Court ruling on county property assessments looming

Delaware's three counties may be forced to update their decades-old property assessments as a result of a Chancery Court suit over school funding.

Vice Chancellor J. Travis Laster heard testimony over the summer in New Castle Court of Chancery on whether outdated property assessments, used to calculate a portion of funding for local schools, are hurting schools that need funding.

In Sussex County, the last property assessment was 1974.

Counties to the north have reassessed property since then – 1987 for Kent County and 1983 for New Castle – but a lawsuit filed in 2018 by Delawareans for Educational Opportunity and the NAACP seeks to force counties to reassess property at current market value.

It's safe to say beachfront property today does not cost what it did in 1974, said Richard Morse, attorney for the plaintiffs.

“Are they far enough from the real value of the market to be violating the law? We think so,” he said.

The state's attempt to dismiss the lawsuit was denied in January 2019, allowing the case to move forward. The case was then split into a county track and state track; the judge heard testimony last summer on the county's liability regarding property assessments.

“The result of the failure to reassess property values is that the recognized value of the underlying tax base in each school district has remained flat for decades while the costs of running those school districts have risen substantially because of inflation and other factors,” the lawsuit states.

Both sides in the case have until Nov. 17 to file their last briefs. Once those are in, Morse said, the judge will schedule final arguments, and then write an opinion. Morse said it may take a couple of months before the judge issues an opinion on property assessments, but it could come by early 2020.

Chip Guy, communications director for Sussex County government, would not say whether Sussex County officials are preparing for the possibility of a court-imposed property assessment.

“Because this is pending litigation, we are not commenting and have not been commenting as the case makes its way through the legal process,” he said.

In 2018, Delawareans for Educational Opportunity and the NAACP, representing about 20 parents and community leaders, filed a lawsuit in an effort to secure more money and better teachers for struggling school districts.

The lawsuit cites state test scores from the Department of Education that show a small percentage of low-income students score proficiently on math and English assessments.

“Schools with more disadvantaged students receive less financial support from the state than schools with fewer disadvantaged students. Likewise, school districts with poorer tax bases receive less funding from the state than school districts with wealthier tax bases,” the lawsuit states.

But even with new property assessments, the lawsuit contends more must be done by the state to fund needy districts. Funding based on the number of students benefits wealthier school districts, and state money meant to equalize falls short because property has not been reassessed, the lawsuit states. An equalization committee in 2015, 2016 and 2017 reported that the difficulty in raising funds has hurt poorer school districts and equalization funding has been misaligned because of a lack of real property reassessment. “In each of those years, the committee urged the governor and general assembly to take action to address the deficiencies in the equalization process,” the lawsuit states. “Corrective action has not been taken.”

Morse said he expects a trial on whether the state's funding formula is equitable to all school districts will be held after a decision is made over county property assessments.