Vermont H480: Prepare for a Property Reappraisal Barrage

Written by: Patrick Price, Vice President of Operations, Property Tax

A seismic shift in Vermont’s property tax landscape is on the horizon. The recent enactment of House Bill 480 (H480) is poised to transform property tax assessment cycles and appeal opportunities across the state. If your company operates in Vermont, brace yourself for an unprecedented wave of reappraisals that may significantly impact your property taxes in the coming months.

H480: What Vermont Business Owners Need to Know

This spring, H480 was passed into law, ushering in a new era of property tax assessments in Vermont. The implications are far-reaching:

• Immediate Reappraisals
  Nearly two dozen towns are mandated to undertake immediate reappraisals of all properties. This represents a substantial endeavor, reflecting the urgency and scope of the changes introduced by H480.
• Potential for Error
  The bulk of the reappraisal work will need to be split up by several third-party contract valuation firms. These vendors will be inundated with work. From what we’ve seen in the past, that heavy volume comes with an increased likelihood of lower-quality valuations.
• Cyclical Revaluations
  Going forward, all municipalities will be required to perform revaluations at least once every six years. This means that roughly 50% of the total 250 towns, many of which have not undergone a reappraisal since 2014, will need to adapt to this new schedule. Astoundingly, 107 of these towns haven’t conducted a reappraisal in over a decade.
• Coefficient of Dispersion (COD)
  H480 introduces a pivotal metric, the “coefficient of dispersion” (COD), which assesses the valuation increases of specific properties or classes. If the COD deviates beyond a predefined standard, a reappraisal will be triggered to ensure an equitable distribution of the tax burden among all properties.

Taking Charge: Navigating the Changes

For Vermont businesses, it is crucial to proactively respond to the implications of H480 on your property taxes. Consider the following steps:

1. Assess Your Property Portfolio
   Conduct a comprehensive evaluation of your real estate holdings in Vermont. Understand how the new valuation methods might influence your tax liabilities.
2. Budgetary Adjustments
   Update your financial forecasts and budgets to accommodate potential fluctuations in property tax expenses. This proactive approach will ensure accurate financial planning and forecasting.
3. Expert Guidance
   Seek advice from property tax professionals with expertise in valuation, working with third-party valuation firms, and Vermont property tax laws. Their specialized knowledge will be invaluable in navigating the complexities of H480.

House Bill 480 represents a watershed moment for Vermont businesses. By proactively understanding and adapting to these changes, you can optimize your tax strategy and mitigate the increases to your property tax expense in this new landscape.