong Term Improved Built Environment. All atrocious, hideously incompatible developments have one thing in common. They all received a majority vote at city council / county board of supervisors. How do really bad projects get approved? A long standing political reality - - to get reelected, you have to… “Dance with the one who brung ‘ya.”

  28. PUBLIC INTEREST BENEFITSLong Term Improved Built Environment. When partner is community groups and watchdogs, little chance of bad projects. When main partner are development interests, bad projects will happen. There is nothing wrong with this picture. This balance of power is just the way it is.

  29. PUBLIC INTEREST BENEFITSLong Term Improved Built Environment. Easily available GIS data Databases changes this picture. Best of all, does not challenge the way it is. But tips the process just the same. Typical out-of-time and out-of-money developer rushes about pursuing their interest - - maximizing profits. Far more concerned about having three votes than whether it makes sense. Classic result: wrong use, wrong site, wrong configuration. Spewing out traffic and waste in all the wrong places.

  30. PUBLIC INTEREST BENEFITSLong Term Improved Built Environment. The difference the data makes… Same time required to physically attain a copy of a deed description, same developer can turn on their computers and reference not only the parcel(s) description but… Surrounding use patterns Relative assessed value Relative age Use code / zoning Block level demographic/ economic characteristics Traffic intensity General plan designations Natural and manmade hazards Flora and fauna And more

  31. PUBLIC INTEREST BENEFITSLong Term Improved Built Environment. When spatial data is common enough, it becomes commonly used. Without even meaning to, the same developer decides to: - DO NOTHING - - lure of cheap land offset by early recognition of excessive costs. - Spatially query entire region to find more amenable (profitable) site. - Check for incompatible conditions and configures projected accordingly. - Uses better understanding of neighborhood to optimize use and configuration.

  32. PUBLIC INTEREST BENEFITSLong Term Improved Built Environment. • Ironically, the more spatial data is used, • The more pressure by development community on elected officials for the data to be OK. • The more elected officials make sure GIS department has enough budget get the job done. • AND ARGUABLY, • The more the built environment improves, the more • The community becomes a more desirable “location”. • - Pumping up real estate prices and the tax base.

  33. PUBLIC INTEREST BENEFITSIncreased Attraction of Major Economic Development Projects Rappatoni Corporation is implementing parcel boundary based Multiple Listing Services. FARES just purchased MarketLynx to do the same. About 20 Metros already linked to digital county databases. Subscriber in New York can browse for “dream parcels” where there is coverage.

  34. PUBLIC INTEREST BENEFITSIncreased Attraction of Major Economic Development Projects If your jurisdiction is in one of these systems, you can be seen. When constraint is high (price, restrictive use) the Jurisdiction is “invisible”. How much more is the GIS budget protected when… Recently attracted out-of-state major (even “green”) economic development projects can be cited rather than last year’s data sales revenues.

  35. For Example…Attracted Capital Project Generated Tax Increase JURISDICTION Monterey County, CA Dallas County, TX, OH Parcel Count 111,489 820,000 Total Assessed Value $34,700,000,000 $163,000,000,000 Ratio Additional Capital Projects / Tax Base 1% 1% Potential Increase in Property Tax $347,000,000 1,010,000,000 Property Tax Rate %1.10 %2.4 POTENTIAL TOTAL INCREASED REVENUES $3,530,000 $39,168,000 BUT THIS is possible ONLY IF digital data is priced LOW ENOUGH for BROAD USE.

  36. PUBLIC INTEREST BENEFITS CONCLUSIONTOTAL POTENTIAL INCREASED SALES AND PROPERTY TAX REVENUE FROM BROAD PRIVATE SECTOR DIGITAL PARCEL MAP DATABASES INCREASED TAX REVENUES MONTEREY,CA COLUMBUS, OH OPTIMIZED REAL ESTATE OPERATIONS INDUCED PROPERTY TAX INCREASE $3,539400 $39,168,000 LOWER INSURANCE PREMIUM INDUCED SALES TAX INCREASE $2,415,120 $12,925.440 LOWER UTILITY BILL INDUCED SALES TAX INCREASE $1,455,000 $12,177,000 IMPROVED BUILT ENVIRONMENT QUALITY INDUCED PROPERTY TAX INCREASE $3,539400 $39,168,000 OUT-OF-TOWN FINANCED DEVELOPMENT INDUCED PROPERTY TAX INCREASE $3,539400 $39,168,000 ANNUAL TOTAL INCREASED TAX REVENUE INCREASE $14,488,000 $142,600,000 % TOTAL ASSESSED PROPERTY VALUE (After About 5 years – more further out)%0.042 %0.087 BUT ALL THIS is possible ONLY IF digital Parcel Map data is priced LOW ENOUGH for BROAD USE.

  37. CONCLUSION…. What’s in it for the Assessor? By adding “Data Management” to your appraisal mission, not to make money off the data, but to expedite its BROAD USE, benefits the Assessor in two ways… o Increased Sales Tax Revenues o Increased Property Tax Revenues

  38. CONCLUSION…. This presentation has communicated to you the sources and potential magnitude of future revenue increases induced from BROAD USE of digital parcel map databases. It is up to you to figure out how to direct the portion you need to operate the Assessor’s office in general and the Mapping Division in particular. One thing is for certain, BROAD USE of digital parcel map data is far more interesting than CONSTRAINED USE.

More Related