Three years after many Portland homeowners saw a big jump in their property taxes, the city is again beginning a revaluation process that could mean another increase for some – though the city expects it to be less extreme than before.

Christine McHale, 71, has lived in the West End for 35 years. She was able to buy a home in the neighborhood 10 years ago. During the last revaluation in 2021, her property taxes went up by more than $1,000 – to $7,500 a year.

“That was a real stab in the heart,” McHale said. “Then to find they’re going to revalue again, meaning, I assume, my taxes will go up even more. All of my neighbors are in the same boat. We’re all retired and on fixed incomes. It’s not like I can get a second job. So I don’t know where the money will come from.”

McHale loves her home and never wants to move out of Portland, but she’s nervous that she’s going to get a bill she can’t pay.

But this time around, the city’s assessor says, property values are unlikely to change so drastically.

That’s because it’s only been a few years, said Elisa Marr, the tax assessor for Portland. When the city went through this process in 2021, it had been 15 years since a reassessment. And with big upward swings in the real estate market during that time, it meant homes had been undervalued for years.

Revaluations don’t generate additional revenue – they only redistribute the property tax burden. Homes with major renovations will be given a higher value, and therefore a higher tax bill, while owners of homes that have lost value over time will pay less.

Though Marr said it’s too early in the process to know how new values will shake out, she said most residents will see their value and their property taxes go up at least a little bit, though some values will stay the same or decrease.

“The market has changed every year since this was last done in 2021, so we’re back where there are some inequities that evidently need to be addressed,” Marr said.

Portland has seen significant growth in its real estate market over the past decade. An influx of new residents, rising demand for housing and limited inventory have driven property values higher.

The average assessed value of a home in Portland (condominiums, two-, three- and four-family homes) is $440,800, Marr said. In Cumberland County, the median sale price for a home reached $580,000 this spring, a 6.5% increase over the same period last year.

“The city has been experiencing tremendous growth in the real estate market; it’s been thriving. And property taxes pay for municipal services, so we need to make sure those are being drawn fairly,” Marr said.

DISASTROUS PRECEDENT

Across southern Maine, other cities are feeling the same pressure.

In South Portland and Brunswick, recent property revaluations sparked outrage – to the point that Brunswick, delayed its revaluation process last year.

Some homeowners in Brunswick were facing tax hikes of 100% or more, while other property owners saw decreases. Town officials were inundated with phone calls, emails and public comments at meetings from residents scared that they wouldn’t be able to afford the steep tax hikes.

In South Portland, new tax bills from last year’s revaluation have just landed in people’s mailboxes. Homeowners expressed their frustration and fears at a South Portland City Council meeting this month.

Millie Pelletier broke down in tears while speaking to the council about the 60% increase she saw after her home was appraised at $375,000, up from its previous valuation of $177,000.

“My house has been in my family 100 years next month. Today is my mother’s birthday; she was born in the house. I took the house over – it needed a lot of work – hoping to save it, and now I’m afraid I’m the one who is going to lose it,” she said.

Pelletier said she was confused about the process – she hadn’t made any major renovations when she appealed her new value, even the assessor was confused as to why her taxes spiked so sharply.

Donna Kane also spoke at the council meeting. She said she is no stranger to tax increases, as she’s owned her home in South Portland for decades. But when she got her bill this year, “I was absolutely flabbergasted,” she told the council.

Her bill had gone up 40%, and she said she was concerned something had gone wrong.

“I served 30 years in municipal government. I understand how property taxes work … but I have never seen anything like this,” she said.

Kane asked the council to investigate the assessment process.

South Portland’s assessor, Brent Martin, has tried to reassure residents, saying that the more often these revaluations happen, the less painful they become.

“The market has pretty much been on a tear,” Martin said. “An assessing office ideally would like to be able to make more incremental adjustments. We got a little bit behind on things and it became necessary to get caught up.”

THE PROCESS

Municipalities are legally required to make assessments whenever the ratio of market sales to assessed value changes. So, a city that isn’t regularly conducting revaluations isn’t complying with that law, said Marr, Portland’s assessor, because the market changes so frequently.

To keep up with those fluctuations and lessen the impact of reassessments, the Portland City Council passed a nonbinding resolution in 2021 that the city should conduct revaluations every five years. That means the city needed to get started this year to complete the yearlong process.

In July, the city sent out paperwork to property owners asking them to review the information on file about their properties and to notify the city if anything is incorrect or needs to be updated.

“If you built a new garage or did a major remodel, we’d want to know about that,” Marr said.

Then, assessors will analyze the real estate market, examining trends in property sales and pricing, and use that to assign property values.

By April, property owners should expect to receive a letter with their new valuation, which can be appealed before tax bills are sent out in August.

Marr said her office has tried to put out as much information as possible so property owners aren’t blindsided by their new values when the tax bills are sent out. She hopes the new property valuations won’t cause backlash like they did in South Portland and Brunswick. The process is still in its early stages, but she said so far people have been very cooperative.

“My goal is that property owners will be happy with their new values in the sense that they will feel they are fair and equitable,” Marr said. “The reason your value might go up significantly is if you made big changes to your home or if you were underassessed last time.”

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