Another example of flaws in commercial property tax assessment methodologies

comes from Ocean City, in the article, "An Ocean City Icon Faces Turn in Economic Tide," subtitled "Property Taxes, Energy Costs and Insurance Rates Force Family to Consider Closing Park," from the Washington Post.

From the article:

As Ocean City has exploded into a megaresort, property taxes have soared for Trimper's, which operates on the last chunk of undeveloped land on the town's three-mile boardwalk. In the past three years, family members said, their assessed property value has tripled, from $21 million to $65 million.

So the Trimpers are facing reality. Revenue from thrill rides and arcade games can't keep pace with the skyrocketing value of their three-block site, they say. In addition to property taxes, insurance and energy costs are up, and the family is split over what to do: Some members want to sell, but others want to find a way -- perhaps through a change to lower the park's assessment or a historic designation -- to keep going.

I can't imagine that their revenues have gone up 200% even though their property tax assessment has gone up 200%.

Again, as I say in this "Avoiding the real problem with DC's property tax assessment methodologies," (and other) blog entries, if you value commercial property based not on its current use, but on what it could sell for if it were used as something different, you are going to price out and force traditional businesses out of business.

Trimpers Amusement Park on the boardwalk in Ocean City, Maryland. Washington Post photo by Linda Davidson.

Ironically, the Post has an article about merry-go-rounds in Paris in the same issue. See "In Paris, Two Euros Buys a Spin on an Enchanting Time Machine." From the article:

A few minutes later three giddy American teenagers approach the ticket booth."Are we too old to ride the merry-go-round?" one asks the attendant inside the glass cage. He replies in thickly accented English, "One is never too old to ride the carousel."

I bet they have different property tax assessment policies in Paris.