D.C. officials say they expect about 2,500 residents to challenge their property taxes this year before the city's appeals board, a significant increase over the 1,401 who did so last year.
Some of the increase can be attributed to the fact that the city has done about 50 percent more assessments this year than last year, the officials said.
But the higher number also illustrates the frustration many residents feel about their property assessments, which have skyrocketed in the past three years with the city's hot housing market.
"It's a desperate situation for some homeowners," said Peter Craig, a Cleveland Park resident who is leading a class-action lawsuit against the city over its assessment methodology.
About 50 residents attended a public hearing Wednesday night before the appeals board at which city officials said they have been besieged with complaints.
"We have gotten a lot of comments from taxpayers who are rather distressed," said Phillip Appelbaum, manager of litigation and appeals for the city's tax office. But, he said, the higher assessments "are a result of the current market."
The deadline for filing an appeal to the Office of Tax and Revenue is Tuesday. The office will rule on the appeals it receives; residents who are unhappy with the decision may then file a second appeal to the Board of Real Property Assessments and Appeals. Officials expect the board to receive the 2,500 cases.
"There's a real sense that something sinister is going on, but that's not the case," said Paul Strauss, acting appeals board chairman. "Assessments are up because sales prices and values are up in the District and metro region, which, until the tax bill comes, everyone uniformly thinks is a good thing."
The city this year mailed new assessments to all 130,000 residential property owners, as well as 43,000 commercial properties.
This was the final year of the phase-in of a new system under which all D.C. properties will be assessed every year. Previously, the city used a triennial assessment program.
About one-third of the city's residential properties had not been assessed since 2001, and those homeowners' assessments increased significantly. In several neighborhoods, the average property assessment increase was more than 50 percent.
Two years ago, the D.C. Council, responding to residents' complaints about rising property taxes, capped annual tax increases at 25 percent.
The average residential property tax bill in Montgomery County, which assesses triennially, rose 46 percent in 2001 and 2002. Fairfax County's residential property taxes, assessed annually, rose an average of more than 14 percent in a year.
Craig, the Northwest resident who is challenging the city's methods, said he has done a detailed analysis of D.C. property assessments. In many cases, properties have been wildly undervalued or overvalued, he said.
The reason, he says, is that the city still relies on "trending," the practice of assessing an entire neighborhood based on the sales prices of a handful of houses. This doesn't take into account characteristics of an individual house, such as a big lot, an addition or a location on a busy street.
"It's screwy, upside down, illogical and has been condemned by all experts," Craig said. "They can't continue this tyrannical system."
Of the 1,401 cases the appeals board received last year, it has ruled in 1,266 and expects to complete the remaining 135 within two weeks. The board has reduced the assessments in 599 cases.
Officials said that they have honed their assessment process this year using a new computer-based system that takes into account many more characteristics of individual homes. Last year, only 4,000 homes were fed into the computer, but this year, more than 45,000 were entered.
Appelbaum said the city cannot afford to inspect each property. To do so, it would need 125 to 150 assessors; currently it has 16.
"It's a matter of resources," said Appelbaum, adding that the city hopes to do rotating inspections that would ensure that each property is looked at every five to eight years.
Some homeowners say that even if the assessments do reflect true market value, the city is unfairly penalizing longtime residents.
New residents who purchase homes at current market values presumably are aware of the amount of taxes they will have to pay. But some longtime residents who bought homes when the market was slow and do not plan to sell -- including many senior citizens on fixed incomes -- will have trouble paying the increased taxes.
"It has been a sticker shock for all of us," said Veldat Geldiay, a homeowner in American University Park. "People who have been living here for 10 or 15 years, their salaries don't go up by even 25 percent each year. But my house went up 63 percent. Why is it that residents who have lived here when everyone else fled are being penalized?"