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Assessing the Tax Assessor
By Kim J. Gifford
Photos by Paul Howe
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 "Let’s talk” is not a phrase one generally associates with a tax assessor, yet this is exactly the message Normand Bernaiche — the new joint tax assessor for the three towns of Sunapee, Newbury and New London — is advocating to Lake Sunapee region residents.
The Challenge of Lakefront Property
In May, the three towns decided to share full-time assessing staff and associated costs instead of paying large sums of money to contract assessors and lawyers. Bernaiche, the former tax assessor for Lebanon, assumed his novel position in September.
Although all three towns border Lake Sunapee, disproportionate assessments often arose from wide gaps in time between revaluations. “The old standard was revaluation every 10 years, but the real estate market is pretty dynamic,” says Bernaiche. “To just update assessments every 10 years leaves a lot of years in between where you have disproportionate assessments — and the whole premise of the system is to have proportionate assessments from one taxpayer class to the next, and one taxpayer to the next.”
One of the primary challenges in the Lake Sunapee region is the large percentage of lakefront property. Lakefront properties, typically owned by seasonal part-timers and the wealthy, comprise at least half of each of the three communities.
“Generally your stable tax base is your residential properties, your main homes because everyone needs a place to live. What tends to change a lot is commercial properties, seasonal properties or lakefront properties. In Lebanon, the issue was commercial versus residential. Here, it is lakefront versus nonlakefront,” explains Bernaiche. “Statistically speaking, let’s say you have 150 sales in a community a year. The state equalizes your value every year based on these bonafide transactions. Say 120 or 130 are nonlakefront sales. If these properties are increasing in value and the lakefront aren’t, you tend to overestimate this part of your tax base.”
Debunking the Myths
Bernaiche hopes to improve this process in a number of ways. For example, he plans to inspect sales on a monthly basis to ensure accuracy. “These become our control group for accurately valuing all the rest of the property in a community,” he says. Although many people have the misconception that inspections drive changes in value, Bernaiche sees two aspects to the process — inspection and valuation. Inspection verifies the accuracy of the information while valuation keeps track of market changes.
Bernaiche also plans to notify owners immediately if their property value changes. In the past, if renovations to a property changed its value the owner had to wait until the property tax bill arrived to find out. The new system will allow the owner a chance to discuss concerns sooner rather than later.
“We’re trying to be proactive, helping people better understand their assessment and how and why we came up with it,” says Dennis Pavlicek, town administrator for Newbury.
“We are trying to take the mystery out of the process,” says Bernaiche, who is meeting with townspeople at their homes to talk about their assessments rather that at his office. “We’re going to their turf in the hopes that they’ll feel a little bit more comfortable and realize we are not trying to overpower them or intimidate them. Some people around the lake pay $50,000 a year in taxes. They deserve some professional treatment,” he says.
Bernaiche, however, is extending this level of customer service to all residents. “He’s made a point of scheduling hour-long meetings with property owners who have concerns about their assessments compared to the 15-minute meetings which property owners received after the last revaluation,” says Jessie Levine, New London’s town administrator. “He really sees customer service as being the primary function of the assessors. The assessing has to be accurate and it has to be timely, but it’s the communication part of it that he strives to do as well.”
In Bernaiche’s opinion, two of the fundamental myths about assessors are that they manufacture the numbers placed on a property out of the air and that they are unapproachable. He answers the first by pointing out that assessors use historical market data based on the actions of buyers and sellers to develop the values. “We do not create value, we only analyze what has taken place,” he says. “The business of valuing property is such a moving target — it actually feels good when you get it right. We are trying to put some science and math to something that is very emotional and very unscientific. That is the challenge we face every day and, in the case of these three towns, we’re doing it for 9,000 parcels at a value of $3 billion.”
As far as being approachable, he notes, “We can tell you where we’re coming from and you can tell us where we’re wrong and we’re not going to be offended by that. Tax assessors are human and we are approachable. We listen and we are fair. It is a difficult job and we try to perform it to the best of our abilities.”
“Following a town-wide revaluation it is a pleasure to get phone calls from taxpayers who are praising the service they got from Norm in response to a bonafide mistake from the revaluation,” says Donna Nashawaty, Sunapee town manager. “When they call they are careful to explain that Norm didn’t just give them a new value but explained in English what their valuation was based on, and they are very grateful for this service.”
Bernaiche’s Background
 Bernaiche may be the perfect man for the task. He comes to his new job with experience handling complex assessments, having spent 12 years in Lebanon appraising both residential and commercial properties including Timken Aerospace, Stryker Bio-Tech and Dartmouth-Hitchcock Medical Center (DHMC). In 1998, he was part of a historic battle between the city of Lebanon and DHMC when the city revoked the medical center’s property tax exemption, claiming the nonprofit did not provide enough charitable service. In 2002, the conflict came to its conclusion with DHMC agreeing to pay $26 million to retain its exemption. Bernaiche counts this among his most important accomplishments. “This was a historical agreement,” he says.
Bernaiche has previous experience with waterfront property and valuing expensive and elaborate homes including those in Westport, Conn., home to Paul Newman, Rodney Dangerfield and David Letterman. “I’ve done houses with bowling alleys and ‘Gone with the Wind’ type staircases going up to the wings,” he says.
Following his graduation in 1983 from Central Maine Vocational Technical Institute in Auburn, Maine, Bernaiche went to work for a mass appraisal company doing a revaluation in Wells. “I spent my first summer working on the beach measuring houses,” he says.
He then moved to Westport where he worked for another mass appraisal company. His work and the beauty of New Hampshire eventually drew him to Claremont where he conducted a revaluation, becoming an assessor there for three years. Following this, he went to work in Lebanon.
Assessing the New Assessor
Part of the appeal of his new job lies in the challenge. “Kathy Valentine, my clerk in Lebanon, said to me, ‘You wanted this job because you wanted the challenge. You didn’t have any more in Lebanon.’ I think the challenge is part of human nature, the goal of getting it right,” Bernaiche says.
Not only is Bernaiche facing three communities that have been through several years of court challenges, taxpayer dissatisfaction and inconsistent assessments, but he must also learn to work with three town managers, three boards of selectmen and a joint board that oversees this tri-town process. “If that’s not a challenge, then I don’t know what is,” he says.
So far, Bernaiche is rising to the occasion. “I’m not getting any complaints which is a good sign,” says Pavlicek. “The job of a town assessor is not always the easiest job. A lot of times you’re not making friends, but Norm has a way with people.”
“Professionally, his work is stellar,” agrees Levine. “In six weeks he completed a statistical update for the town of New London that would have cost $30,000 to $60,000 had we contracted with anybody outside. He cares about his work product and he also cares about providing customer service.”
Kim J. Gifford is a freelance writer from Bethel, Vt. In her 13 years as a working writer, she has covered topics on just about everything you could imagine, including the kitchen sink, literally! When she’s not out on assignment, Kim is likely to be found teaching memoir writing at Lebanon College or catering to her precocious pugs, Buffy and Vader.
Why Assess?
In 2001, the state Supreme Court ruled that towns within New Hampshire must do a full property revaluation at least every five years to ensure “that tax assessments, the value placed on a property for the purpose of taxation, are at 100 percent of market value at least every fifth year,” says Donna Nashawaty, Sunapee town manager. “In addition, the Supreme Court dictated that in all other years property must be proportional with one another.”
The goal of revaluation is to ensure that property owners carry their share of the tax burden based on the assessed value of their properties. Fluctuations in the real estate market may lead towns to either over or under assess the full value of a property. Yet, if the properties within the town are assessed proportionately, at the same percent of the market value, there is no concern.
“Once the assessment is established, we turn the numbers over to the state of New Hampshire and they calculate a total tax rate based on the four pieces of the pie — state education tax, local school tax, county tax and municipal tax. Then the tax collector uses the individual assessments times the total rate to calculate a payment for each property,” says Normand Bernaiche, the joint tax assessor for Sunapee, Newbury and New London.
The state conducts its own equalization process to make necessary adjustments to ensure proportionality between towns on a statewide basis. Prior to 2001, many towns in the state had not conducted revaluations in 10 years or more. When there is such a wide gap between revaluations, large shifts in value are more likely to occur, startling property owners. Presently, “the valuations are not bad at all. All towns were done fairly recently and the data is pretty good,” says Bernaiche. “The problem the towns are addressing is the fact that they shouldn’t wait 10 to 15 years to update values.”
Newbury was last assessed in 2003. New London was assessed in 2003 and again in 2005, and Sunapee also recently completed an assessment in 2005.
“When you do not adjust value on a regular basis the equalization process, state law does it for you. If nonwaterfront property is appreciating at a higher rate you tend to overinflate the relative worth of your community, thus, paying a larger proportionate share of the district’s budget,” says Bernaiche.
Nashawaty noted that the new valuations might mean less to the taxpayer than they do to the state. “The state has determined that we have to be within 10 basis points of 100 percent. They will order towns to do a revaluation, hire a company and send you the bill. In doing our own revaluations we have some control in making sure the population is notified and complaints are followed up and those sorts of things,” she says.
Although Bernaiche’s work will not relieve everyone’s angst and some property owners are still likely to dispute the results, he hopes the new valuations will result in residents more closely “paying their fair share based on the value of their property — no more, no less.”
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