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TABLE OF CONTENTS

Executive Summary

Chapter 1: Objectives, Scope, Methodology of the Audit

Chapter 2: Profiles of the Organization, Analysis of the

Organization Structure and Function

Chapter 3: Observations and Opinions

Chapter 4: Conclusions and Major Recommendations

Appendix

Executive Summary

This is a final report on a Management Audit of the Assessing Department within the City of
Nashua. This study was commissioned by Mayor Jim Donchess and was conducted from
November 2018 through February 2019 by Chief Financial Officer John Griffin and Chief of
Staff Kim Kleiner.

Specificatly, Mayor Donchess directed the:

° Review of written and unwritten policies and procedures which are in effect in the
Assessing Department and recommend any new or different policies and/or procedures which
should be adopted and/or put into operation.

° Review and evaluation of the policies, practices and procedures related to the
management of the Assessing Department and recommend improvements and changes.

° Review of the organizational structure and the staffing of the Assessing Department and
make any reorganization or restructuring recommendations which would benefit the
operations of the Assessing Department in particular and the City of Nashua as a whole.

Note: This audit was not intended to review the practices or procedures used by KRT
Appraisal, an independent contractor, who was responsible for performing the city’s most
recent Revaluation project. KRT Appraisal followed specific New Hampshire Department of
Revenue Administration, Municipal and Property Division rules and procedures to conduct the
Revaluation. Due to concerns regarding the efficiency and capacity of the internal assessing
department in early spring of 2018, the decision was made to recommend the hiring of an
experienced appraisal consultant to the Board of Aldermen.

The major findings of the management audit are:

1} Ineffective management of the Assessing Department

2) Lack of internal policies to guide operations

3) Disparate software systems utilized by the department are not optimized

4) A full measure and list of all properties within the City has not been conducted since the
early 1990s

Objectives, Scope, Methodology of the Audit

The scope of the Management Audit included the review of written and unwritten policies and
procedures; review and evaluation of the policies, practices and procedures related to the
management of the Assessing Department; and review of the organizational structure and the
staffing of the Assessing Department. The Management Audit was not intended to review
individual property cards and assessments, The statutory abatement rules and regulations
guide that process.

In conducting the audit, one on one meetings were held with all of the members of the
Assessing Department staff. The assessing calendar, internal procedures, various reports, and
internal and external software applications were also reviewed. The audit did include the
observation of updating AssessPRO records, review of various data contained within the
system and some practices used by assessing staff.

Meetings and consultations were also held with the principals of KRT Appraisal, Patriot
Properties and CDMSmith. KRT Appraisal most recently conducted the Revaluation. Patriot
Properties is the company that developed, installed and maintains AssessPRO, the Computer
Assisted Mass Appraisal (CAMA) system that contains all of the property records for the City.
CDMSmith has assisted the City of Nashua in the development of its GIS operations for over
two decades.

Profiles of the Organization, Analysis of the

Organizational Structure and Function

Analysis Approach:

The organizational analysis focuses on the functional effectiveness of the assessing
department’s office and management structure.

Several documents were reviewed for this analysis, including:
Department-level organizational chart (Appendix 1)
Organizational assessments completed by State DRA
Policies and administrative regulations
Department operational procedures
Job descriptions of all positions
Board of Assessor meeting minutes, agendas, and Board packets
Budget information
Interviews with all departmental staff (Appendix 2)

Consultation with Information Technology Staff

Consultation with Patriot Systems, KRT Appraisals and COMSmith

Departmental Functions as defined in city job descriptions:
Chief Assessor

Directs and participates in all activities related to the assessment of all property in the City. The incumbent
directs four appraisers and four technical clerical staff to provide assessment/appraisal services, exemption
and credit qualification, constituent services and public relations in the highest quality manner for the City.
This individual is also responsible for establishing and administering customer-responsive, cost effective and
high quality assessment standards and procedures that meet all applicable legal requirements.

e Accomplishes assessing staff results by communicating job expectations; planning, monitoring, and
appraising job results; coaching, counseling, and disciplining employees; initiating, coordinating, and
enforcing systems, policies, and procedures.

e Maintains staff by recruiting, selecting, orienting, and training employees; maintaining a safe and
secure work environment; developing personal growth opportunities.

e Maintains organization's effectiveness and efficiency by defining, detivering, and supporting strategic
plans for implementing best practices in assessing.

e Directs staff in the measuring, listing and valuation of property to maintain $8.5 B assessment roll.

« Promotes transparency in assessment practices and directs outreach and public information program
to educate the public and elected officials.

« Educates staff in the procedures and policies necessary to conform with state law as it pertains to the
assessment of property and application of exemptions and credits.

e Directs appeals and litigation for the local and state level abatement process.

e Recommends assessing strategies, policies, and procedures by evaluating organization outcomes;
identifying problems; evaluating trends; anticipating requirements.

e Accomplishes financial objectives by forecasting requirements; preparing an annual budget; scheduling
expenditures; analyzing variances; initiating corrective action.

e Maintains quality service by establishing and enforcing organization standards.

e Maintains professional and technical knowledge by attending educational workshops; reviewing
professional publications; establishing personal networks; benchmarking state-of-the-art practices;
participating in professional societies.

e Contributes to team effort by accomplishing related results as needed.

Assessor lil

e Field Work: Organizes information based on building permit activity and assignments from Chief
Assessor and Deputy Manager/Appraiser IV. Assists Chief Assessor/GIS Manager and Deputy
Manager/Appraiser IV in supervising data verification of all City properties.

e Assists in training of Appraisers and Data Collector.

e Drives to subject sites; draws detailed sketches and calculates square footage of property
improvements; performs interior inspections; records list of pertinent structural characteristics;
evaluates quality and condition of subject properties; determines models, styles, story heights,
records visit history, performs site inspections and evaluation of new lots and subdivisions.
Properties inspected include new construction, building permits, and current transfers.

¢ Valuation of Real Property: Calculates property values utilizing appraisal software; analyzes
market influence to surrounding neighborhoods of environmentally sensitive or impacted sites.
Estimates value utilizing income approach and mass appraisal techniques. Correlates value estimates
into logical conclusion and presents in orderly fashion utilizing ADMINS appraisal software and other
computer applications.

e Conducts research to include but is not limited to: Registry of Deeds, banks, brokers, buyers, sellers,
MLS, appraisers, etc. to establish ownership histories and determine validity of “arm’s length"
transactions.

Interviews taxpayers to determine condition of property at time of sale. Analyzes income statements
to determine trends in market and validity of reported income. Defines problem areas if inequitable
taxation; suggests corrective measures; implements corrective measures.

Abatements and Appraisals: Processes requests for abatement of taxes; researches and
evaluates concerns submitted by taxpayers; makes recommendations tothe Chief Assessor
Manager and the Board of Assessors whether or not to abate taxes based on complaints of
inaccurate measure and/or listing. Reviews comparable. sales, equitable valuation of similar
properties, appraisals, cost factors, and other pertinent valuation data. Appraises property as
necessary for defense of assessment (appraisals require thorough understanding of sales, cost and
income approach to value). Prepares and presents cases for Board of Tax and Land Appeals. Interfaces
with Chief Assessor/Administrative Specialist IIl/CSR, Legal/Planning/ Building/IT Division,
Taxpayers, Attorneys, Appraisers, Tax Representatives, Public:

« Answers questions; composes written correspondence; provides information regarding real
property; interprets property record cards; arranges appointments; collects and organizes
submitted data; answers telephone inquiries; reports to and updates Deputy Manager/Appraiser IV
on status of all projects.

e Prepares preliminary value estimates for internal planning purposes of the administration.

Appraiser Il

Performs assessment and appraisal of real property in accordance with pertinent legislation, code,
and ordinances.

Field Work: Organizes information based on building permit activity and assignments from Chief
Assessor/GIS Manager and the Deputy Manager/Appraiser IV. Assists Chief Assessor/GIS Manager and
the Deputy Manager/Appraiser IV in supervising data verification of all City properties.

Assists in training of Appraiser | and Data Collectors.

Drives to subject sites; draws detailed sketch and calculates square footage of property
improvements; performs interior inspections; records list of pertinent structural characteristics;
evaluates quality and condition of subject properties; determines models, styles, story heights,
records visit history, performs site inspections and evaluation of new lots and subdivisions.
Properties inspected include new construction, building permits, and current transfers.

Valuation of Property: Calculates property values utilizing computer software. Reviews base rates
and other cost factors used to maintain equitable assessments of properties; analyzes market
influence to surrounding neighborhoods of environmentally sensitive or impacted sites. Research:
Research includes but is not limited to: Registry of Deeds, banks, brokers, buyers, sellers, MLS,
appraisers, etc. to establish ownership histories and determine validity of "arm’s length" transactions;
interviews taxpayers at site to determine condition of property at time of sale; defines problem
areas of inequitable taxation; determines/suggests corrective measures; audits equitable
assessments through statistical testing and mathematical computations using ADMINS, spreadsheet
applications and other calculating devices.

Abatements and Appraisals: Processes requests for abatement of taxes; research and evaluates
concerns submitted by taxpayers; makes recommendations to the Chief Assessor/GIS Manager and the
Board of Assessors whether or not to abate taxes based on complaints of inaccurate measure and/or
listing. Reviews comparable sales, equitable valuation of similar properties, appraisals, cost factors

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and other pertinent valuation data. Appraises property as necessary for defense of assessment
(appraisals require thorough understanding of sales, cost and income approach to value).
Prepares and present cases for Board of Tax and Land Appeals. interfaces with Deputy
Manager/Appraiser |V and Chief Assessor/GIS Manager, Assessing Administrative Specialist III/CSR
Legal/Planning/ Building/IT Division, Taxpayers, Attorneys, Appraisers, Tax Representatives, Public:
Answers questions; composes written correspondence; provides information regarding real
property; interprets property record cards; arrange appointments; collect and organizes submitted
data; answer telephone inquiries; report to and update Chief Assessor/GIS Manager on status of
all projects.

Assists in preparation of proper forms for filing of taxpayer exemptions.

Assessment Processing: Analyzes subdivisions and combinations for resulting assessment
Change, processes religious and charitable exemptions, processes current use applications and
change of use penalties.

-

Appraiser |

s

Responsible for assessment and appraisal of real property in accordance with pertinent legislation,
codes, and ordinances.

Field Work - Measure and List: Drives to subject sites; draws detailed sketch and calculates
square footage of property improvements; performs interior inspections; records list of
pertinent structural characteristics; evaluates quality and condition of subject properties;
determines models, styles, story heights, records visit history, performs site inspections and
evaluation of new lots and subdivisions. Properties inspected include new construction, building
permits, and current transfers.

Valuation of Real Property: Calculates property values utilizing VMS-ADMINS and City computer
software. Performs data entry of property factors. Updates of assessments due to property changes.
Research and Ratio Studies: Research includes but is not limited to: Registry of Deeds, banks,
brokers, buyers, sellers, MLS, appraisers, etc. to establish ownership histories and determine validity of
“arm’s length" transactions; interviews taxpayers at site to determine condition of property at time
of sale; defines problem areas of inequitable taxation.

Abatements and Appraisals: Processes requests for abatement of taxes; research and evaluates
concerns submitted by taxpayers; makes recommendations to the Chief Assessor/GIS Manager and
the Board of Assessors whether or not to abate taxes based on complaints of inaccurate measure
and/or listing. Reviews comparable sales, equitable valuation of similar properties, appraisals, cost
factors and other pertinent valuation data. Appraises property as necessary for defense of
assessment (appraisals require thorough understanding of sales, cost and income approach to
value).

Interfaces with Deputy Manager/Appraiser IV and Chief Assessor/GIS Manager, Assessing
Administrative Specialist III/CSR, Legal/Planning/ Building/IT Division, Taxpayers, Attorneys,
Appraisers, Tax Representatives, and the Public.

Answers questions; composes written correspondence; provides information regarding real
Property; interprets property record cards; arranges appointments; collects and organizes
submitted data; answers telephone inquiries; reports to and updates Chief Assessor on status of all
projects.

Assists in preparation of proper forms for filing of taxpayer exemptions.

Assessing Admin Specialist Il/CSR

Responsible for providing the leadership, knowledge, supervisory abilities, and skills necessary to
oversee the data management and administrative functions of the Assessing Department and to
oversee and maintain a highly professional customer support function both over the counter and over
the telephone.

Assessing Department Data Management and Administration:

Supervises, prioritizes and delegates assessing administrative workload

Acts on and resolves administrative staff concerns/problems

Evaluates performance of Data Management/Administrative Team and writes appraisal reviews
Administers the requests and production of special reports regarding assessing system data
Produces generic City database and sales reports

Writes administrative procedures and maintains departmental procedures manual

Acts as liaison with IT Division regarding enhancements to the assessing computerized system
Supervises continued auditing of the exemption program

Supervises the processing and tracking of abatements

Supervises the administration of the yearly assessing update program

Assists in resolving budget preparation concerns

Reviews/approves weekly department payroll

Approves requests for purchase and maintenance of equipment

Supervises preparation of sales assessment sheets for Department of Revenue Administration
Participates in meetings with other departments to resolve inter-department issues

Resolves issues regarding the day to day administrative operations of the Assessing
Department

Coordinates the training and cross-training of the Administrative staff
e Customer Service/Support
Maintains a consistently high level of customer support at the service counter and on

the telephone through coordination of office coverage.

Provides personal and/or telephone assistance to taxpayers in resolving changes and/or
concerns associated with the City of Nashua Assessing Department programs

Provides information to taxpayers regarding State Statutes

Communicates with outside organizations regarding the City of Nashua's assessing program

Assists taxpayers in initiating applications/changes associated with exemptions/credit programs

Assessing Admin Specialist Il/CSR

Responsible for initiating new account setup, processing account maintenance, processing all plans,
quality control of deed transfers, providing information to GIS Technician, processing, maintaining and
auditing exemption files, data entry of prescribed information utilized in assessment
applications, research of abnormalities found in Assessing Department records, providing assistance
to taxpayers in person or on the telephone and providing backup to other Administrative Specialists
and Department Coordinator position.

Assessing Administration:

Processes account maintenance generated by the Appraisers and GIS Technician
Reviews plans for accuracy

Initiates new account setup

Performs quality control on deed transfers and address changes

Expedites routine Department tasks through the knowledge of office information, data
processing, storing, retrieving practices and procedures, and the use of standard office
equipment and equipment maintenance/troubleshooting

Initiates correspondence to taxpayers regarding new ownership and/or changes in sotar and
handicapped exemption status

Participates in resolving issues regarding the day-to-day operations of the Assessing
Department

Schedules, prioritizes, and manages workload
Maintains files of work done
Maintains document retrieval system

Utilizes Pictometry photos to locate changes to properties for which no building permit has
been issued

Performs data entry for Appraisers
Processes audits and maintains tax exemption and credit files

Prints building permits and property cards and organizes files by street/map designation so files
are ready to go for inspections by Appraisers for both residential and commercial building
permits

Enters Appraisers visit history and corresponding notes

Adds improvements (deck, sheds, additions, etc.) for all updated property from Appraiser's
visits
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Prints updated property card for file or Appraiser inspection

Draws detailed sketch and calculates square footage of property based on Appraiser's physical
inspection of property

Performs in-house inspection and/or examination of existing city record. Verifies data using
Uses pictometry and prints updated property card for fil

Tracks and records possible work being done without building permit. Periodically supplies
supervisor with updated list to notify Code Enforcement

Reviews paving on parcels in the City and makes adjustments to property record cards
Performs review of land adjustments due to access, location, etc.
Maintains and updates current use files

e Customer Service:

Provides personal and/or telephone assistance to taxpayers in resolving changes and/or
concerns associated with the City of Nashua Assessing Program

Provides information to taxpayers regarding NH State Statutes

Assessing Administration Specialist 1/CSR

Responsible for processing all deed transfers, initiating correspondence to taxpayers regarding new
ownership and/or changes in status, assisting taxpayers and others with all property inquiries at the
counter and on the telephone, and providing backup to other Administrative positions. Also
responsible for processing, maintaining, and auditing exemption files, data entry of prescribed
information utilized in assessment applications. After processing of initial application and analyzing
financial data submitted, responsible for recommendation of approval or denial of Exemption/Credit
application and notification by letter to taxpayer

Assessing Administration:

Prints and processes easements and deeds

Processes P-34

Interprets deed transfers for accuracy and legality

Reviews Appraiser Maps/GIS Maps for accuracy.

Initiates correspondence to taxpayers regarding new ownership and/or changes in status.
Processes "Notice to Towns and Cities" from the NH Superior Court

Corresponds with Taxpayers, Attorneys or Title Companies regarding errors on deeds.

Researches ownership issues with the Registry of Deeds and Superior Court/Probate
Department

Assists GIS Technician regarding accuracy of Appraiser Maps
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