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Quake Victims Encounter Taxing Delay at Assessor's : Residents and business owners wait for property-tax relief as officials are still wading through 49,000 earthquake damage-related applications.

October 11, 1994|GREG MILLER | TIMES STAFF WRITER

The one-year anniversary of the Jan. 17 earthquake will probably have come and gone before thousands of residents and businesses receive property-tax reductions or refunds on taxes already paid on their quake-damaged parcels, county officials said.

More than 49,000 applications for quake-related property-tax relief have been filed in the eight months since the earthquake rumbled across the Southland, said John Crowner, director of appraisals at the Los Angeles County assessor's office.

Although the office initially hoped to finish processing all the relief applications by Sept. 30, only about one-third of the claims had been handled by that date, Crowner said, and the task is now expected to stretch into January.

"It was more time-consuming than expected, and we have had to streamline our operations," Crowner said. As a result, many property owners who filed for temporary reductions in property-tax assessments because of quake damage could still be waiting in February for tax refunds or revised tax bills to arrive in the mail.

Due to damage from the quake, as much as $1.4 billion may be trimmed from local property values, mostly in the San Fernando Valley, Crowner said, and up to $19 million in county property-tax revenues could be lost.

The county has also been dealing with a separate batch of claims for reductions in property taxes. Property values throughout the county have also declined in recent years because of the recession in Southern California. Under a state law that allows owners to seek tax relief in such cases, 35,899 parcels were reassessed in the year that ended June 30 for a total devaluation of $5.8 billion, the assessor's office said. About 3,000 applications submitted last year under this law are still being processed.

Property owners whose parcels have suffered quake damage are taking advantage of a state law that permits owners of disaster-damaged properties to seek tax relief by having their property values temporarily reduced, until property owners make repairs and the values of their parcels are restored.

Generally, property owners pay taxes of about 1.25% of the assessed value of their parcels each year, with the 1% portion going to the county and local governments and the remainder paying off voter-approved debt.

So far, quake-damaged properties have been devalued by an average of $35,000, though devaluations range from millions of dollars for crumbled commercial properties such as the Northridge Fashion Center to a few thousand dollars for "something a few blocks away where the garden wall is down," Crowner said. The average reduction in an annual property-tax bill for quake-damage claimants, Crowner said, is about $350.

In Los Angeles County, property taxes are paid twice a year, with the first installment due in December and the second due in April. Following the quake, about 26,000 property owners met an early application deadline and were granted deferrals on their April, 1994, tax payments. Many of those owners are now waiting for revised tax bills to arrive.

Others who did not receive deferrals paid their April installments in full and are waiting for refunds.

In the meantime, bills for the current property-tax year are scheduled to be sent out within a few weeks. Owners whose quake-damage claims have already been processed should receive reduced bills, Crowner said. Most owners who filed quake-damage claims will have to wait for bill correction notices to arrive later. But even those who received deferrals on their April tax payments because of quake damage must still pay their December, 1994, tax bills.

Despite the quake-damage claims, total assessed property values increased countywide by 1.3% to $497 billion for the past fiscal year. But that was one of the smallest annual increases in memory, officials said.

As already strapped local governments consider the gloomy tax implications of that news, the assessor's office must continue to climb a paperwork mountain. A special team of 40 assessors--all temporarily lured back from retirement--has been assembled to handle the damage claims. Still, by the end of September, only 17,000 of the 49,250 applications submitted had been processed, Crowner said.

Until about a month ago, assessors called every property owner who submitted an application, seeking to verify information or get updated damage estimates. The practice slowed the process considerably, said Rod Herman, who supervises a crew of assessors handling quake-related applications in a cramped corner of the assessor's office in Van Nuys.

Some owners couldn't be located, said Herman, 64, a county assessor for 32 years before he retired in 1988. Others, Herman said, "were still so traumatized they didn't want to talk about the earthquake or damage to their property."

Hoping to speed things up, assessors are now calling owners only when applications are incomplete. Even when the amount of damage listed on a claim totals $500,000 or more, Herman said, the application will usually be processed without a call or a visit to the parcel as long as the owner submitted sufficient evidence, such as pictures of the damage, a repair estimate signed by a contractor or a signed insurance claim.

As a result, the assessor's office is processing quake-damage claims at a much faster pace. Last month, the office plowed through 3,162 claims in a week, Crowner said, about four times as many as a month earlier.

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