The assessor’s job is to determine the fair market value of every parcel of property in Juneau, every year. These values directly affect property tax bills and the balance of who pays for city services.
Supporters of the repeal say the mandate is an invasion of privacy and expect it to lead to higher property taxes. Most Assembly members oppose the repeal. They say disclosing sales prices will lead to more fair and accurate assessments, particularly for higher-end properties, which tend to get undervalued when assessed.
Real estate professionals and developers are leading the repeal effort, which began with the citizen petition process. They often point out how common it is for jurisdictions with mandatory disclosure laws to enact real estate transfer taxes that they say add to the cost of housing.
Here’s how the group leading the repeal effort, Protect Juneau Homeowners’ Privacy, boiled it down into a 30-second Facebook video:
That’s Gary Stephens. He runs a car repair shop in Juneau.
Assembly members say the mandate is not about boosting tax revenue.
Mayor Beth Weldon voted against the original mandate, and didn’t want to share how she’ll vote on the repeal question. But she said she was disappointed with some of the messaging from repeal supporters.
“We have never said that we were going to do a transfer tax,” Weldon said. “In fact, we didn’t even know what a transfer tax was until they brought it up. Quite frankly, we’re spending millions, and I mean millions of dollars, on trying to make housing affordable in Juneau. And why would we make housing more expensive in one hand and then spend millions on the other hand to make it cheaper? … It just does not make any sense.”
No Assembly members have taken any steps or indicated that they want to create a real estate transfer tax.
Realtor Kimmi Ott hosts a podcast called “What Juneau About Real Estate?” In a May episode, she said she just doesn’t buy that.
“The city has been saying, too, ‘Oh, no, we’re never going to implement a transfer tax,’” she said. “I am calling bulls— because you guys have not kept your word. You changed the game on everyone!”
She was referring to the update the Assembly made in February to the disclosure mandate. At first, the information had to be kept confidential. But after property owners fighting their assessments demanded more transparency, the Assembly ditched confidentiality.
The February update also added the possibility of fines for failing to disclose. Juneau Assessor Mary Hammond said Wednesday that so far, no one has been fined for this.
The main argument from supporters of real estate disclosure is more nuanced. During a forum last week, Assembly member and unopposed candidate Carole Triem said she’s voting against the repeal and wants to keep the mandate in place.
“I think there’s a lot of misinformation out there,” she said. “Mandatory disclosure will help lower the property taxes of middle- and low-income homeowners, because we’ll even that out with the higher income properties that don’t come on the market quite as frequently.”
Let’s unpack that. Why would mandatory disclosures lead to lower property tax bills for middle- and low-income property owners? And why aren’t higher income property owners already “evened out?”
Without the mandate, the assessor’s office already had a lot of publicly available market information for common types of real estate sales, like for tract homes. The more market data it has, the more confident it is about its assessments being accurate and fair.
But for extraordinary properties, say for custom homes or commercial buildings, the market is much smaller, sales are less frequent, and they tend to be more private. So the assessor’s office has to make more guesses about Juneau’s most valuable properties.
The city finance director has said in a memo that the assessor’s office tends to under value properties they have limited information about. The Alaska Legislature’s nonpartisan research service examined the issue in 2014, and its researcher came to the same conclusion on a statewide level.
Basically, Triem thinks the mandate will raise assessments of Juneau’s most expensive, but generally under-assessed properties, and have little effect on the assessments of more common properties.
“Having that information out there in the housing market, this crazy housing market that we’ve seen, will only help buyers and sellers when they have a full transparent, you know, view of the housing market,” Triem said. “They’ll be able to make the best decisions based on that and not have that kind of be secretive and kept, you know, by the experts who will dole that information out when they feel that it will benefit them. So, I would urge people to vote against that, to vote no on the mandatory disclosure.”
A property’s assessed value is only one piece of its annual tax bill. The property tax rate, also known as the mill rate, is the other main factor. And every year as part of its budget process, the Juneau Assembly revisits it.
For most property, the tax bill is calculated by simply multiplying its assessed value with the mill rate. For most of Juneau, that rate is 1.056%.
We asked several Assembly members what they would do if there were an abrupt increase in overall property assessments. Answers varied, but lowering the property tax rate was on the table.
For more reporting and resources on Juneau’s local election, visit KTOO’s local elections page.