# Or. Admin. R. 150-311-0240 - Procedure to Correct MAV When Square Footage Error Exists

Current through Register Vol. 61, No. 4, April 1, 2022

** Example A:** An example is
incorporated into the steps with the following assumptions:

The assessor's records show that a parcel has 435,600 sq. ft. (10 acres), when, in fact, it only has 392,040 sq. ft. (9 acres).

The existing RMV is $80,000.

The corrected RMV is $75,000.

The existing MAV is $50,000.

Step 1: Divide the correct RMV by the RMV as currently shown in the assessment records to determine the proportional RMV correction.

Outcome: $75,000 / $80,000 = 0.9375.

Step 2: Multiply the proportional RMV correction (Step 1) by the existing MAV for the property to determine the corrected MAV for the property.

Outcome: 0.9375 X $50,000 = $46,875, which is the corrected MAV for the property.

** Example B:** An example is
incorporated into the steps with the following assumptions:

A property consists of a 3-acre land parcel and two buildings.

Building 1 was incorrectly valued as having 2,000 square feet, when in fact it has only 1,500 square feet.

Current Real Market Value (RMV) of the building with the error is $80,000.

Corrected RMV of the building with the error is $50,000.

The square footage on the land and other building is correct.

The property's total RMV is $400,000.

The property's total MAV is $300,000.

**Short method:** Step 1: Divide the correct total RMV
by the total RMV as currently shown in the assessment records to determine the
proportional RMV correction.

Outcome: $370,000 / $400,000 = 0.925

Step 2: Multiply the proportional RMV correction (Step 1) by the existing MAV for the property to determine the corrected MAV for the property.

Outcome of short method: 0.925 X $300,000 = $277,500, which is the corrected MAV for the property.

**Long method:** Step 1: Determine which component has
the square footage error.

Building 1 is the component with the error in square footage.

Step 2: Determine the portion of the property's total RMV that is contributed by the component with the square footage error.

Building 1 RMV is given as $80,000.

Step 3: Calculate the ratio of the RMV of the component with the error to the RMV of the entire property.

Outcome: Building 1 RMV ($80,000) divided by Total RMV ($400,000) = 0.20.

Step 4: Multiply the property's total MAV by the ratio obtained from Step 3 to determine the MAV attributable to the component with the error in square footage.

Outcome: $300,000 x .20 = $60,000.

Step 5: Subtract the MAV attributable to the component with the error in square footage (Step 4) from the property's total MAV to determine the base MAV.

Outcome: $300,000 - $60,000 = $240,000.

Step 6: Divide the correct RMV of the component by the RMV of the component as currently shown in the assessment records to determine the proportional RMV correction ratio.

Outcome: $50,000 / $80,000 = 0.625.

Step 7: Multiply the proportional square footage error ratio (Step 6) by the MAV attributable to the component with the square footage error (Step 4) to determine the corrected MAV attributable to the component.

Outcome: 0.625 x $60,000 = $37,500, which is the corrected MAV attributable to the component.

Step 8: Add the corrected MAV attributable to the component (Step 7) to the base MAV (Step 5) to determine the corrected MAV for the entire property.

Outcome of long method: $37,500 + $240,000 = $277,500, which is the corrected MAV for the property.

### Notes

Statutory/Other Authority: ORS 305.100

Statutes/Other Implemented: ORS 311.234

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