GUEST EDITORIAL: Sandoval County Assessors Office: Unfair burdens on businesses

Businesses in Sandoval County are grappling with increasing financial pressures due to rising inflation, insurance premiums and taxes. These challenges are exacerbated by the county's property tax assessments, which are disproportionately affecting certain businesses.

Inflation and business costs

Inflation has driven up costs for raw materials, labor and other essentials, impacting businesses across various sectors. For example, restaurants face higher prices for key ingredients like chicken, forcing them to pass these costs onto consumers. This inflationary pressure is compounded by the doubling of property taxes due to inflated assessments by the Sandoval County Assessor's Office.

Assessors Office and business burden

The property assessments in Sandoval County are causing significant strain on businesses. While property tax assessments should reflect the fair market value of real estate, the assessor’s recent decisions have led to disproportionate increases for some non-residential properties. In 2024, certain property owners reported their land values more than doubled, outpacing inflation. This increase can elevate monthly costs for local businesses by $500 to $1,500.

Assessors often rely on comparables rather than proper appraisal techniques, which could better account for the differences between sales adjusting for different locations and age of properties. This flawed approach risks driving businesses to closure, leaving shopping centers vacant.

In Rio Rancho, select commercial real estate land values are assessed at $13.15 to $13.36 per square foot, more than double other rates. In contrast, large out-of-state corporations face lower rates of $6.40 per square foot. Local businesses are unfairly burdened, paying up to $13.36 per square foot. This disparity prompts questions about why certain businesses are targeted with higher assessments while others are favored. Furthermore, Albuquerque’s Uptown has lower land rates than Rio Rancho despite having higher traffic and population counts. This inconsistency could push businesses to relocate to Albuquerque, as Sandoval County appears to be favoring some properties over others, essentially picking winners and losers.

Consequences of inaction

If the current assessment practices persist, the consequences could be severe. Many small and medium-sized businesses might close, leading to job losses and economic instability. Local business closures would reduce the availability of goods and services and degrade our community's quality of life. Additionally, protesting these unfair valuations costs each business or property owner money, as they need to hire an attorney or advisor to contest these poorly conducted assessments. This, in turn, burdens each taxpayer in Sandoval County with the expense of defending the Assessor’s Office against actions that should never have been implemented in the first place.

Conclusion

The escalating costs due to inflation, property assessments and taxes are putting immense pressure on businesses in Rio Rancho and Sandoval County. To prevent widespread closures and job losses, it is crucial for the Assessor’s Office to implement fair policies. Limiting non-residential property tax increases to 5-10% annually, like the 3% cap for residential properties, could provide relief. By adopting fairer assessment practices and eliminating inflated valuations, a more stable economic environment can be fostered. Ensuring businesses can operate sustainably without excessive tax increases will benefit the entire community’s economy and well-being.