There could be hope for remaining homeowners off Berckmans Road who don't want to sell their land to the Augusta National Golf Club but can't afford to keep paying exorbitant tax bills caused by inflated sales.
The city's new tax appraiser, Calvin Hicks Jr., says the county should consider granting them property tax relief next year now that the characteristics of the neighborhood appear to be changing. That would be a turnaround from a decision the Board of Assessors made two years ago denying homeowners there a special tax exemption that would keep their property taxes from being affected by the inflated sales.
On average, tax bills in the area have risen by 243 percent.
Bill and Denise Garner would like to see their property taxes fall more in line with those of houses not in the Augusta National's acquisition zone.
In 2004, the combined property taxes on their Heath Drive home and that of his 85-year-old mother who lives next door was $4,000. In 2005, the bills on their combined 3.85 acres shot up to $15,452, then to $16,356 in 2006.
However, 2006 tax bills on houses just down the street on the south side of the southernmost leg of Heath Drive - which haven't been affected by rising property values - ranged from $478 to $1,305.
"If the taxes go up much more, it's almost not tolerable," Mr. Garner said.
The Garners know they could become instant millionaires if they sold - recent sale prices have land in the target zone averaging $1 million an acre. He has been approached by Buzzy Johnson, the senior director of the Masters Tournament, but has turned down his offer.
Mr. Garner fears that giving up the property would be traumatic to his mother, Nelle.
"I don't want to feel forced to do anything, you know what I mean?" Mr. Garner said. "It's a frustrating situation."
MANY OF THE HOMES purchased by the Augusta National have been bulldozed as the golf club turns the land into a large, grassy parking lot, which will be available to tournament patrons next year.
The Augusta Chronicle pointed out those changes to Mr. Hicks, who told the newspaper that the land clearing makes it obvious that the neighborhood is undergoing a major transition. That would qualify property owners for the tax exemption, which requires them to live in their homes for at least 10 years before being able to sell without penalty.
Homeowners who break the covenant and sell the home within the 10 years would have to pay the difference between what they were taxed under the exemption and what they would have paid without it.
Charles Smith, the chairman of the tax assessors board, said that when the group denied the exemption in 2005 there were no physical changes to the neighborhood to suggest it was undergoing transition.
"We had the feeling that it was (in transition), that it might be, but we didn't have documentation to that effect," Mr. Smith said.
The National was granted a special zoning exemption last year to park 5,000 cars on 70 acres of residential property one week a year, which legally qualifies the area as one "undergoing a change in use from single-family residential," said Mr. Hicks, who was hired in October.
He added that some investors who have bought land in the area appear to be in the hospitality industry and are using property for that purpose, further evidence that the area isn't truly residential anymore.
EVEN BEFORE the changes, former Chief Appraiser Sonny Reece, Mr. Hicks' predecessor, thought homeowners who didn't want to leave shouldn't have to pay exorbitant taxes.
In early 2005, he wrote letters to about three dozen residents, telling them that their property values were about to increase drastically. He also sent them a copy of the state law that would allow them to receive a tax exemption on the difference between their property's residential value and its new transitional-use value.
Mr. Reece resigned later that year under pressure from the board, in part because of a decrease in the 2003 tax digest. A dispute then erupted within the assessor's office as to whether the law applied to the Berckmans subdivisions. At least one homeowner filed for the exemption and was denied.
Mr. Smith, the assessor's board chairman, wouldn't divulge how he would vote if a homeowner in the neighborhood applies for the exemption, but he did say the chief appraiser's opinion would carry a lot of weight with the board. No decision will be made until someone applies.
It costs $10 to request the exemption, and it can be done between Jan. 1 and April 1 at the assessor's office in the Municipal Building on Greene Street. If granted to a homeowner, the "transitional use covenant" would leave a home's appraisal value at its current high level but lower property taxes to that of similar-size homes in neighborhoods that aren't in flux, Mr. Hicks said.
"I am aware, and I think members of the board are aware, that there have been changes from two or three years ago," Mr. Smith said. "I really hope we do get some applications."
THIS YEAR HAS seen some staggering sale prices in the neighborhood.
In May, an investor from Kiawah Island, S.C., paid $2.185 million for three parcels along Hemlock Hill Road totaling 1.4 acres. Mr. Hicks said that transaction is likely to affect property values when appraisers go back next year, especially the sales bolstered by prices now being paid by the National.
In its 2007 acquisitions in the neighborhood, the club has paid an average of $1.2 million per residential acre, up from an average of $852,000 per acre last year.
For almost nine years, the Augusta National has been buying parcels in Berckman Heights, Berckman Road Gardens, Weslyn and other contiguous subdivisions. Prices skyrocketed when homeowners learned that the brokers making offers worked for the club.
According to homestead exemptions on file with the county, of the 99 residential parcels in the National's area of interest, only 15 still have owner-occupied homes. Many of those are elderly and have lived there for 40 years or more. They know they could get rich by selling, but they say they'd rather live out their years in their homes than take the money and run.
With fixed incomes, they've been hit hard by taxes that have gone up thousands of dollars in the past two years, even with school exemptions for residents over 65.
"We'd planned to stay here until we die," said a 74-year-old resident whose taxes on two houses leaped from $1,451 in 2004 to $5,120 in 2006. Like some of his neighbors, he didn't want to be named in the newspaper because he believes he'll soon be negotiating to sell.
"We're holding our own for right now," he said, "but I don't know for how long we'll be able to do that."
THE HIGH TAXES forced Tom Klose to do something he said he never wanted to do: sell the house where he grew up.
Taxes on the home he inherited from his mother rose from $241 in 2004 to $3,810 in 2005, then $4,071 in 2006. Then he got a notice from the county this year saying that the value of his one-acre lot and two-bedroom, one-bath house had risen from $321,552 to $582,912 - an 81 percent increase.
Because he wasn't living in the house on Heath Drive at the time, the exemption wouldn't have helped him. So, he sold the lot in May to one of the National's limited liability companies for $1.25 million and rights to purchase Masters Tournament badges.
The house is to be bulldozed and the land resodded for the parking lot.
"I didn't have the financial ability to continue to pay the taxes," said Mr. Klose, 55. "Think about what it would be to have it nearly doubled. It was going to be more than anything I could make off the property."
Mr. Garner doesn't want to negotiate, despite an offer on his lot for more than $1 million with rights to purchase up to four Masters badges each year.
He was pleased to hear that the Board of Assessors might grant a tax reprieve and said he'd be willing to agree to the 10-year covenant.
He and other residents said they would have a much better attitude about things. When the National's properties become grassy and landscaped, for 51 weeks of the year it'll be like living in the country.
"That sounds like a wonderful deal to me," Mr. Garner said.
Reach Johnny Edwards at (706) 823-3225 or firstname.lastname@example.org.
TAX INCREASES ON BERCKMANS ROAD PROPERTIES
Many owners of Berckmans Road properties, including Tom Klose, have had to sell their land because taxes have risen too high. Here is a look at how much taxes have gone up since 2004, with percent changes in parentheses.
|Gross digest||$4,111,624,734||$4,527,992,234 (10.1)||$4,585,912,140 (1.3)|
|Taxes levied countywide||$113,090,210||$113,420,847 (0.3)||$119,695,117 (5.5)|
|Taxes levied around Berckmans Road*||$89,704.08||$292,750.75 (226.4)||$335,836.75 (14.7)|
* on parcels within Augusta National's target area west of Berckman's Road
Source: Richmond County Tax Assessors office records, Richmond County Tax Commissioner's Office
The legal definition of an area undergoing a land use transition, according to Georgia law code section 48-5-7.4:
For purposes of this article, the term "bona fide residential transitional property" means not more than five acres of tangible real property of a single owner which is private single-family residential owner occupied property located in a transitional developing area. Such classification shall apply to all otherwise qualified real property which is located in an area which is undergoing a change in use from single-family residential use to agricultural, commercial, industrial, office-institutional, multifamily, or utility use or a combination of such uses. Change in use may be evidenced by recent zoning changes, purchase by a developer, affidavits of intent, or close proximity to property which has undergone a change from single-family residential use. To qualify as residential transitional property, the valuation must reflect a change in value attributable to such property's proximity to or location in a transitional area.
LAND ACQUISITION FACTS AND FIGURES
Since 1998, the Augusta National Golf Club has spent $54.9 million acquiring 155 acres outside the club's borders.
The first person to sell a lot to one of the Augusta National's brokers got $110,000 for a half-acre lot on Berckman Road, which the county had valued at $94,800. This year, a homeowner sold the National a one-acre lot on Heath Drive - with a two-bedroom, one-bath home - for $1.25 million. The property was valued at $46,438 before the county's major reappraisals in 2005.
Along with the properties off Berckmans Road, the National's purchases include commercial property along Washington Road, some residential properties on West Vineland east of the club and vacant land at the end of Eisenhower Drive flanking James Brown's old radio station.
By far, though, the club has concentrated its buying in the subdivisions west of Berckmans Road, including Berckman Road Gardens, Berckman Heights and Weslyn. Most of the acquired parcels have been cleared, and the club has said there will eventually be grassy, pastoral land 51 weeks a year, and a parking lot for Masters Tournament patrons for one week. The old parking area will become a driving range, which is scheduled to open in 2010.
The National now controls its properties under the names of 11 limited-liability companies: Berckman Corner, Berckman Residential Properties, Big Tree, BC Acquisition Co., BCRE Investments, FTD, G.J. Holdings, MP Magnolia, MP Washington, NHPC and Whiddon Family Properties.
Outside investors created the "market" that raised taxes
Many of the club's earliest purchases in the neighborhood west of Berckmans Road were inflated over fair market value by thousands of dollars, but for several years that didn't affect property taxes in the area of interest.
What did, though, were purchases by outside investors, who in turn resold them to the Augusta National at inflated prices hundreds of thousands of dollars over market value.
The investors have included:
Clyde Pilcher and Gordon Hardy, of Augusta, who together acquired four parcels the National wanted and were among nine investors in AMAP LLC, which bought another parcel. All five lots were sold to the club in June for $3.124 million. Total acres: about 2 1/2.
AMAP, Mr. Pilcher said recently, stood for "as much as possible."
"I probably could have gotten more," he said. "I think I left peacefully."
--Osbon Investment Properties LLC, of Macon, Ga., which bought two lots totaling 1.8 acres on Berckmans and West Vineland Road for a combined $228,500 in 1997 and 2002, then sold them to the National for $1.2 million in 2005.
--Eamonn's Corner LLC, of Fort Lauderdale, Fla., which bought a house at the corner of Berckmans and Hillside Lane in 2006 for $520,000, then sold it to the National four months later for $625,000.
--5 Hungry Dogs LLC, from California, which bought Troy Goebelt's gargantuan two-story house on a 0.43-acre lot on the southern leg of Heath Drive for $1.995 million in December.
--Warren Mersereau , of Kiawah Island, S.C., who in May bought three connected parcels totaling 1.4 acres for $2.185 million from Claud R. Caldwell III. Contacted by phone and asked what he plans to do with the property, Mr. Mersereau would not comment. Mr. Caldwell did not respond to two notes left at his home.
THE TAX HIKE
Since 2004, taxes on the subdivisions west of the Augusta National Golf Club have risen disproportionately because of inflated sales. In fact, the majority of the increase in tax dollars collected countywide in 2005 - 61 percent - came from additional taxes levied on the neighborhood off Berckmans Road.
Gross digest: $4,111,624,734
Taxes levied countywide: $113,090,210
Taxes levied on parcels within the Augusta National's target area west of Berckmans Road: $89,704.08
Gross digest: $4,527,992,234 (10.1 percent increase)
Taxes levied: $113,420,847 (0.3 percent increase)
Taxes levied on parcels within the Augusta National's target area west of Berckmans Road: $292,750.75 (226.4 percent increase)
Gross digest: $4,585,912,140 (1.3 percent increase)
Taxes levied countywide: $119,695,117 (5.5 percent increase)
Taxes levied on parcels within the Augusta National's target area west of Berckmans Road: $335,836.75 (14.7 percent increase)