Tenn. Comp. R. & Regs. 0600-13-.10 - APPEALS ALLOWANCE AND RECAPTURE RATE

(1) Determining the appeals allowance must be based on the proportion of atypical appeals reductions experienced by the city or county in the most recent one or more reappraisals. The allowance is derived not merely from the percentage of assessment loss due to appeals in the past reappraisal(s) but on the amount by which this percentage loss exceeded the typical assessment loss due to appeals in a non-reappraisal year. The calculation submitted to the State Board of Equalization should therefore include documentation of the total assessment base before and after appeals, for the year of the most recent reappraisal and the year before the most recent reappraisal. The allowable adjustment is the percentage by which the reappraisal year percentage loss exceeded the loss from the year before. If data is available for more than one recent reappraisal, an average may be used. If no verifiable data is available, the allowance is not permitted. In order for an allowance to be administered it must be approved by the Executive Secretary of the State Board of Equalization.
(a) Explanation of calculation: The appeals allowance will appear in the certified tax rate calculation as an assessment amount to be deducted from the reappraisal year assessment base, and the amount is determined by multiplying the reappraisal year assessment base (local assessments only) times the percentage determined under item (1) above.
(b) Upon receipt of the assessor's report, the State Board staff shall record net aggregate assessment reductions by the county board of equalization in the certified tax rate file for each city and county. In addition, on or before May 1st of the year following the reappraisal, the State Board staff shall record in the certified tax rate files, the net aggregate assessment reductions by the State Board of Equalization to date for the reappraisal year. If the total of these assessment reductions exceeds the appeals allowance used in the certified tax rate, the Board shall notify the assessor and the chief executive officer of the city or county, and a certified recapture rate shall be calculated and determined for the city or county for the year following the reappraisal.
(2) The recapture tax rate shall be the actual tax rate from the reappraisal year, reduced by the amount by which the reappraisal year certified tax rate was overstated due to the excessive appeals allowance. The city or county may not exceed the certified recapture tax rate in the year following the reappraisal. without providing public notice and hearing in the same manner provided for exceeding the certified tax rate in a year of reappraisal. The city or county must provide the same compliance documentation regarding the recapture rate as is required when a certified tax rate is exceeded (affidavit of publication and certified copy of tax rate ordinance/resolution).
(3) EXAMPLE OF DETERMINING RECAPTURE RATE:

EXAMPLE

Calculation for certified recapture rate

City of ___________ , 2019 (as of 6-30-19)

Line no.

Item

1

2018 assessed value

130,793,172

2

(+) 2018 appeals allowance

1,053,000

3

Unadjusted assessments

131,846,172

4

(-) Net assmt. changes

849,130

5

Adjusted base

130,997,042

6

Certified tax rate levy

1,106,069

7

Rate bef. 2018 increase

0.844 (line6/line5)

8

2018 increase (if any)

0.01

9

Recapture rate

0.854

SIGNED: ______________________ __________________________

Assessor Mayor

Notes

Tenn. Comp. R. & Regs. 0600-13-.10
Original rules filed April 1, 2020; effective 6/30/2020.

Authority: T.C.A. §§ 4-3-5103, 67-1-305, and 67-5-1601.

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