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F I S C A L I M P A C T R E P O R T

SPONSOR Snyder

ORIGINAL DATE

LAST UPDATED

1/21/08

1/29/08 HB

SHORT TITLE Computer-Assisted Mass Appraisal System

SB 22/aSPAC

ANALYST Earnest

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$6,000.0 Non-recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Taxation and Revenue Department (TRD)

SUMMARY

Synopsis of Senate Public Affairs Committee Amendment

The SPAC amendment eliminates the reference to a ‘network’ of appraisal systems. The CAMA

systems will not be networked but instead will be able to exchange information in a common

language or system.

Synopsis of Original Bill

Senate Bill 22 appropriates $6 million from the general fund to Taxation and Revenue

Department for the Property Tax Division to establish a statewide network of computer-assisted

mass appraisal systems so that the systems are available to all county assessors and state

agencies needing access to the data and functions of that network.

FISCAL IMPLICATIONS

The appropriation of $6 million contained in this bill is a nonrecurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of fiscal year 2009 shall

revert to the general fund.

Senate Bill 22/aSPAC – Page

2

SIGNIFICANT ISSUES

According to TRD:

State law requires assessors to determine property values for tax purposes in accordance

with the Property Tax Code and update property values so that “current and correct"

property values (essentially market values subject to statutory limitations) are maintained.

The statute also requires the Taxation and Revenue Department’s Property Tax Division

(PTD) director to implement a program of evaluating county assessors' valuation

practices with emphasis on maintenance of current and correct values. Statutes require

this because inequities in assessment generate inequitable property tax obligations. As

discussed below, resources currently available to PTD, counties and various property tax

recipients (municipalities, counties, school districts and others) make compliance with the

law difficult. The proposed measure is intended to remedy this problem to some extent.

According to the Massachusetts Department of Revenue:

A computer-assisted mass appraisal (CAMA) system is an automated system for

maintaining property data, valuing property, notifying owners, and ensuring tax

equity through uniform valuations. Such systems were made possible by

computers and have grown rapidly in functionality and price performance with

improvements in computer hardware and software. CAMA systems were

developed on mainframe computers, but now are available on mini-computers and

PCs as well. CAMA systems can be designed to operate independently or on a

stand-alone basis or can be part of an automated network, with the ability to

interact electronically with other departments. There are four essential features of

a CAMA system: data management, valuation, performance analysis, and

administration. A good CAMA system will perform these functions in an

effective, easy to use manner.

TRD also reports:

Recent New Mexico population growth and its resulting public finance information needs

have made administering county assessment practices increasingly complex. In response to

the need for improved information, the New Mexico Association of Counties Assessor’s

Affiliate has asked for an appropriation of $6.0 million to equip twenty-four counties that

currently do not possess CAMA systems with these types of systems. This would allow all

counties to share information with a central system housed at the Taxation and Revenue

Department’s Property Tax Division.

•

The proposed improvements are to be implemented by the end of 2009. They would

allow the Property Tax Division to respond to property tax questions with greater

accuracy and speed than is possible under the current system.

•

A centralized CAMA system would also allow the Property Tax Division to monitor

assessment problems and assist counties before revenues are adversely affected.

•

The systems would allow assessors to track assessments and the extent that they reflect

market values simultaneously, and thus decrease inequities in assessed values and tax

obligations.

•

Improving assessments would increase the property tax base, take pressure off tax rates

and increase bonding capacity. Currently twenty-one counties have reached their

Senate Bill 22/aSPAC – Page

3

operating rate capacity, and several school districts have reached their bonding capacity.

•

The proposed systems would reduce administrative costs at the county level by allowing

assessors to implement changes in statutes, regulations or PTD Orders without revamping

their entire operations.

•

Statewide use of CAMA systems would automate the tax roll certification process and

contribute to the speed and accuracy of tax rate calculation.

•

A program of this type that centralized election procedures was implemented successfully

by the county clerk’s offices and the Secretary of State.

The Association of Counties reports that a CAMA would improve the uniformity of assessments,

reduce reappraisal cycles, stabilize the cost of administration, and make available more

information for “appraisal work, taxpayers, TRD, DFA, supporting appeals, state legislators, or

any other sector, public or private.

PERFORMANCE IMPLICATIONS

For FY09, TRD will begin reporting quarterly on the percent of counties in compliance with the

sales ratio standard of 85 percent of assessed value to market value.

ADMINISTRATIVE IMPLICATIONS

TRD finds that implementation of a CAMA system would substantially improve administration

of New Mexico’s property tax system.

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