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Potential of a Parcel-polygon Spatial Database to Increase Property and Sales Tax Revenues

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THE THREE As Digital Parcel Map Accuracy, Availability and Advantages. ... Certification determination done by buffering a point on a street map. ... – PowerPoint PPT presentation

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Title: Potential of a Parcel-polygon Spatial Database to Increase Property and Sales Tax Revenues


1
Potential of a Parcel-polygon Spatial Database
to Increase Property and Sales Tax Revenues
Tract H Communications Professional
Development Session Business Process Change
Technology Date Wednesday, September 1,
2004 Time 130pm - 300pmLocation Salons
AB PRESENTED EARLIER AT IAAO URISA GIS in CAMA
Austin, TX, March 31, 2004URISA Conference
Atlanta, GA October 15, 2003CALGIS 2003 Palm
Springs, CA March 27, 2003 Dennis H. Klein,
AICP PE Boundary Solutions, Inc. Mill Valley,
California September 1, 2004  
2
OUTLINE.
-   THE THREE As Digital Parcel Map Accuracy,
Availability and Advantages. -      DATA SHARING
Policy Survey. - TAX REVENUE ADVANTAGES OF BROAD
USE of Digital Parcel Map Data.
3
BACKGROUND
  • - GIS Location Platform - - National Street
    Centerline since 1980 DIME File.
  • Address ranges based.
  • Addresses displayed as latitude / longitude
    points.
  • Big breakthrough but ERROR PRONE.
  • Parcel Boundaries instead of Address Points.
  • Whats inside a parcel boundary is at an
    address vs. around a point in or near a parcel.
  • Whats at an address is inside its parcels
    boundary.

4
Accuracy
ADDRESS POINTS
5
Accuracy
  • Superior representation of location is not a
    remedy unless boundaries are accurate.
  • Much content produced in the last five years is
    highly accurate.
  • Latest GPS, survey control, image rectification
    technology.
  • - Over 85 is within 4-6 ft.

6
Accuracy
Percent Parcel by Accuracy Category
(60 Million Parcels)
(Source NPDP MetaData Database Records)
7
Availability
- Distributed across over 3000 county / township
jurisdictions. - Of the 120 Million Parcels in
the USA, over 75 Million are now digitized.
8
Availability
Growth By Millions of Parcels
9
Availability - - Projected
PROJECTED COVERAGE 2010 Assumes all counties gt
20,000 Population have a map. Total Counties
1850 (Total Population 260 Million) Total
Parcels 105 Million (Assumes 2.42
persons/parcel)
Includes several Jurisdictions under 20,000 that
have or will soon have a finished map.
10
DATA SHARING POLICIES
ENTIRE JURISDICTION DATABAE PRICE SAMPLE 566
JURISDICTIONS
(Source NPDP MetaData Database Records)
11
DATA SHARING POLICIES
/PARCEL PRICE SAMPLE 566 JURISDICTIONS
(Source NPDP MetaData Database Records)
12
DATA SHARING POLICIES
/PARCEL PRICE SAMPLE 67,000,000 Parcels
(Source NPDP MetaData Database Records)
13
DATA SHARING POLICIES
  • INVISIBLE PARCELS are due to insistence on
    COST-RECOVERY pricing.
  • As more jurisdictions become PUBLIC RECORDS
    COMPLIANT (Duplication Pricing)
  • COST RECOVERY pricing results in a DOUBLE
    PROBLEM
  • - Little Data being sold -gt Low Data Sales
    Revenue.
  • Little Data being sold -gt Low use precludes
    MAJOR tax revenue increases from broad use.

But How Does Broad Use of Digital Parcel Map
Databases Increase Tax Revenues?
14
FIVE WAYS BROAD USE OF DIGITAL PARCEL MAP DATE
INCREASES TAX REVENUES.
  • -     Optimized More Accurate Real Estate
    Transactions.
  • Reduced Insurance Premiums Prices.
  • Lower Cost Infrastructure Operations.
  • - Long Term Improved Built Environment.
  • - Increased Attraction of Major Economic
    Development Projects.

15
PUBLIC INTEREST BENEFITS Optimized More Accurate
Real Estate Transactions
- Flood and other natural hazard Certification
service company operations - Certification
determination done by buffering a point on a
street map. - According to US Postal Service
database (4 digit Zip Code extension). - Highly
accurate when all properties along a street have
uniform frontage. - Because this is often not
the case. 10 - 20 can fall outside
parcel. - Uneven property frontage.- Flag lots
and unnamed alleyways.- Irregular shaped
lots.- Non-compliant address assignments.
16
PUBLIC INTEREST BENEFITS Optimized More Accurate
Real Estate Industry Operations
NO Under Reporting
HAZARDOUS CONDITION
17
PUBLIC INTEREST BENEFITS Optimized More Accurate
Real Estate Industry Operations
Since exact limit of flood and other natural
hazard zones is uncertain. 50 buffering is a
typical practice. 98 of all government sponsored
digital parcel map data within 40
ft. Therefore. Parcel layer has become a viable
location platform for Natural Hazard
Certification Determination. Also, ARGUABLY More
accurate and efficient real estate/financial
operation will result over time in increased
property values and, hence, property tax
revenues.
 
18
For ExampleOptimized Real Estate Operations
Induced Tax Increase
JURISDICTION Monterey County, CA Dallas
County, TX, OH Parcel Count 111,489
820,000 Total Assessed Value
34,700,000,000 163,000,000,000
Increased Real Estate Property Values 1 1 Pr
operty Tax Rate 1.10 2.4 POTENTIAL
TOTAL INCREASED REVENUES 3,539,400
39,168,000 BUT THIS is possible ONLY IF
digital data is priced LOW ENOUGH for BROAD
USE.
19
PUBLIC INTEREST BENEFITSReduced Insurance
Premiums Prices
Large insurance companies and all others served
by Insurance Service Office (ISO). Rates set by
bufferering lat/long address points to determine
if property is in - Wild Fire Zone - Flood
Zones - High Crime Zone - Faults, Tsunami,
Seismic Zone - Subsidence / Landslide
Zone - Which Fire District - Others
20
PUBLIC INTEREST BENEFITSReduced Insurance
Premiums Prices
Manual examination impractical. Findings depends
exclusively on machine readings. Underlying
uncertainty is written off and ... Passed on to
the consumer by being added to the premium
price. This accuracy problem is eliminated by
replacing Address Points with Parcel Boundaries.
21
PUBLIC INTEREST BENEFITSReduced Insurance
Premiums Prices
ERROR FREE Parcel Based Location Platform
Insurance Premium Rate Processing
WILD FIRE
FAULTS
SEISMIC ZONES
CLOSE TO SHORE
HIGH CRIME AREAS
FIRE DISTRICTS
22
PUBLIC INTEREST BENEFITSReduced Insurance
Premiums Prices
Assuming normal market influences, increased
accuracy of parcel boundaries over buffered
address points results in up to a 15 reduction
in premium prices. Broad use results in data
sponsor being subject to major insurance
savings. Also, ARGUABLY - Money not spent on
insurance is spent locally, increasing sales tax
revenues.- Insurance savings enhances location
desirability, real estate values and tax base.
23
For ExampleLower Insurance Premium Induced Tax
Increase
JURISDICTION Monterey County, CA Dallas
County, TX, OH Parcel Count 111,489
820,000 Total Assessed Value
34,700,000,000 163,000,000,000
Premium Price / Assessed Value
Ratio 1 1 Greater Accuracy Induced Premium
Reduct. 12 12 Savings Spent on Sales Tax
Items 80 80 Sales Tax Rate 7.25 8
.25 POTENTIAL INCREASED SALES TAX
2,415,000 12,925,000 BUT THIS is possible
ONLY IF digital data is priced LOW ENOUGH for
BROAD USE.
24
PUBLIC INTEREST BENEFITSOptimized Lower Cost
Infrastructure Operations.
  • Private sector utility service areas can cover
    many counties.
  • Traditionally, their land bases have been
    planimetric maps of - Pavement edges. - Other
    Land Features.
  • For the first time, many counties in their
    service areas have completed parcel maps.
  • Utilities have a growing interest to add an
    intelligent parcel boundary layer.           
  • - Greater detail to expedite facility planning,
    design, maintenance and operation.
  • Improved emergency response from more accurate
    address location.
  • Tightened billing by reconciling customer
    records with corresponding address.

-              
25
PUBLIC INTEREST BENEFITSOptimized
Electric/Gas/Telephone Utility Operations
  • TOGETHER, these benefits yield
  • Lower operation cost and increased service
    quality.
  • Assure competent service without rate
    increases
  • EVEN DECREASES.
  • ARGUABLY, disposable income not spent on
    utility bills is spent locally on other stuff
  • Pumping up Sales Tax.
  • And making the community a more desirable
    location
  • Pumping up real estate prices and hence,
    property tax base.

-              
26

For ExampleLower Utility Bill Induced Tax
Revenue Increases
JURISDICTION Monterey County, CA Dallas
County, TX, OH Parcel Count 111,489
820,000 Total Assessed Value
34,700,000,000 163,000,000,000
Potential Utility Bill Reduction 5 5 Averag
e Annual Utility Bill Per Parcel 4,500.00
5,000.00 Utility Bill Savings Spent on Sale
Tax Items 80 80 Tax Rate 7.25 8.25
POTENTIAL SALES TAX INCREASE 1,455,000
12,177,000 BUT THIS is possible ONLY IF
digital data is priced LOW ENOUGH for BROAD
USE.
27
PUBLIC INTEREST BENEFITS Long Term Improved
Built Environment.
All atrocious, hideously incompatible
developments have one thing in common. They all
received a majority vote at city council / county
board of supervisors. How do really bad projects
get approved? A long standing political reality
- - to get reelected, you have to Dance with
the one who brung ya.
28
PUBLIC INTEREST BENEFITS Long Term Improved
Built Environment.
When partner is community groups and watchdogs,
little chance of bad projects. When main partner
are development interests, bad projects will
happen. There is nothing wrong with this
picture. This balance of power is just the way
it is.
29
PUBLIC INTEREST BENEFITS Long Term Improved
Built Environment.
Easily available GIS data Databases changes this
picture. Best of all, does not challenge the way
it is. But tips the process just the same.
Typical out-of-time and out-of-money developer
rushes about pursuing their interest - -
maximizing profits. Far more concerned about
having three votes than whether it makes sense.
Classic result wrong use, wrong site, wrong
configuration. Spewing out traffic and waste in
all the wrong places.
30
PUBLIC INTEREST BENEFITS Long Term Improved
Built Environment.
The difference the data makes Same time required
to physically attain a copy of a deed
description, same developer can turn on their
computers and reference not only the parcel(s)
description but Surrounding use patterns
Relative assessed value Relative age Use code
/ zoning Block level demographic/ economic
characteristics Traffic intensity General plan
designations Natural and manmade hazards Flora
and fauna And more
31
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32
PUBLIC INTEREST BENEFITS Long Term Improved
Built Environment.
When spatial data is common enough, it becomes
commonly used. Without even meaning to, the same
developer decides to - DO NOTHING - - lure
of cheap land offset by early recognition of
excessive costs. - Spatially query entire
region to find more amenable (profitable) site. -
Check for incompatible conditions and
configures projected accordingly. - Uses
better understanding of neighborhood to optimize
use and configuration.
33
PUBLIC INTEREST BENEFITS Long Term Improved
Built Environment.
  • Ironically, the more spatial data is used,
  • The more pressure by development community on
    elected officials for the data to be OK.
  • The more elected officials make sure GIS
    department has enough budget get the job done.
  • AND ARGUABLY,
  • The more the built environment improves, the more
  • The community becomes a more desirable
    location.
  • - Pumping up real estate prices and the tax base.

34
For ExampleImproved Built Environment Induced
Tax Increase
JURISDICTION Monterey County, CA Dallas
County, TX, OH Parcel Count 111,489
820,000 Total Assessed Value
34,700,000,000 163,000,000,000
Quality Induced Property Value Increase 1 1 P
roperty Tax Rate 1.10 2.4 POTENTIAL
TOTAL INCREASED REVENUES 3,539,000 39,168,000
BUT THIS is possible ONLY IF digital data is
priced LOW ENOUGH for BROAD USE.

35
PUBLIC INTEREST BENEFITS Increased Attraction of
Major Economic Development Projects
Rappatoni Corporation is implementing parcel
boundary based Multiple Listing Services. FARES
just purchased MarketLynx to do the same. About
20 Metros already linked to digital county
databases. Subscriber in New York can browse for
dream parcels where there is coverage.
36
PUBLIC INTEREST BENEFITS Increased Attraction of
Major Economic Development Projects
If your jurisdiction is in one of these systems,
you can be seen. When constraint is high (price,
restrictive use) the Jurisdiction is invisible.
How much more is the GIS budget protected
when Recently attracted out-of-state major (even
green) economic development projects can be
cited rather than last years data sales revenues.
37
For ExampleAttracted Capital Project Generated
Tax Increase
JURISDICTION Monterey County, CA Dallas
County, TX, OH Parcel Count 111,489
820,000 Total Assessed Value
34,700,000,000 163,000,000,000
Ratio Additional Capital Projects / Tax
Base 1 1 Potential Increase in Property Tax
347,000,000 1,010,000,000 Property Tax
Rate 1.10 2.4 POTENTIAL TOTAL
INCREASED REVENUES 3,530,000 39,168,000 BUT
THIS is possible ONLY IF digital data is priced
LOW ENOUGH for BROAD USE.
38
PUBLIC INTEREST BENEFITS CONCLUSIONTOTAL
POTENTIAL INCREASED SALES AND PROPERTY TAX
REVENUE FROM BROAD PRIVATE SECTOR DIGITAL PARCEL
MAP DATABASES INCREASED TAX REVENUES
MONTEREY,CA DALLAS, TX
OPTIMIZED REAL ESTATE OPERATIONS INDUCED PROPERTY
TAX INCREASE 3,539400 39,168,000 LOWER
INSURANCE PREMIUM INDUCED SALES TAX INCREASE
2,415,120 12,925.440 LOWER UTILITY BILL INDUCED
SALES TAX INCREASE 1,455,000
12,177,000 IMPROVED BUILT ENVIRONMENT QUALITY
INDUCED PROPERTY TAX INCREASE 3,539400 39,168,0
00 OUT-OF-TOWN FINANCED DEVELOPMENT INDUCED
PROPERTY TAX INCREASE 3,539400 39,168,000 ANNUA
L TOTAL INCREASED TAX REVENUE INCREASE
14,488,000 142,600,000 TOTAL ASSESSED
PROPERTY VALUE (After About 5 years more
further out) 0.042 0.087
BUT ALL THIS is possible ONLY IF digital Parcel
Map data is priced LOW ENOUGH for BROAD USE.
39
CONCLUSION.
Whats in it for the Assessor? By adding Data
Management to your appraisal mission, not to
make money off the data, but to expedite its
BROAD USE, benefits the Assessor in two
ways o Increased Sales Tax Revenues o Increas
ed Property Tax Revenues
40
CONCLUSION.
This presentation has communicated to you the
sources and potential magnitude of future revenue
increases induced from BROAD USE of digital
parcel map databases. It is up to you to figure
out how to direct the portion you need to operate
the Assessors office in general and the Mapping
Division in particular. One thing is for certain,
BROAD USE of digital parcel map data is far more
interesting than CONSTRAINED USE.
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