Skip to comments.Some strange things happened after The Plain Dealer's publisher challenged his property value
Posted on 08/22/2010 5:39:00 AM PDT by Diago
Every three years, when Cuyahoga County Auditor Frank Russo updates property values countywide, he notifies taxpayers of proposed new values and invites them to fill out a form if they disagree.
The process is separate from the formal complaints filed with the county's Board of Revision after property values are set.
Plain Dealer Publisher Terrance C. Z. Egger took advantage of the informal process in 2006 after receiving a letter notifying him of the proposed value of his Bay Village home.
Then, some strange things began occurring.
The first, Egger said, was that Frank Russo himself called Egger at The Plain Dealer to talk about the house value.
Then, in March this year, one of Russo's employees contacted Egger to warn him that a 2006 cut in his property value would be leaked to television reporters if the newspaper continued writing about the auditor, Egger said.
Finally, Egger's file at the auditor's office disappeared. No one employed by the auditor could find it this week until late Friday afternoon, after the newspaper called to say it was publishing this story.
Workers then located it--in Russo's private office.
Egger purchased the Bay Village house in May 2006 for $1,540,000. As he and his wife arranged to close, they expected the property taxes to be about $15,000 a year, but they were shocked when they saw settlement documents showing the taxes would be about $30,000 a year.
During the countywide reappraisal in 2006, when all taxpayers received a "Homeowner Response Form" from the auditor's office. For the Eggers, the notice proposed a home value of $1,341,400. The Eggers thought that value was still to high and filled out an online form to ask for a reduction.
They argued that the taxes were dramatically higher than comparable homes in the area.
Egger said he was surprised when, a short time later, he received a call at his Plain Dealer office from Russo. Egger said Russo asked whether the Eggers' challenge to their assessment was connected to a newspaper story. Russo explained to Egger that years earlier, then-Editor Doug Clifton had ordered a story after the assessment of Clifton's home changed, Egger said.
Clifton, who retired from the newspaper in 2007, said in a telephone interview Friday that his value had dropped inexplicably, without him asking. He thought that was odd and asked reporters to find what was going across the county. The resulting story was embarrassing for Russo. It pointed out that mistakes and bad judgment by the auditor's office had wrongly removed $115 million in value from the tax rolls.
Egger said he explained to Russo that his request for a reduction had nothing to do with the newspaper. He said he challenged his assessment like any other taxpayer can and was not seeking special treatment.
Looking back, Egger said he didn't understand why his house would be flagged or why Russo would call, as the form didn't list his affiliation to the newspaper. And the house was in the name of Egger's wife.
In October 2006, Egger received a letter signed by Russo saying the value of his home had been reduced to $1,176,900, a decrease of $164,500.
During the first week of March this year, an auditor's employee e-mailed Egger, and Egger called the man a day later. The man, whom Egger declined to identify, complained about the newspaper coverage of Russo. The employee stressed that senior officials and other workers in Russo's office were tired of being scrutinized in the newspaper.
He said that Egger's "deal" would be leaked to television reporters if the newspaper continued writing about the office, Egger recalled.
The warning was inappropriate and disturbed him, Egger said.
"I had nothing to hide," Egger said. "I'll be damned if I'm going to ask one of our reporters or our newsroom not to do their jobs. The chips will fall where they may.
Last week, as The Plain Dealer continued probing how boards of revision operate in Cuyahoga County, editors decided to publish a story about Egger's experience. When reporters went looking for Egger's file in Russo's office, workers said it did not exist.
Egger, however, had kept his own copies of the records, enabling reporters to proceed with the story. Friday afternoon, after the newspaper called Russo's office for a comment, workers suddenly found the missing file -- in Russo's private office.
Destin Ramsey, Russo's chief operating officer, said Russo took the file because a Plain Dealer reporter was asking questions about Russo's home. Russo wanted to compare his home to Egger's, Ramsey said.
The file includes memo about Egger's home, which says that in 2006, Egger "called the Auditor's Office and specifically asked for the Auditor himself, Frank Russo. They had a lengthy conversation and Mr. Russo turned the complaint over to Senior Appraiser Dan Harbaugh."
The memo is undated, but it had to be written this year because it refers to a March 2010 newspaper article about Bay Village property values, which is included in the file. The file also contains the text of Egger's 2006 argument for a lower value, which was extracted from the county data center and e-mailed to Cindy Bialowas, a Russo aide, on March 1 of this year.
Egger says March is exactly when a worker in Russo's office warned him that details of his reduction in value would be released to the media if The Plain Dealer did not stop probing.
Ramsey said he does not know who wrote the memo about Egger, but he said Russo would not have initiated talks with the publisher.
"I've never seen Frank call anybody up front," Ramsey said. "His call list is as long as Kentucky. He calls everybody back. "
"It absolutely did not happen," he said. "He initiated the phone call."
$30k in property taxes sound well in excess of services provided.
I don’t know about Cleveland, but in the Pittsburgh area, property assessments seem to be at the whim of the assessor. No one takes into account things like the neighborhood, the condition of the home or the values assigned to similar homes in the neighborhood. Even after lawsuits, the assessors here still can’t get it right. One wonders too about corruption — is there bribery or extortion involved in order to get a better assessment?
My house is valued the same as when I bought it in 1989. This, despite the decline of the neighborhood. Most of the houses in my neighborhood are valued less than mine. I guess I should be grateful the assessment hasn’t gone up, but still.
1. I am sick of the elitist press.
2. Did some second year intern write this “article”?
Yet another reason why property tax should be illegal. As long as property taxes are legal, then the Fifth Amendment is not guaranteeing our God-given right to own private property.
Anywhere on the east or west coast (or almost anywhere but Cleveland) it would probably be valued north of $3 mil.
A town assessor will be visiting the house in the next week or so for reevaluation - I’ll be messing up the yard, not cleaning anything - taking doors off of cabinets...need to come in low.
Time for a new editor.
OMG!! Doesn’t ANYONE know anything these days??
In Ohio, taxes run approximately 2% of a property’s value (although that is not how taxes are actually assessed). The $30,000 figure does not seem out of line to me for a $1.5 million house, although there could be some reason why taxes in Egger’s neighborhood are less than the norm.
In Pittsburgh we pay closer to 4% of the value—so $30,000 is low, it could be more like $50-60 thousand. Plus if he lives in Bay Village he probably has lake front property. I wish I could afford a $1 million house.
One of the reasons that the only taxes should be a straight and uniform percent levied on retail sales. Every other tax ends up violating equality before the law because no two incomes are derived from an identical mix of sources and no two homes are alike.
More like a kindergartner.
What I’m getting is that he bought the house for 1.5 million, then it was assessed for 1.3 million, and the buyer said “It’s not worth that much!” right after paying the 1.5 million.
Doesn’t speak well for the buyer’s business accumen.
Hey he seems to be in the newspaper business — a dying endeavor.
Newspapers will do anal exams of local tax assessors but they have no interest in finding out who Barack Hussein Ubanga is.
This rich newspaper magnate Egger bought the $1.5M house in May 2006, right around the peak of the real estate market boom. Nearly everybody who bought a house during 2005 - 2007 paid more than today’s market value.
It is Bay Village!
Bay Village boasts a highly educated and professional population and a quality school system, making it one of the most desirable residential suburbs of Cleveland.
The effective real property tax rate for Bay Village is 76.26 mills or 2.34% of the value of the property.
Yeah, I know. I was just being nice. Egger has some explaining to do IMO.
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