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Special Bd. of Aldermen — 11/26/2018 Page 5

wanted to see how that was doing. So often when you have data and it is moved from a variety of different
software systems, the more systems that data is being flown through or entered into manually, the more areas
that you may have room for error.

What we saw is there were a number of software systems that were still being used within the City even after
we had bought and implemented Patriot Systems and now we have bought and implemented MUNIS. Older
systems that really can be eliminated and should, and we recommended should be at this point. So that was
quite a process working through all those systems, seeing how those systems worked. We then sat with
individual assessors and walked through how they work through their day and what they see and how they walk
through an assessment on the system, the AssessPro System. We then looked at how the public may view
their individual property cards. So we have a system that is on our web site and we looked at how that flowed
and what does that look like and is that giving the same information and can that be done more effectively and
more transparently. So we reviewed those systems as well.

We then started to come up with what we saw as some of our observations during both the organizational,
meaning the employee part of the audit, as well as the policy review, as well as the information system review.
Those you can find on Page 18, I'll speak to just a couple of them and then let Mr. Griffin fill in. The Assessing
Department itself works on two different major functions; you have the administrative staff that deals with the
abatements and the exemptions and customer service. Then you have the assessors which are both residential
and commercial. What we saw was that they really operated quite independently of each other; there was no
staff meetings or organizational meetings where they all came together to share information although it is one
process. So that was one of our areas where we started to look at whether they are actually sharing information
effectively within the Department. We didn’t feel that was being done the best way that it possibly could.

Generally it was much better for efficiency purposes if anyone within the function should have some knowledge
of what others are doing; and especially how it affects what they are doing. So we didn’t feel that knowledge
was there within the Department. They also had some limited communication amongst each other. They didn’t,
although they were aware of the overall departmental mission, individual objectives and functions they seemed
to operate quite independently. There didn’t seem, and you'll see in the questions, a good set of the questions
is about ways to improve. So generally you look at an organization and is there some way that they are sharing
internally improvements and ways to improve. So generally you look to your staff that are performing functions
on ways to improve their function and we didn’t really see that that was happening. Of course the staff meetings
weren't happening so there was some lack of communication there and they weren’t really looking as to ways
that they could improve not only their function, but the functionality of the department.

There was some absence of internal policies, absence of internal training, they were sending people to State
trainings which is very good but internally, they were not training. And when you are looking to have an
organization and making sure that they are all dealing with the same objectives, you would normally see some
internal training amongst the Department. So part of the policy part that | want to speak to tonight is we at the
same time that we were conducting this audit, there had been a Committee formed to look at policies throughout
the City and that consists of CFO Griffin, myself, Director Budreau and Counsel Dory Clark. We had begun
already looking at policies. So one of the policies that we saw before we had even started the audit was the
mileage reimbursement and you will see that noted in the audit report. We have actually come up with a policy
for that, we meet again tomorrow and then we expect to bring that forward to the Mayor. That was not
something that was just to this Department. We had already discovered that we needed to have a policy that
handled all of our staff that uses their personal vehicles. I'll let CFO Griffin see if there is anything from here that
| have forgotten.

John Griffin, CFO

Thank you Ms. Kleiner, thank you for allowing us to come before you. A couple of things leveraging off what
Mayor Donchess said, we are expected to file a USPAP Manual, which is about 4 % inches thick, 700 pages
tomorrow, basically recapping all of the things that went into the revaluation. That’s a document that is required

Special Bd. of Aldermen — 11/26/2018 Page 6

by the State Department of Revenue Administration and how it will go is this; we will submit it, KRT will bring it
to the folks at DRA in Concord tomorrow, they will have a four to six week period to review, make any
suggestions to KRT who are the author of that document. Then we will get that document delivered. We had a
meeting with the Board of Assessors today and that document | look at as very critical to us moving forward in
that | firmly believe that we could have a public/private meeting where KRT would come in and explain, not all
700 pages of course, but explain their methodology because a lot of the good questions that have been asked
by a lot of different people in this proceeding is things like use of effective year built. That’s basically the key
ingredient to recapturing depreciation; use of MLS data, sales data, qualified sales data versus non-qualified.

As the Mayor indicated, we’ve got a veteran staff in the Assessing Department and they’ve been trained over
the course of time and they use these tools the way they’ve been trained. So there is probably an opportunity to
leverage off the knowledge of the KRT team and make some changes on kind of the nuts and bolts of how you
calculate assessments. But what Ms. Kleiner and | came up with was kind of a notion that on the assessing
side, we have kind of offloaded that to the State level. So when | figured out what the training was, it is more
keeping up with typical State training which is getting familiar with code changes, State Laws, etc. The
assumption is, is that by looking at the, and it is very difficult for me to look at it but the USPAP Manual, not the
one | just described but the one that guides the conduct of assessors, it is quite complicated. So there is an
International Association of Assessing Officials that basically sponsor that book and it is an international book.

| think | would just like to say that that report that we are anxiously awaiting for, | think that is going to shed a lot
of light on how things are conducted. The other thing | recommended and you'll see it in the recommendations
is we’ve got kind of a complicated way of describing things to people; whether it is effective year build, cost
doesn’t equal value; value doesn’t equal cost and also confused a little bit by building permit data where an
individual who pulls a building permit isn’t really bound to bring in the work order or the quote from the builder or
the contractor. So l’m not sure we’ve got a tight grip, | am not criticizing any departments, I’m not sure that we
have a system in place, at least on the assessing side to basically challenge values that have been put on
building permits. The other thing is we are really struggling with the ability to get into a house even when they
pull the building permit but certainly if they don’t pull a building permit, we may not know they’ve ever done
anything. So as the Mayor indicated, the full measure and list hasn’t been done since 1992 but started earlier
than that. But great questions this morning if you can only get into 30% of the houses is that good enough and
our expert KRT says that is the reality of the business we are in, but it worthy of a shot to at least update as
many cards as we can.

These cards, if you think about it, these property cards of almost 28,000 parcels, they’ve been ebbed and
flowed over decades of building permits, revaluations, changes and as the Mayor indicated, one of our team
members through pictometry, we can look with a fly over, we can look to see at least on the outside what has
been added and we’ve done a great job of capturing value in there, whether it be a deck, swimming pool, a filled
in swimming pool to subtract, etc. So | think that is the thoughts that | have with regard to how we move
forward.

Another touching point on the software, Ms. Kleiner and | brought all the team in, assessors, IT, GIS, etc and
we’ve kind of cobbled together a bunch of disparate software systems and just to shed some light on that — the
Admin System was run on what was called the VACS, so if you remember Digital Equipment Corporation, they
created the VACS, software ran on it. And | remember in that time period, | think it was like everybody is your
own programmer. Fortunately we have one person in the office, IT that knows how to program Admins. So if
you recall, 2 years ago, we went to MUNIS Tax Billing. We kept Admins as the link between AssessPro and
MUNIS. We need, as Ms. Kleiner says, we need to use the horsepower of Assess Pro which was installed in
2005, created in 2000. There certainly have been upgrades but the Patriot Property President doesn’t push us
on it but we have to more effectively use that for abatements, exemptions and credits, things of that nature
because that should be a direct feed through the MUNIS which basically all the software that we have both
Lawson and MUNIS there are upload capability through Excel. So I’m not saying we are going to be able to
feed from Admins into MUNIS but we can at least eliminate the Admins function. And that’s where Ms. Kleiner

Special Bd. of Aldermen — 11/26/2018 Page 7

was talking about dual entry; if we put the abatements in Admins and we put the abatements in the AssessPro
we are constantly trying to make sure and validate that both systems have the same data.

So these were kind of the obvious things but | guess one final point is the Administrative Services Director, the
Mayor did a certain amount of research but | did some as well. That was really the directorship glue that kept
these departments together and GIS used to be and is still fully integrated with Assessing but GIS, Assessing,
IT, those folks have to work together under one directorship would make sense. We have actually a pretty
extensive and expansive GIS system and we are going to expand that over to the Department of Public Works
for their, they will have their own unique fly over that helps them. But we do have gentleman from CDM Smith
who is an expert in all of these systems; whether it be GIS, Assessing, AssessPro so we are expecting that
report very soon. So it is kind of with that outlook that we are able to take the folks that we have, use these
reports, as the Mayor said, potentially subcontract for the horsepower of the assessing community. We are
optimistic that over a short period of time we will really amp up, but by 2 or 3 years from now, will a full measure
and list, and the changes we can make in the creation of assessments | think will serve us well going forward. It
is kind of a re-set that probably took place back in 1992, 2005, etc. So thank you for your time. | don’t know if
you have anything more on that but we are free for questions at this point.

Ms. Kleiner

So | would only add that | want to go back to something that the Mayor pointed out. Our assessing staff was
very polite, very patient during this process. This can be a very difficult process for staff to go through. There
were a lot of questions so imagining everything that you do on a daily basis is being questioned and you are
being asked why, why you do everything that you are doing. That can be difficult for staff to go through. They
were always very professional, always very polite, always very welcoming to us and | think that speaks to their
quality. They were very open and have been continued to be both CFO Griffin and | have been down there
almost every day since the audit, we are working with them, we are still asking questions and they continue to
be very helpful. So | want to make sure that is said for.

President Wilshire
Questions from the Board?
Alderman Dowd

Yes the question | have is administration asking for any actions taken by the Board of Aldermen this evening or
in the near future?

Mayor Donchess

Well the two things you will receive, not tonight, the things you will receive Tuesday the 12", are of course the
budget which will include some of these changes. The two principal ones being the creation of a new position
and the elimination of another within the budget. Number Two, there will be an Ordinance that will come in
which would re-establish the Administrative Services Director Position under basically the same, there are a
couple minor little word changes, but it is the same language basically that existed when the Administrative
Services Position in the decades that it is existed which was removed when the position was eliminated. So the
proposal would be to return that language into the ordinances and restore the position. But to do that, of
course, the Board of Aldermen would need to act affirmatively and also would need to act affirmatively on these
sections of the budget to implement it from a budgetary standpoint.

Alderman Klee

| have a couple of questions thank you. My first question is going to be about the permits that don’t happen
within the assessing office they happen in another department where someone pulls a permit and then it is

Special Bd. of Aldermen — 11/26/2018 Page 8

done. | remember when | spoke to you it was basically | think they told me that it was a click of a button and the
information went to you. Would this permit fall into this new admin services or will it stay where it is?

Ms. Kleiner

So permits is in Buildings which is under Community Development. Interestingly enough there is a new
software that is being brought into the City for all of our permitting functions that project is under IT. It includes a
variety of different departments that are working on that project. Buildings would stay with Community
Development although | think there needs to be a lot more discussion between IT, Assessing, Buildings, DPW
on this process as we look forward to implementing the new software. So software implementation sometimes
can be difficult. And if you don’t have the right people at the table discussing it and the right divisions giving
input it can go very wrong. It can also go wrong if you don’t have proper training after. So if you haven’t built
enough money into your budget to have the proper training of staff later, then you are going to encounter
problems. So one of the recommendations that you'll see if a lot about training in this audit. That is very
important, we want to bring Patriot back in. It is hard to say what type of training our assessing staff went
through when we implemented Patriot, but we need to start at the very beginning. So | think you will see a lot of
training when the new permitting system is brought in and hopefully you will see a lot more integration of ideas
and information under the one administrator.

Alderman Klee

And | can understand that, | worked as an IT Specialist so | know that implementing and training and people’s
anxiety of just having to change the way they are doing a system so | do understand that. | just have two more
questions really, and one is about the bringing up a new system. Who will be responsible for the data transfer
from one system to another? Will we be bringing in a contractor or will our IT Department do it? | know when
you have different systems and are trying merge, you don’t always have the same data fields. So we have to
marry those and match them up. Will we be doing that internally or will there be an external person coming in to
do something like that.

Ms. Kleiner

So | want to be very clear, this is an audit report which gives you a lot of recommendations. This is not an
improvement plan and those issues certainly have to be worked out. CFO Griffin and | have already started to
do some investigation but you’d want to see an improvement plan that is detailed and brought to you separate
from this and | think that is one question that would need to be answered. Who do we rely on for such and how
much consulting do we need to bring in, those sort of questions would be answered in the improvement plan.

Alderman Klee

| had only asked because you had talked about going from the Admin System to the MUNIS System so that was
the reason why | asked that one. I'll make this my last question and it goes to the full measure and list and
maybe you can’t answer this, maybe this is more a general question. | know we spoke earlier also about the
30%, if the 70% no you are not coming in. | can tell you, I’ve gotten calls from constituents who have said no
one is coming in my house. What do we do then? How do we do that assessment? Do we know?

Mayor Donchess

Well New Hampshire Law does not give us the authority to insist on going in. Attorney Bolton can express
somewhat of a qualification of that, under certain circumstances that he can describe it could happen, but
generally speaking when someone says no or you can’t them, they are never home, that’s the most you can do.

gen) THE CITY OF NASHUA ‘The Cate City”

Financial Services

Purchasiae Departotent

March 31, 2016
Memo #16-123

TO: MAYOR DONCHESS
FINANCE COMMITTEE

SUBJECT: AMHERST STREET IMPROVEMENTS — CHARRON AVENUE TO DIESEL ROAD
(VALUE: $1,537,096)
DEPARTMENT: 160 ADMIN/ENGINEERING; FUND: BOND & CONTRIBUTIONS
ACTIVITY: AMHERST STREET ROAD & TRAFFIC IMPROVEMENTS ($1,392,477)
DEPARTMENT: 160 ADMIN/ENGINEERING, FUND: TRUST
ACCOUNT CATEGORY: 61 SUPPLIES & MATERIALS ($69,619)
DEPARTMENT: 161 STREET; FUND: GENERAL
ACTIVITY: PAVING ($75,000)

Please see the attached communication from Steven Dookran, P.E., City Engineer, dated March 24, 2016
for information related to this purchase.

Pursuant to § 5-78 Major purchases (greater than $10,000) A. All supplies and contractual services,
except as otherwise provided herein, when the estimated cost thereof shall exceed $10,000 shall be
purchased by formal, written contract from the lowest responsible bidder, after due notice inviting bids.

RFP0851-121715 was sent to 19 potential vendors. 4 vendors attended the Mandatory Pre-Bid Meeting
on held at 12/1/16 at 1:00PM. Two (2) bids were received and opened on December 18, 2015 with
summary results shown below:

Continental Paving, Inc. Londonderry, NH Base Bid- $1,561,475 night closures
Alt 1- $1,397,360 day & night closures
Brox Industries, Inc, Dracut, MA $1,376,465

The City Engineer, Board of Public Works (March 24, 2016) and the Purchasing Department recommend
the award of this contract to Continental Paving, Inc. of Londonderry, NH in an amount of $1,537,096.

Respectfully,

Dan Kooken
Purchasing Manager

Ce: S. Dookran L. Fauteux

229 Main Street « Nashua, New Hampshire 03061 * Phone (603) 589-3330 « Fax (603) 589-3344

Special Bd. of Aldermen — 11/26/2018 Page 9

Steven Bolton, Corporation Counsel

Previously about 15 years ago, the law provided that if a tax payer refused entry to his or her property they lost
their right to seek an abatement. Legislature, in its infinite wisdom changed that law and now there is no
disincentive provided to effectively stonewall the municipality. There is a procedure an instrument that one
seeks that is called an Administrative Search Warrant. And like other search warrants, it gets issued by a judge
and it has to be based upon reasonable suspicion that municipal, that there is something untoward going on,
building without a permit, housing code violations, zoning violation, something like that or that it is part of an
extensive program to search out either those sorts of violations or for tax assessment purposes.

| question whether that is entirely consistent with the 4" Amendment but it is not unreasonable to say you want
to look at the interior structure of property that you are trying to assess for tax purposes. | have no doubt that if
we get reports that seem credible that — Hey | was in my neighbor’s house and they’ve got a finished basement
and | don’t have a finished basement and yet my house is assess for more than their house. We go over, we
look at the house from the outside, we see that they’ve got curtains hanging in the basement windows which
you can detect from the outside, maybe | can go in and get an Administrative Search Warrant to get us in that
house to see if they’ve got a finished basement. Maybe in the course, and it is a big maybe, in the course of a
full measure and list, | can get Administrative Search Warrants more extensively than that. And | am willing to
try but there is absolutely no guarantee.

Now for those of you in the Legislature, if you want to give us some assistance here, that would be welcome.
The old system had a degree of fairness to it, that if you weren’t going to cooperate, we weren’t going to
cooperate with you. So food for thought.

Alderman Klee

This is the year to do it.

President Wilshire

All set Alderman Klee?

Alderman Klee

| am thank you very much.

Alderman O’Brien

Yes thank you. When | glossed over this | saw a lot of problems and my previous life on the fire department
after | watched the original Back to the Future, they taught me the Admin System, you know the VACs and
everything and | was wondering if we could save some money in selling it to the Smithsonian. We are probably
the only City to still use it. But when you have a choke collar on your dog you aren’t going to, such restraints
from upgrading through the tax base, you get into these fall behind situations and | understand. But you get a
program to work with this because I’ve rolled through the Lawson years when that was brought in and
everything and they don’t fit tight and this and it’s like buying baggy pants sometimes.

But the thing is, with this report, because | know we are going to look at this in the future and | am wondering
farther down the line, | see that the Smith Company CDM Smith is going to report back relatively soon, late

March into April. Maybe some of their recommendations would be recommendations on programming is that
correct? And that is going to be affecting perhaps maybe this year’s budget in a way correct?

Special Bd. of Aldermen — 11/26/2018 Page 10
Ms. Kleiner

So we have asked CDM Smith for lack of a better term to “look under the hood’ of all the systems and let us
know and yes you are correct Alderman O’Brien. When you have a bunch of canned systems, you buy a lot of
canned systems, quite often people don’t really assess whether they can speak to each other effectively. That
is one of the questions that we have asked them to look at. Can these systems speak to each other, can they
speak to each effectively. They have let us know and in the course of this audit, CFO Griffin and | spoke with
Patriot, we had some good discussions and there are some communities that deal with Patriot, speaking directly
to MUNIS so there is a lot more work to investigate that and how we make that happen. So there are some
positive steps that we’ve found in this process, but | think you are going to see a lot more out of the report from
CDM Smith.

Alderman O’Brien

Follow up if | may — because | know a lot of this information has extra purposes too and | know this is not what
we are here to discuss tonight. But in looking at this CDM Smith coming in, it goes all the way to Police and Fire
Dispatchers as well too on how that comes up in 911 operation when the GIS and everything is working in
unison together. So CDM Smith they are going to look at the whole City | kind of hope to try to come up with
something that’s going to be the best that we can afford? Beautiful.

Alderwoman Kelly

Thank you. My questions are around the full measure and list. | am interested if we could go over what the
goals of that would be and what that would actually uncover or speak to in terms of the things we have
uncovered and then | have a couple of follow ups.

Mayor Donchess

Well maybe | can give a general answer and then if I’m off in any way | can be corrected. No one has sought to
go into all of the properties since 1991. Now certainly assessors have gone into properties when there is a
building permit or under other circumstances, but no one has sought to go inside all of the properties since
1992. And what this would do is potentially where assessors gained entrance, give them the opportunity to
discover things which were maybe not correctly characterized or captured in the property records. But also
would give them the opportunity and if they couldn’t get in they’d have to do this from the exterior to characterize
the quality of the property, the condition of the property as either good, very good and there’s a scale that they
use. So it would help with that. | mean one thing that hasn’t been mentioned and maybe Ms. Kleiner or Mr.
Griffin can get into it in more detail but one problem that has been identified as all of this discussion has gone
on, is that the effective year built is a very confusing factor.

When the Assessor before Mr. Duhamel was in office in quite some time, he created as we’ve been told, a very
complicated kind of jerry-rigged | don’t mean that too negatively but system that kind of only he understood. Mr.
Duhamel then just kind of adopted that and just went forward with it. But the idea would be to reduce, there
would still be an effective year built but to reduce its importance and simply rely principally on the condition of
the property as characterized by an inspection and rather than have the condition rely on the effective year built,
do the reverse and they can explain this in more detail. But what would be accomplished is we, our agents, the
assessors, we’d have to hire an outside firm to do this, would be able to view the internals of maybe 30% of the
houses.

Alderwoman Kelly

Follow up. The one that you presented over in 1992 was that done externally as well or internally?

Special Bd. of Aldermen — 11/26/2018 Page 11

Mayor Donchess

Yes, when a full measure and list is done it is not just residential, it is commercial as well. That cost $1.5 million
dollars in 1992, what is that, almost 30 years ago or 28 or 27 years ago or whatever it is. That cost $1.5 million
dollars in 1990 or 1991 dollars. The technology has improved so that the cost is lower, they use like lasers and
stuff like this, they can measure from the outside the dimensions of things without actually going in, especially in
commercial buildings. So the relative cost is actually a little lower but it is still $1.3 million, $1.4 million, $1.5
million.

Alderman Jette

Thank you. | have several if you don’t mind. | looked at the charter and the ordinances and they don’t say a
whole lot about assessing and the State law doesn’t seem to say a whole lot about it either, maybe I’m missing
something. The charter just says that the “Mayor with consent of the Aldermen shall appoint 3 assessors and a
treasurer and collector of taxes” and it says “each assessor shall prior to his appointment have demonstrated
knowledge of property appraisal or assessment and of the laws governing the assessment and collection of
property taxes”. When | look at your organizational chart, | don’t see the Board of Assessors listed at all and I’m
wondering what is their function and to the people that we have there, do they meet this qualification? Aren’t
they supposed to be in charge of this department? Where do they fit into this scheme of assessing and
collecting property taxes?

Attorney Bolton

| can help with that. The Board of Assessors has supervisory authority over the Department but it is the Board
of Aldermen that can determine what the staff is going to be and that is in the charter, there is a separate
section of the charter from the section 42 that you were looking at Attorney Jette which talks more about the
Board of Assessors and the assistants that can be hired by the Board of Aldermen to assist them in producing
the assessment. There are ordinances that further define that and also define that as we sit here, that
assessing is part of the Financial Services Divisions and reports currently to the CFO. Obviously the idea of
reinstituting the Administrative Services Division if the Board chooses to go that route will change that, but for
the day to day administrative functions there is a hierarchy. The ultimate decision on what property values are
assessed each year and the decision as to whether to grant or deny applications for abatement is made by the
Board of Assessors.

The three current members of the Board of Assessors, the Chairman has about 50 years’ experience in the
Assessing Field; he was formally the professional assessor in Merrimack; prior to that he worked for a Mass
Appraisal Firm, for many years. Another one of the members is a real estate broker and accordingly has
knowledge in the real estate field and values of property and the third member has prior experience managing
properties, both | believe commercial and residential properties and has experience in the real estate field in
that way. So | think they all meet those general qualifications.

Alderman Jette

So may | follow up? It sounds like they probably do but on the organizational chart, why aren’t they somewhere,
why aren’t they at the top?

Attorney Bolton
| didn’t do the organizational chart.
Alderman Jette

| Know you didn’t.

Special Bd. of Aldermen — 11/26/2018 Page 12

Attorney Bolton

They could have been listed, they don’t have the authority to hire and fire for example, but they have the
authority to overrule the recommendations of the staff | think they do so advisedly when they do. But they are
not merely a rubber stamp either. They work with the professional staff to arrive at proper assessments and
proper decisions on abatement requests.

Ms. Kleiner

So |’ll answer as to why they weren’t in the organizational chart. We did not look, although we looked at
information that was being fed from our internal department to the Board of Assessors, when | talked about
looking about their Board Packets and the way abatements were written up and presented and that sort of thing.
We did not include them in the management audit as we did not interview them. We were looking at our internal
staff, our internal department and how it functions. Certainly that could have been looked at but it was not in the
scope of our audit to review the Board of Assessors.

Alderman Jette

When we look at hiring an Administrative Services Director and giving that Director the job of overseeing the
Assessing Department, | am wondering if we shouldn’t take a broader look at where the Board of Assessors fits
in here. Shouldn't they be supervising the Department and the Administrative Services Director is the
Administrative Services Director going to be able to, you know, is one person with all the other stuff | hear you
talking about, the Administrative Services Director being assigned, shouldn’t we have a Chief Assessor under
the Board of Assessors? | don’t know the answer, I’m just raising the questions. And whether or not — and what
about the City Treasurer and Tax Collector? Where does he fit into this?

Attorney Bolton

The City Treasurer and Tax Collector receives a warrant every year from the Board of Assessors and that
warrant essentially lists all of the properties and sets a value on all of the properties. A form called the MS1 is
transmitted to the State Department of Revenue Administration and very simply the State looks at what the City
needs, what its budget is, what it is going to have to pay for its share of the County Budget, County Expenses,
subtracts revenue from other sources and then says — Ok, we’ve got to get so much from the property tax, does
the division the value of the taxable property divided by into what you need to raise, they transmit back tax rate
they have calculated to the Treasurer and Tax Collector. The Tax Collector then sends out the bills, multiplying
the assessed value times the property tax rate. As the money comes in the Treasurer has superintendence
over that money and invests it wisely we hope and when it is needed to pay bills, it is there.

Alderman Jette

So talking about the full measure and list, personally | think it is very important that everyone in the City feel that
they are being treated fairly, that their taxes are fair compared to everybody else, you know, their share is fair.
And | think a key element of that is that their property is being appropriately assessed and it is fair compared to
everybody else. And | think doing part of that is keeping up with the assessment, you know, doing a full
evaluation where you do look at the properties in detail and you are not just doing a statistical analysis like we
just did.

So we are going to have to do another revaluation in 5 years; | know other cities do this constantly, they don't,
you know if you wait 5 years and then you try to do everything at once, | think it is a much more major project
and probably more expensive. If we kept up with it, if we did like you know every year we did a fifth of the City
and so that we would be keeping up, you know? | don’t know if that could be done internally or not, | don’t know
what the costs would be compared if we did, if we hired sufficient staff to do this on an on-going basis, whether

Special Bd. of Aldermen — 11/26/2018 Page 13

that would be cheaper than hiring someone to come in and do it all at once or hiring somebody to do it every
year, you know a part of it every year. But that’s something | think we ought to look at.

And when you mentioned building permits not being the most reliable information because people lowball what
their improvement is, that we don’t require verification by the contractor as to what it costs and everything. I’m
thinking — Why don’t we do that? And if it is because the Ordinances or our Ordinances don’t require it, maybe
we need to change the, maybe you should suggest legislation to us that we should adopt so that we can verify
that information. | just want to avoid the honest guy hiring a contractor and being full up straight with getting the
proper building permits, this is exactly what it is going to cost, allowing people to go in and do the inspections.
He ends up, his property ends up being valued at its full value. Some other person, his neighbor for example,
low balls what the improvements are that he’s making, maybe he doesn’t even let the inspector come in and
look at it and so you end up with false information and that neighbor, his property doesn’t get assessed properly,
so his neighbor is paying more in taxes than he is and that is unfair. | think we ought to do whatever we can to
avoid that situation.

Attorney Bolton

Well we certainly should. And it may be appropriate to get more information at the time someone gets a
building permit about what the cost of the construction will be. But the cost of the construction is not in most
cases going to be equal to an increased value of the property. Most of the time it will be different. It might cost
$10,000.00 for someone to redo the bathroom in their home. But that may not add $10,000.00 to the value of
the house. The house may or may not increase in value at all. It may increase by only $5,000.00 rather than
$10,000.00. A more extensive renovation that adds an additional room and a second or third bathroom to the
house might cost $80,000.00 to construct but only add $30,000.00 to the value.

So between the expertise of the assessor looking at it and charts and tables that could be used as a reference
that assessor has got to use judgement in determining what value is added by any construction project. And
before | forget because | meant to say this later, when people don’t get a building permit, yes it is bad and the
assessments may be wrong because someone has got the finished basement that is not getting taxed. Worse
than that is it hasn’t been inspected by the building department, we’ve got an electrical inspector, we’ve got a
mechanical inspector that would inspect any extensions of the gas heat. We've got framing and structure
inspectors that guarantee that whatever is built is structurally sound and won't fall down, wont’ fall down and
shear off the gas line and the electric wiring and what all was just installed. That is every bit as important
perhaps more important than getting the tax assessment right. | mean if we have fires and unsafe structures
and so forth, that is truly life endangering and ought to be corrected. So that is an additional benefit that can
sometimes be realized by doing the full measure and list and discovering these problems.

Mayor Donchess

| had a few thoughts in response or additional information or whatever. The Board of Assessors of course, they
are volunteers, so it’s hard to expect them to be in there every day and they have jobs, the Chair is retired but
the other ones have jobs. But also they serving in the way that they do, | think they provide an independent
oversight in the sense that sure an appraiser goes in and makes an assessment of what a property is worth.
Then the homeowner disagrees, and where do you go with that disagreement? Now you could go back to the
staff, but the staff has already made a determination and they may think they are right and they don’t change it.

What the Board of Assessors is, is they come in from the outside and they listen to the abatements or consider
the abatement request and take an independent view. So it gives a local appeal so you don’t have to go
Superior Court, at least one level of appeal, you don’t have to go to Superior Court, to the Board of Land & Tax
Appeals, you can just go down there to 208 and at least somebody is going to come in and review the case if
you the homeowner think that there is an error. So they do provide that function although they don’t oversee the
everyday work.