Friday, March 20, 2009

Error, Gross Negligence, or Corruption?

In reading the e-mail traffic on the Shaw neighborhood group (also on renewshaw), I came across an interesting post today. I'm reposting it below for broader readership:

On perusing the DCRA's Winter 2009 Vacant Property Listing and the online Real Property Assessment Database, I found that six of the seven vacant properties owned by Shiloh Baptist Church (or agents of the same) in Shaw are no longer classified as vacant (Tax Class 3) but are instead now classified as Tax Class 1 or 2 (Residential or Commercial, respectively) . Below is a breakdown of the classifications from the online Real Property Database.

Property Address Tax Class
1543 8th Street, NW 001 - Residential
1600 8th Street, NW 003 - Vacant
1526 9th Street, NW 002 - Commercial
1528 9th Street, NW 002 - Commercial
1532 9th Street, NW 001 - Residential
1533 9th Street, NW 001 - Residential
1534 9th Street, NW 002 - Commercial

By all appearances, all seven properties remain vacant (they are all boarded up) and not marketed for sale or lease. I can think of no justification for their tax classifications to have changed. Accordingly, I think this is an error (if not the result of gross negligence or corruption) and could result in lost revenue for the city. Further, it undermines the equity and effectiveness of the Class 3 tax class.

Shiloh should pay the Tax Class 3 tax on all seven vacant properties they own as if this mistake never happened and should not benefit from whatever has caused this reclassification.

Let me absolutely clear here -- these properties have been vacant for 30 years and they are still vacant. The owner's refusal to sell, lease, rent, renovate or do anything with the property leaves Shaw with an island of urban blight. Not too long ago, the city took the positive step of condemning them in order to force repairs, as the historic properties were in danger of being lost.

Recently, the DC Council increased the vacant property tax rate to approximately 10x the occupied residential rate (previously, it was 5x the residential rate). Obviously, Shiloh did not want to pay what would be a massive amount of new taxes on this span of vacant property. Did they find someone at DCRA willing to switch the numbers for them from Class 3 (vacant) to Class 1 (residential) or Class 2 (commercial)? Did they find some valid exception?

The neighborhood, and all DC taxpayers, deserve an explanation.


Shaw Rez said...

Note that I have found no evidence of building permits for these properties in DCRA's online database. If there were active building permits, then these properties could be exempt from the Class 3 tax. However, my understanding is that they would still remain classified as Class 3 vacant properties, so the re-classification would remain an error. But again, it does not appear that any permits have been issued or that any work is going to be underway anytime soon, so it's a non-issue.

Charles Walker said...

I hear Evans is now against the Class 3 vacant tax rate, and thinks it should be abolished.

Cary, is my memory failing me, or did he support the doubling of it last year?

Cary Silverman said...

Yes, Charles, he did vote to double it... before he did so, however, he offered several amendments to exempt new construction, the entire downtown business district, and, I believe, to change the test for DCRA inspectors to find that a particular property is, indeed, vacant (making it more difficult to do so). Those amendments failed to gain the support (they were either voted down or withdrawn). He also proposed increasing the length of time for a commercial property to be considered vacant from 1 to 2 years - that passed. After these attempts to weaken the law, he voted to support the increase.

Cary Silverman said...

Fraud in the news:

Even a Shiloh employee is quoted as stating the conduct is "shady."

Will Shiloh pay back taxes for the $100,000 or so it didn't pay due to apparent fraud? Or does DC only go after ordinary homeowners who don't pay their taxes, throw liens on them, and then sell their property? Tune in next time.