While typically not a formulator of policy, property assessors are likely sensitive to political incentives as they are either directly elected to their office or appointed by another elected official. This paper estimates a model that is motivated by the assumption that assessors seek to maximize political support in a manner that effects the assessment-to-sales price ratio. Using panel data from a 2001 to 2006 series of sales price ratio studies in Virginia cities and counties, a fixed effects variance decomposition regression reveals a variety of socioeconomic and political variables that bias the assessed value away from fair market value. In addition to finding influential socioeconomic factors, the results indicate that elected assessors underassess more than appointed assessors. Furthermore, it appears assessors try to export the property tax onto commercial property via higher assessments, and assessors in districts with higher measures of local government fiscal stress tend to give higher assessments.You could interpret this a few different ways. Either elected county assessors are bad because they're depriving public treasuries of needed funds due to crass reelection motives, or they're good because they help keep taxes low in a way that appointees simply won't.
Monday, December 6, 2010
We've had a couple of threads going (see here and here) about the value of down-ballot offices being elected or appointed. Commenter Justin Ross provided a link to some of his highly relevant research on this topic. Ross finds that the properties assessed by elected county assessors tends to be undervalued relative to that assessed by appointed county assessors. From the abstract: