Archive for category: General Information

When I wrote this month’s blog post, it was March 17th. Happy belated St. Patrick’s Day to all! I fondly remember the days of having a beverage or two, settling into Fuzzy’s South or the old Coach’s Bar, both in south Kansas City to start the festivities. If we were lucky enough to have the 17^th fall on a Thursday or Friday, it was time to settle in for 12 hours of basketball for the first rounds of the NCAA Basketball Tournament.

While I have not participated in those days in years (actually decades 😊) I am acutely aware of these memories as many are not celebrating this day for the second consecutive year. However, we are heading in the right direction. And with patience, understanding and respect, we are on the verge of gathering with others for all events.

Travel and Hospitality

Earlier today, I participated in two separate events relating to the travel and hospitality industry.

The airline industry reported the first day of 1M+ passengers since March 16th, 2020. Granted, this is aided by the Spring Break vacationers. But as more become vaccinated, the industry believes this to be the start of leisure travel picking up and moving closer to 2019 summer numbers.

Limited-service hotels will be the first to see increases in daily occupancy, but the full service and high-end hotels will continue to suffer until business travel commences. One suggested a business travel target date of September 10th as this follows the Labor Day weekend; the country should be in a position of herd immunity and conferences and conventions may be targeting this time frame to host large, in person events.

How does this affect the property tax world and valuations?

We will see…

Some jurisdictions have taken a proactive approach this year by reducing valuations on theatres and hotels. We’ve witnessed decreases ranging from 20-30% before appeals have been filed, as the county assessors are anticipating appeals on these types of properties.

We did not see this carry forward to the sit-down restaurant industry. This is interesting to me – while this industry adapted and has been creative to account for pickup service, the value of the seating/dining area has been diminished.  How do we account for this component of economic obsolescence? Clearly a factor (i.e. the pandemic) external to the property is driving down the valuation. But how is this measured when the business creates alternative methods to derive income and maintain business operations? Does this become a business valuation or the valuation of the real estate?

These are the questions taxpayers need to assess and address when contemplating the value of their property.

We are now in full swing – business personal property filings are due; real estate appeal deadlines will be occurring at the end of March, April, May and June; railcar property tax returns are due at the end of March, April and May and my golf game is suffering as a result. (Gladly, I may add!!!)

Thank you so much for continuing to read about my/our journey. As always, if you have questions, comments or concerns, please reach me at the following –

dswartz@swartzaai.com | dswartz@indurantetax.com

Stay safe, stay healthy and get vaccinated when the opportunity presents itself!

Welcome 2021! And let’s just say, we’re hitting the ground running. We’ve implemented a couple of strategies for the start of the year and we’re already seeing positive results.

Investing in Public Radio

In December, the company invested in our first “marketing” strategy by investing in local public radio. To be honest, I am completely amazed at the response we’ve received over the past 45 days. Countless emails, text messages and phone calls from individuals that heard our 10 second “sponsorship”. With no set times (slots are randomly selected by a computer algorithm) the spot could be heard any time from 5am-9pm each day of the week. This was so successful, we’ve decided to reach out to Nevada Public Radio with the same messaging, as we are trying to create a Swartz + Associates, Inc. presence in the Las Vegas area to compliment the Indurante railcar work.

We thought this would be important as Nevada has one of the earliest appeal deadlines (January 15^th) and believe the commercial real estate market has been affected significantly due to the pandemic.

The response has been beyond expectations with over 30 new properties under review for this year. Depending on the results of the impending hearings, we will definitely increase the marketing budget as it relates to radio. A special thank you to Ron Yurman, Director of Business Development in Kansas City at KCUR 89.3. If you’re interested in learning how they can be of benefit to your company, you may reach him at rony@kcur.org.

Investing in People – Dan Slattery

The second investment made at the start of the year involves the engagement of a technology officer to support both entities.

Meet Dan Slattery. Dan has been involved with IT management for most of his professional career, including 10+ years in a Senior Manager or Director role with Caesar’s Entertainment Corporation. In 2018, he founded Engaged Innovation as a technology consulting firm. We connected through Engaged Innovation, employed the company to review the Indurante business and haven’t looked back.

Learn more about Dan Slattery here.

We have been working with Dan over the past 18 months in the creation of Railmarx, our proprietary software used exclusively for Indurante clients in our property tax service for owners of private railcars. Dan and his team have worked very closely with the Indurante associates as well as several members of Swartz + Associates. Over this time, he has learned a tremendous amount about the companies and will bring C-Level thinking (strategic long term, as well as immediate improvements to the day-to-day operations) which will benefit not only our companies, but more importantly, our clients. I am excited to have him be considered a part of our group and look forward to the opportunities we will be able to present to our clients in the future.

Stay tuned… we’ve been discussing a couple of ideas which could have a significant positive impact to clients and future clients!

Looking Ahead

2021 should be our busiest year in the last 10 years and I am confident we are making the correct investments in technology and employees to insure we continue to meet the needs of our clients.

As always, I appreciate your feedback. You may contact me via email, dswartz@swartzaai.com; dswartz@indurantetax.com or reply to this blog on my respective websites – www.swartzandassociates.com or www.inurantetax.com.

Happy New Year to everyone – May 2021 bring good health, safety and joy to all!

Happy Thanksgiving everyone!

This 2020 year has been filled with highs and lows but one thing we can always count on – the 4^th Thursday of November will be a time to be with family as we reflect on what we are thankful for and blessings from the past year.

Although this year will be virtual for many (I don’t remember the last time I have not been with my parents and my brother’s family) this will not keep us from enjoying our time together. I do know one thing that is certain… clean up will be a lot easier than in previous years. 😊

Zoom fatigue is real, but I’m confident we will be able to host a “meeting” with the extended family, with football in the background and multiple conversations occurring simultaneously. In many respects, it will be just like being together only we have the comfort of begin able to end each evening by sleeping on our own beds!

If you’re a frequent reader of my blogs, you know I spend a little time talking about my family.

Well, our youngest turned 21 last month and it was nice to be able to celebrate with him. While I’m sure he would rather have been celebrating with friends a little closer to his age, we did manage to enjoy the day in fine fashion, sampling bourbon distilled in Springhill, KS.

This was quite a pleasant surprise and if you live in the area, I would suggest heading to Bull Creek Distillery to sample their spirits.  www.bullcreekdistillery.com.

Thank you to all for continuing to support both Swartz + Associates and Indurante & Associates.

We are truly thankful for the opportunity to represent your interests. 2021 will represent my 35^th year in the property tax industry and I believe we are well positioned to represent our clients for the next 35!

I am fortunate and thankful to be surrounded by family, friends, employees and clients who care about us and each other. I believe it’s the little things that make the difference, and I look forward to taking care of the little things for you as we move forward.

Giving Back

Recently, I was watching Good Morning America and Michael Strahan was interviewing John Legend and Christy Teigen. They have joined with McDonalds Corporation to support Ronald McDonald House Charities, creating the #HereForRMHC Challenge. This Challenge begins on 11/25 and will run through the end of the year. To participate, simply post a photo or video with #HereForRMHC from your Instagram, Twitter, Facebook or TikTok account. McDonalds will give $100 in your name as part of its $100 million commitment to the Charity over the next five years.

As many of you know, and as I have expressed in previous blogs and postings, this Charity is very important to me; previously serving as a Board Chair for the Ronald McDonald House Charities of Kansas City and currently a member of the Advisory Board. Add to the fact my family has been spending quality time during the Pandemic watching The Voice, featuring John Legend as one of the coaches – this is clearly a “no brainer” to get behind.

So – please do the following:

• Build a house by forming a diamond with your hands
• Show the chimney by pointing your pinky finger up
• Put your heart into it by pushing your index fingers down, forming a heart shape.
• Take a picture or video and post to one of your social mediums

It’s that easy and you will have made a difference in a family’s life. I know the houses in Kansas City cannot support all the families currently in need because of the Covid related restrictions. Luckily there are hotels in Kansas City that have offered rooms to support these families in need. The Charity will pay for the hotel room to insure the families do not have to spend any of their money for accommodations. Please consider this small act of kindness during this holiday season as there is no greater gift. To learn more about RMHC, please visit rmhc.org. For full terms of the challenge, please visit McD.to/HereForRMHC.

As always, I appreciate your feedback.

You may contact me via email, dswartz@swartzaai.com; dswartz@indurantetax.com or reply to this blog on my respective websites – www.swartzandassociates.com or www.inurantetax.com.

Last Friday, the employees of Swartz + Associates met to discuss the balance of the year and looking ahead to the 2021 property tax season. With articles being written about the future of commercial real estate; whether it relates to the hospitality industry, the retail sector, re-configuration of shopping centers or changing the use of office buildings, one thing is certain – change is coming!

Timing

The timing of the change is much harder to predict, but it is fair to assume the dynamics of commercial real estate over the next 3-5 years will be quite different than what we have traditionally experienced. The question is, how will the county jurisdictions react?

As I have stated in previous blogs and as you may already be aware, property taxes levied against a property primarily are used for local school district funding. Between 60%-75% of the total property tax liability is used for public, local schooling. With the changes due to the coronavirus and the increase in virtual learning, demands for newer technology and equipment are straining the current budgets. There will be significant pressure on the county assessor’s offices to maintain current values or risk a reduction in property tax dollars collected in 2021 and beyond. This represents a major challenge for everyone; taxpayers, county assessment officials, investors, school districts, community colleges, ambulatory services, libraries… you get the idea.

How will the respective assessor’s offices react?

Most states define “Market Value” as “Value in Exchange” rather than “Value in Use”. Current market conditions and sales are the driving factors in this determination rather than historical data, such as leases in place and/or sales dating back 2-3 years. Based upon the current environment, we are monitoring the marketplace to see if leases are being renegotiated, rents are being deferred and/or if concessions are being offered to reduce vacancies. All of these issues will affect the valuation of a property, particularly if a county is obligated to value a property as it sits on its valuation date (typically January 1^st).

In the Midwest: Iowa, Colorado and Missouri are all subject to re-valuation for the 2021 tax year, while, Kansas, Minnesota and Nebraska are subject to an annual assessment review. Many other states have caps in place as to how much the value can increase in a given year until there is a change in ownership. As you can see, it can be quite confusing. During our planning meeting we discussed these situations and how to best represent our clients in the jurisdictions they have property.

Next Steps

We will be working on expanding our presence in the Las Vegas market, as we believe changes in market value first appear in the Southwest (AZ, NV and CA) and the Southeast (FL and GA). With our Indurante office creating a presence in Las Vegas, this is a natural opportunity to grow the Swartz practice with existing clients and expanding our service to those with properties in Clark County.

The Indurante business will remain busy for 2021 as well. The pandemic has had an effect on many industries, and the railroads are certainly not immune. Railcars have had significant idle time and/or storage time due to decreased volume in the shipping of goods, products and materials. We have witnessed a steady decrease in rail activity throughout the year, but hopefully we will start to see an uptick. We are constantly reviewing the market to determine how these conditions are affecting the valuation of railcars and avenues we can review to insure “fair market value” is assessed to these assets.

As always, we appreciate the opportunity to represent your interests and thank you for thinking of us. If you should have any questions, please do not hesitate to reach out to me – dswartz@swartzaai.com.

By Donald Swartz, President and Principal of Swartz + Associates, Inc.

It was just over a year ago I wrote to everyone about an incident that changed my perspective about many things. As you may recall, on July 9^th, while heading to my Las Vegas office on a bright Tuesday morning, an individual ran through a red light, hitting the Uber I was riding. Eight broken ribs, a separated shoulder, a broken clavicle and four fractured vertebrae later, I am feeling pretty good and amazed how much has changed these past 12 months.

Now it’s my turn to help be supportive and be the cheerleader, as so many were for me.

Last Tuesday, my father had quintuple bypass surgery. Yes, no typo, five bypasses! The surgery went as well as anyone could have expected for a man turning 89 in November. What to do, what to do… In this Coronavirus environment, all one can do is offer emotional support for the family. There is no visitation at the hospital. No hugs, no holding hands, no “just being there”. Only phone calls, Zoom setups during the week and words of encouragement. The true providers are the nursing staff, who serve both the medical needs of the patient and the emotional needs during this pandemic. Truly unbelievable.

And yet, my father remains optimistic that he will be heading home soon. And why not? He has always been optimistic and pragmatic about everything – family, friends, and his working professional career. Never, did he display negativity. While I try to emulate that in my life, it can be very challenging, especially in today’s world. Talk about role models, he’s top of the list.

Now on to the working front.

Last month, I mentioned one our employees, Mark Phillips, discovered an error by a state for the valuation of railcars. His uncovering generated millions of dollars of tax savings for all owners of railcars who had situs in that state. We submitted an article to our clients in the industry. Here is a link to that PDF. Please take a look if this is of interest.

Slowly but surely, our cases appealed in 2019 and earlier that have been delayed, postponed and/or pushed back are getting their “day in court”. The results have been very positive as various county assessor’s are working with us to resolve outstanding appeals from 2018 and 2019. This is a very good idea, as the system will again be backlogged due to the current appeals and the projection of 2021 appeals looming on the horizon.

There is no question in my mind, property tax valuations (both real and business personal property) are going to decrease in 2021 – the big question is whether the counties will recognize the downward swing caused by COVID-19.

As always, if you have any questions or comments please reach out to me directly – dswartz@swartzaai.com.

Stay healthy, stay safe and for everyone’s sake, please wear a mask in public settings!