Minnehaha County equalization director reports modest market gains, warns of effect of Senate Bill 216

Minnehaha County Director of Equalization Chris Lillard briefed the County Commission on March 18, 2025, on the office's 2024 assessment results, appraisal methods, appeals activity and how recently enacted Senate Bill 216 could change how valuation changes are distributed across property classes.

Lillard said the county's 2024 assessment process produced a countywide level of assessment of about 90.3% and an average market change of roughly 5.09% for the year. He told the commission the office continues to use the three standard appraisal approaches'cost (using Marshall & Swift cost tables), sales-comparison and, where applicable, the income approach for income-producing properties.

The update matters because county-assessed values feed the taxable-value equalization process used to set levies and because the recently adopted Senate Bill 216 will cap the owner-occupied increase at 3% for the coming period, which Lillard and commissioners said will shift the remainder of allowable growth to non-owner categories rather than reduce total county taxable value.

Lillard gave several operational details: Minnehaha County has about 78,600 active parcels and an estimated population of 212,000; transfers (which include deeds that are not open-market sales) rose from 6,170 in 2023 to 7,336 in 2024. The office completed targeted physical reviews in 11 neighborhoods (eight in Sioux Falls) and three townships last year, and it continues to reconcile parcel records, photos and inspection notes in its mass-appraisal system and to use the Beacon public property portal for transparency.

He described how the office calculates values: the cost approach starts from construction cost new (Marshall & Swift), then applies depreciation; the sales-comparison approach checks like sales in the local market; and the income approach is applied chiefly to apartments and other income-producing properties. Lillard said some neighborhoods fell in market value this year while others rose; countywide averages masked that variation.

On appeals and customer outreach, Lillard said the office mailed notification letters to homeowners in neighborhoods scheduled for physical review and that appraisers wear county identification and drive marked vehicles when making inspections. He told the commission a typical exterior and interior verification visit is roughly 10'15 minutes and that appraisers will remeasure or adjust sketches when discrepancies are observed; if owners are unwilling to allow an interior inspection, the office uses permit data, listing photos and other public records to inform values and will not "give the benefit of the doubt" on finish where information is lacking.

Lillard said the office currently had about 10 residential appeals and four commercial appeals pending at the local level, and that many potential appeals are resolved through pre-appeal conversations when staff can show comparable sales and explain methods. He also said that recent data cleanup and more consistent grading and land-value work have reduced appeals overall during his tenure.

Commissioners pressed Lillard on implementation details for Senate Bill 216. Lillard said, based on his interpretation and recent clarifications, the 3% cap applies to owner-occupied property class totals and not to every individual parcel, which means the uncaptured portion of market-driven increases will be allocated to other property classes rather than being eliminated. Commissioners warned this will create shifting burdens among taxpayers and urged clearer guidance from the state.

Lillard also reviewed program-level items such as renewal-energy assessment treatment (a temporary exemption for geothermal additions), owner-occupied adjustments, the elderly freeze process (administered jointly with the treasurer), disabled veterans exemptions (currently the first $200,000 of value exempt for qualifying veterans), and the discretionary commercial exemption schedule counties and municipalities may apply for new commercial construction.

The director said the office will continue neighborhood-targeted physical reviews and data-model refinements (including splitting apartment-size cohorts in the commercial model to better match sales). He recommended continued public outreach so owners understand methods and appeal options.