Assessment revaluation befuddles Penn Hills golf course operator
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Property reassessment is giving Art Hawk, the operator of Three Lakes Golf Course, a bad case of financial whiplash.
In January, Allegheny County's Office of Property Assessments more than tripled the market value on the 151 acres he owns in Penn Hills from the current $1.9 million to $6.2 million for next year.
After he made a successful informal challenge in February, the county Board of Property Assessment Appeals and Review slashed the new assessment to $2.3 million in March.
Believing that the revised value was still too high, Mr. Hawk made a formal appeal to the county appeals board. That proceeding was held Aug. 20.
He argued for a $1.5 million valuation, pointing to a slowing economy and increased competition for golfers' dollars. "I showed him what I paid for it -- $1.9 million in 2007," Mr. Hawk said. That amount included all the maintenance equipment, supplies and furnishings. "The economy hasn't gotten much better since then."
On Nov. 2, he learned the results of his formal challenge: The appeals board raised the total market value to $5 million.
"It's like they picked a number out of the air," Mr. Hawk said.
That new assessment places the 2013 market value of his 18-hole course, pro shop and clubhouse well above that of nearby but much larger and more luxurious Longue Vue Club.
Currently valued at $2.4 million, Longue Vue has been reassessed at $3.7 million. Its 345 acres in Penn Hills include a pool, tennis and paddle-ball courts and a skeet- and trap-shooting range, in addition to the golf course. It is a prime location for upscale weddings and other affairs.
David Montgomery, the appeals board's solicitor, said the county agency was reviewing the latest value for Three Lakes.
"We're looking into it," he said Tuesday.
He rejected the idea that Mr. Hawk was being punished with a higher assessment after he appealed the $2.3 million value that resulted from his informal challenge. "There always is a chance that your assessment can go up as the result of an appeal," Mr. Montgomery said. "But that tends to be rare."
If the appeals board ultimately declines to change its $5 million valuation, Mr. Hawk can challenge that decision before an independent Board of Viewers that is part of the county court system.
Mr. Hawk estimated that it would cost him at least $6,000 in filing, legal and appraisal fees to take his assessment challenge to this level. Still, it would appear to make economic sense for him to do so.
His current annual school district, municipal and county property taxes on Three Lakes total almost $69,000. While taxing bodies are required to cut their millage rates to reflect higher assessed values and avoid reassessment windfalls, properties owners like Mr. Hawk would still be in line to see big jumps in their tax bills next year.
Allegheny County Council is considering a 17 percent cut in its millage rate. If Penn Hills and the local school board eventually make similar trims, Mr. Hawk would see his tax bill rise to $149,000 next year if the new assessed value remains at $5 million.
New municipal and school district millage rates will not be calculated until the county's Office of Property Assessment provides its best estimate of the new aggregate values for local real estate. Those numbers are due by Dec. 17.
A big jump in property taxes would represent a setback for Mr. Hawk's efforts to improve business at Three Lakes. The golf course, founded by the Masonic Order, had operated since 1929 as the private Alcoma Golf Club. Mr. Hawk renamed it in 2010, three years after he and his family acquired it and converted it from a members-only to a public course.
As a result of a dispute with his lenders, Mr. Hawk filed for reorganization under Chapter 11 of federal bankruptcy law last year. The golf course and banquet hall continued to operate while loan terms were renegotiated and the business emerged from bankruptcy earlier this month.
"I think $70,000 a year in property taxes is enough," he said of his current tax bill. "I don't know where the money would come from if I had to pay another $10,000 a month."
Future property tax bills for Three Lakes would increase by that amount only if millage rates were not cut.
Operators at other golf courses also have seen big jumps in property values as part of the court-ordered $15 million countywide reassessment.
County assessors have valued Edgewood Country Club's 156 acres in nearby Churchill at $9.8 million, up from the current $2.1 million. In addition to its golf links, Edgewood has a pool and tennis courts.
The assessment on Maple Crest Golf Course, which covers 71 acres in Monroeville, rose from $355,000 this year to $900,000 for 2013.
Those new values, though, are not final. Owners still have the option of appealing to the independent Board of Viewers, although resolutions of many of those challenges is likely to take until sometime in 2014.
The Board of Viewers is a separate agency from the county Office of Property Assessment, which certifies property values and oversees informal challenges, and the Board of Property Assessment Appeals and Review, which decides formal appeals.
Masters from the Board of Viewers first seek to resolve assessment disputes via negotiation and conciliation, according to Michelle Lally, administrative chair for the agency. If opposing sides cannot agree on a resolution, a formal hearing follows with masters taking testimony and making a recommendation on valuation to county court.
First Published November 29, 2012 12:00 am