Harrisonburg Board of Equalization keeps most assessments, approves one reduction after day of property appeals

The City of Harrisonburg Board of Equalization heard a full morning and afternoon of property tax appeals and motions on multiple commercial and mixed-use parcels, leaving most assessments unchanged while approving a single assessment reduction and promising written decisions on more complex cases.

The hearing covered appeals by representatives for AutoZone, Shenandoah Plaza, Valley Mall, Car dealerships including CarMax, several residential and raw-land parcels tied to the Virginia Land Trust and Country Club Road area, and a Walmart property. Board staff paused briefly for confidential income testimony where appellants requested it and reminded speakers the session was being recorded.

Why it matters: The board’s decisions affect final assessed values used to calculate property taxes and can influence future investment, redevelopment and litigated disputes about land suitability, flooding, subsurface conditions and zoning interpretations.

Votes at a glance - Tax map 104H6 (AutoZone parcel): Board moved to adjust assessed value to $1,550,000; motion carried. (Motion text recorded: “I move to adjust the assessed value of tax map number 104H6 to $1,550,000.”) - Tax map 006-AD-1 (2475 South Main Street / Shenandoah Plaza): Motion to have no change to the assessment; motion carried. - Tax map 078C3-C and tax map 078C3 (parcels associated with Valley Mall appeals): Motions for no change to assessed values were made, seconded and carried. - Tax map 014P5 (Walmart): Motion to keep the assessment as no change; motion carried. All motions listed above were made, seconded and announced as carried by voice vote; the minutes record the chair saying “motion carries” after each voice vote. The board said it will provide written notification of decisions to appellants where required.

What proponents and representatives told the board - AutoZone/Mark Shenandoah LLC (represented by Daniel Grubb): Grubb told the board the primary disagreement with the assessor was the hypothetical market rent used in the income approach. “They gave it $18 a square foot. Our CoStar data shows $16 a square foot,” Grubb said, and he also argued the assessor’s worksheet omitted a market vacancy allowance. Grubb’s estimate produced lower gross potential income and a different value than the assessor’s worksheet.

- Valley Mall (represented by Mark Whitney, tax representative for the mall owner / Macerich Company): Whitney described a continuing decline in mall performance and tenant departures since 2019. “Our NOI is down over 33% since 2019,” Whitney told the board and described a recent national-tenant loss trend at the property. He said 31% of shop space was either occupied by temporary tenants or vacant, and that the owner had submitted confidential income and expense documentation for the board’s review during an off-record portion of the hearing.

- Car dealership parcel (presenter with appraisal materials for CarMax Harrisonburg): The presenter described a sales-comparison and pro forma income analysis for an auto dealership site and noted assessor land values rose notably this year. The presenter said comparable raw land sales supported a lower adjusted land value per acre (an adjusted sale-based figure of about $324,002 per acre in his analysis) than the assessor’s implied land value (roughly $431,000 per acre in the assessor’s study), and reported a pro forma income-based value for the dealership near $3.37 million using a 7.5% cap rate.

- Country Club Road / Virginia Land Trust parcels (presented by Mr. Kostelak): One of the most detailed appeals came from a representative speaking for multiple contiguous parcels owned or optioned by local interests and the Virginia Land Trust. Kostelak argued the assessor’s values did not reflect a set of physical and regulatory constraints he says materially impair the land’s marketability: a mapped cave/karst system with sinkholes and large undocumented fill, subsurface conditions that would require very costly engineering, changes to the floodplain polygon associated with recent nearby fills, limited feasible entrances constrained by a railroad corridor, and unpredictable local zoning interpretation and ordinance changes over time. Kostelak told the board the site-specific engineering estimate done earlier (Blackwell Engineering, 2007; updated work requested in 2022) put remediation or preparation costs into the tens of millions and said, “the total value, I’m asking should be raised at 50% or lower of the most recent tax assessment,” meaning he sought a substantial reduction. The board recorded the presentation and said it would notify appellants in writing of the board’s determination for those complex parcels.

Board procedure and next steps Board staff and the chair repeatedly reminded presenters that parts of testimony that contained income or other confidential taxpayer information would be taken off the record upon request and then resumed after the confidential portion. The board handled some confidentiality requests in that fashion during the Valley Mall and other commercial appeals. For motions recorded at the hearing, the board announced outcomes by voice vote and stated it would issue formal, written notices to appellants with final determinations and any adjustments to assessments.

What the board did not decide at the hearing Several appellants provided extensive documentary exhibits, sales-comparison grids, and pro forma income workups. For the larger, more complex parcels — notably the multi-parcel presentation tied to Country Club Road and the Virginia Land Trust properties — the board did not announce a final on-the-spot outcome in the hearing; instead, staff said a written determination would follow.

Officials and speakers City staff conducting the hearing included Shannon Dewitt Kealey of the City of Harrisonburg real estate/assessor office, who managed the record and off-record breaks for confidential testimony. Appellants and their representatives included Daniel Grubb (representing AutoZone and Mark Shenandoah LLC), Mark Whitney (tax representative for Valley Mall / Macerich Company), Alex Mitchell (representing Walmart), and Mr. Kostelak (representing or speaking for several Country Club Road / Virginia Land Trust–related parcels). The board’s chair and other unnamed board members made and seconded motions throughout the session.

The board recessed during the day for lunch and concluded hearings at the session’s close; staff said follow-up materials and written determinations would be sent to appellants by mail.

Ending note: The board’s written notices to appellants will state any assessment changes and give appeal instructions and deadlines where applicable; the board and city assessor’s office also keep the hearing record and the confidential materials off the public recording per the city’s procedures for taxpayer information.