Frequently Asked Questions

Question: How is ‘equity’ in taxes measured?

Answer: By market Value. For example, if you select 3 properties currently worth $150,000 on the market, the assessments for each should be very close, regardless of property type. If the City were at 100% of market value, then each assessment for these three properties should be close to $150,000. If these same three properties were assessed at wildly different values, then that is what is referred to as ‘disproportionate’ assessments. That is properties of similar value but dissimilar assessments.

Q: What is the point of keeping assessment ratios close to 100%?

A: The New Hampshire Department of Revenue Administration (DRA) ‘estimates’ our full market value each year. They do this based upon our calculated assessment-to-sales ratio. Therefore, the more accurate the City of Dover’s assessment is, the less ‘estimating’ the DRA will do, which helps ensure that the City receives its fair share when the state calculates state education aid and county tax allocations. The state requires that assessments be between 90% and 110% of market value at least once every five years. However, the City of Dover ensures compliance to this standard every year, thereby doing away with extraordinary changes in assessments and resulting tax bills. During the last few years, the City’s assessments, on average, ranged from 93% to 95% of market value. The point of all this is to ensure that each taxpayer is paying no more or less than their fair share of property tax every year, which includes Dover’s contribution towards the state education fund and county taxes.

Q: Do these changes in assessments cause the City to raise more or less revenue than was authorized by the City Council?

A: No. As the assessment base (the sum of all assessments) increases, there is a corresponding decrease in the tax rate. Conversely, if the assessment base decreases, there is a corresponding increase in the tax rate. Simply stated, the amount of property tax revenue the City collects is governed strictly by the City Council – except for the state education tax and the county tax. The tax rate is calculated by dividing the total taxable assessments by the amount of property tax revenue to be raised. Therefore, the tax rate changes according to the authorized property tax revenues and total assessments.

Q: What is the net impact to the City in terms of equity in assessments as a result of these in-house revaluations?

A: When 5-year revaluations are performed, assessments are brought in line only once every five years. Thus, fluctuations in the market would go un-reflected in assessments in the ‘off-years.’ When the fifth year arrives, all assessments would be brought into line with the market all at once, causing dramatic and unpredictable changes in tax bills all at once. In addition, during the interim years, assessments would likely be disproportionate. Recent state law changes require proportionality each year. The DRA performs studies each year for each municipality in New Hampshire as to uniformity in assessments. Since 1996, the City of Dover has demonstrated some of the most uniform and proportionate assessments exhibited anywhere in the state. Dover has met and exceeded all state standards every year. This is a direct result of these annual, in-house updates.

Q: What are the differences with in-house versus outside revaluations?

A: A full revaluation by an outside revaluation company could cost Dover between $550,000 and $650,000. This cost is over and above the normal costs of ongoing assessing responsibilities. In municipalities that perform full revaluations every five years, this would be a reoccurring cost every five years. Dover has not had a ‘full’ revaluation by an outside vendor since 1992. Beyond the high costs mentioned above, revaluations by outside vendors can be contentious. In addition to ‘going in’ costs, it was common for the City to have hundreds of abatement requests and numerous court appeals. Also, if performed by an outside vendor, they must assess all properties at 100% of market value all at once, causing dramatic shifts in tax burdens and hardship to many taxpayers.

Q: Why not have an outside vendor complete a revaluation?

A: When a municipality does not have the in-house expertise and resources to perform annual in-house statistical updates, they must contract with outside revaluation vendors. In Dover, the assessing staff is well versed and experienced with revaluations and has an operating program to ensure consistency in assessments and conformity to state laws on an ongoing basis. Therefore, there is no need to contract with outside vendors for full periodic revaluations.

Q: Why does the City do these assessment updates?

A: New Hampshire statutes require assessments to be ‘proportionate’ each year.  Since 1998, staff from the City’s Tax Assessment Office have conducted annual updates to assessments accordingly to follow market trends.

Q: What have been the market trends?

A: From 2001 through 2006, the market escalated substantially. This trend leveled off and started to show a modest decline in 2007 and into 2008. Towards the end of 2008 through 2009, there was a decline for residential properties resulting from the shakeout caused by the national economic crisis; however, the commercial market stabilized. In 2011, the Dover residential market stabilized. From 2012 and continuing through 2019, there has been increased sales volume and increases in sales prices. In 2020 during the COVID-19 pandemic, sales volume initially decreased, but sale prices continued to increase. Towards the end of summer, sales volume was up.

Q: Do you use bank sales or ‘short sales’ in your analysis when determining assessments?

A: No. The City does not consider bank liquidations or ‘short sales’ transactions when determining market value. The circumstances surrounding such ‘sales’ are not typical. All matters being equal, the ‘sales’ prices are typically 25% to 40% below the selling prices for normally marketed properties in the City. That said, the bank-owned or foreclosed properties were impacting value for normally marketed properties, for these properties must compete alongside bank-owned properties on the market. In the opinion of the staff appraisers, once those properties were absorbed, the market began to experience normal or typical market behavior.

Q: Can I get a tax break for being elderly or a veteran?

A: There are exemptions and credits for the elderly and veterans and the blind, deaf, disabled, and residential homes with a solar-powered system.  There are qualifying criteria for each of these exemptions and tax credits. More information is available on this website under Tax-Assessment/Applications.