County tax break possible for businesses hurt by water woes

Bill Smith
The News-Press

The Lee County property appraiser is studying the impact on property values, especially among businesses, caused by the 2018 red tide and blue-green algae attacks on the region's prized waterways.

"Conventional wisdom is that business was off over part of (Fort Myers) Beach," Chief Deputy Property Appraiser James Sherron said. "There's really no way for us to know the impact of that until we collect some data."

Waterfront property is prized by commercial interests and homeowners alike. Businesses thrive on waterfront experiences, ranging from accommodations to dining to seaside shops and activities. When the waterfront location thrives, its value increases.

For residential property, a home on the water is prized property, commanding prices far greater than similar homes on an inland parcel. 

Smelly effluent on the beaches kept some people away through the summer and fall and could have sent some buyers away.

More:Red tide suspected as dead dolphins wash up on Collier, Lee beaches

A dead Kemp's ridley sea turtle is documented and picked up by a Sanibel Captiva Conservation Foundation stranding volunteer on the Sanibel Causeway on Thursday, Aug. 2, 2018. A suspected red tide outbreak is ravaging parts of Southwest Florida.

Values for both residential and business property are based on the estimated market value as of Jan. 1. The value set by the property appraiser's office is the basis for property taxes assessed on private property.

Business owners receive an annual letter from Property Appraiser Kenneth Wilkinson with advice on how to make sure information that affects property value is considered. This year, issues of red tide and blue-green algae will be addressed, and the appraiser has provided specific guidance for business. 

"Each year we ask the commercial businesses for their income information," Sherron said.  "Additionally this year we’re suggesting that if they had some impact on their business from the red tide or the algae, that it is vitally important that they tell us and show us that their business was in fact impacted so that we can reflect it in the values."

Business owners have complained that the widespread publicity from the red tide and blue-green algae infestations led to some buyer reluctance to book rooms in advance of the winter season. Fewer people in rental units and hotel rooms means fewer people to visit other tourism-based businesses. 

More:Fort Myers Beach activity looking up for holidays; hopes for the future are positive

Comparison of business income from one year to the next is one factor the appraiser's office uses to judge the current value of real estate. That's why a request has gone out to commercial property owners for information that can be used to figure out the values.

"It is totally voluntary, it is completely confidential, the best way for them to tell us what is going on with their business is just for them to answer the questions and send us back the information,"  Sherron said. 

It is the second consecutive year that the property appraiser has had widespread environmental issues to consider when evaluating the year-to-year changes in property values. Last year damage from Hurricane Irma was used in the calculation. In particular, people who were out of their homes due to hurricane damage as of Jan. 1 received lower values for the year.

Business owners can prove lower values with basic math. Residential property owners have a different kind of issue; the impact of diminished water quality on values is not necessarily realized immediately. Sales prices are used to determine values countywide. 

Sherron said the analysis of year-to-year home sales has not started yet but that the analysis will look at what properties are selling for rather than focusing on the immediate impact of a water problem while the water quality was at its worst. 

"The residential side is really kind of simple, the sales prices will bear out what the impact was on the market," Sherron said. "We will look at the sales transactions on residential (property) to see if there is an impact, especially on waterfront parcels.

Real estate agenda Brett Ellis, a Realtor with Keller Williams Realty Fort Myers and The Islands, has been tracking housing price trends in the market for years.

More:Lee County tourism promoters spend recovery dollars as patchy red tide persists

He says Lee County prices have been fairly stable since 2016 but that there were discouraging signs last year when tourists and potential buyers got a whiff of the water at the height of the algae and red tide infestations.

"People who got off the planes, spent a day and left are people who canceled a trip because of what they saw in the media." Ellis said. "Some of those people may be buyers two, three, four, five years from now; all the property appraiser can look at is what happens on Jan. 1."

As the property appraiser compares year-to-year sales, some residents may show specific issues that will linger, such as signs of the impact of algae infestations in canals

"Some people will send us pictures of green algae all around — that's OK," Sherron said. "Ken (Wilkinson) and I have discussed that a little bit if there really is an impact on the value (pictures are) a benefit to have."

Ellis said that there may be indicators applicable for particular residential properties showing falling values, such as an appraisal done for a divorce before the water problems hit and the selling prices afterward.

Ultimately, property owners have recourse through the appraiser's office and ultimately to the Value Adjustment Board to make their case for diminished property values.

More:Red tide is clearing — but for how long?