Cochise County assessor explains valuation methods, warns mobile-home revaluation may raise assessments

During the same March 20 meeting, the county’s assessor gave a summary of the office’s property-valuation methodology and said the office is undertaking several large projects, including converting commercial properties to a new costing system and revaluing mobile homes.

The assessor described the county’s two-part valuation approach: separate values for land and for structures. The office uses a nationwide costing system (Marshall & Swift/CoreLogic) as a starting point for replacement-cost-new estimates, applies location and regional adjustments and then depreciates structures for age and condition. The assessor said staff divide the county into market and submarket areas, compare depreciated cost values to local sales and apply market adjustments to produce final full-cash values.

The assessor told supervisors the existing statutory method for valuing mobile or manufactured homes uses acquisition cost depreciated for age without a market adjustment, which in the assessor’s view has led to systematic undervaluation. The assessor said a 30-year-old double-wide that sold for about $50,000 historically is currently assessed at a fraction of its likely market value and that planned revaluation would increase assessed values for such properties. The assessor noted statutory limits on the county’s “limited property value” calculation, which typically restricts annual increases to 5% for many parcels unless significant improvements occur.

The assessor also discussed ongoing litigation over valuations for orchards and vineyards. He said the county believes tree crop values have been set too low in the Department of Revenue agricultural manual (which the assessor cited as showing $600 per acre for trees) and that the county’s conservative valuation approach uses a much higher figure (the assessor cited $12,000 per acre for trees). The assessor described the difference in treatment between permanent tree crops and annual field crops as central to the dispute in court.

The assessor said a major commercial revaluation project is underway and offered to provide the board with a historical summary of property-tax developments in Arizona over the past 40 years.

Supervisors and staff asked questions about location adjustments, the treatment of off-grid or alternative-construction homes and the public reaction that could follow a mobile-home revaluation; the assessor acknowledged owners are likely to object to higher valuations. The assessor said staff would follow up and make presentations to the board as the projects progress.