KANSAS CITY, Kan. — Angela Marcus enjoys doing yard work at her home at the Highlands at Piper subdivision in northwest Wyandotte County.
Marcus told the 41 Action News Investigators that in the seven years she's owned her home there, she has seen "a lot of build, a lot of brand-new build.”
Down the block from Marcus’ home, a new house is listed for sale at just under $319,950. According to the listing sheet, the property taxes on the 2,824-square-foot home are $5,500 a year.
Wyandotte County records show there are dozens of other parcels in the same subdivision without homes, mostly appraised in a price range of $10 to $30.
The 41 Action News Investigators found one parcel at 10535 Kane Drive where a fourplex is currently under construction.
In 2017, the appraised value of that property was $20. That appraisal dropped to $10 for both 2018 and 2019.
It means the taxable assessed value for the last and current year is $3, and the general property tax for the parcel in 2018 was 52 cents.
“This is crazy, this is madness. These lots $20 and $30, that’s not appropriate,” Marcus said. “I can tell you the lots are worth more than $20 because if it’s worth $20, I want to buy them all."
John Altevogt, a longtime real estate agent in Wyandotte County who’s also studied property taxes, looked at empty lots for sale in the Piper area, where single-family homes range from $250,000 to close to $500,000.
Altevogt didn’t find any lot for sale in the $10-$30 price range.
“The cheapest lot I can find is $45,000, and so to appraise it at that level is simply ridiculous,” Altevogt said.
The reason the property at 10535 Kane Drive and other similar parcels in the Highlands at Piper are appraised at $10 to $30 is because they’re getting the dramatically lower agricultural use tax rate, which is set by the Kansas Department of Revenue.
The Wyandotte County appraiser currently lists the property as “farming/ranch land (no improvements),” even though Kane Drive and other infrastructure is in place and construction of the fourplex is currently underway.
“Nobody’s going to run cattle on this. No one’s going to plow this up or plant corn or anything,” said Altevogt, pointing to an empty lot in the subdivision next to a home.
According to Wyandotte County records, the subdivision plat dividing up the Highlands at Piper into small lots for homes was recorded on Sept. 4, 2007.
The 41 Action News Investigators asked Wyandotte County Appraiser Kathy Briney if she could dispute a subdivision with a 12-year-old plat for residential properties as having agricultural land.
“Um, we could,” Briney said.
But she claims that to a large extent, her hands are tied by Kansas law. Specifically, Briney points to a 2016 law allowing for both residential and agricultural use in suburban developments such as the Highlands at Piper.
That agriculture use can include mowing grass for hay.
“You’ll see a hay bale in the middle of a lot. This is the developers have that figured out," Briney said. "If they claim agricultural use, then they have the right to get agricultural use."
The 41 Action News Investigators asked Briney is she has discretion to determine if there’s agricultural use or not.
“We do that, yes, and we’ve challenged many,” she said.
According to Wyandotte County records, a Grandview, Missouri company called Pinnacle Construction Company owns dozens of small and largely undeveloped parcels in the Highlands at Piper subdivision.
Of the 76 parcels the company owns in Wyandotte County, 54 of them are appraised at $20, 12 are appraised at $30 and one is appraised at $10.
Seven of them are appraised at no value at all.
Kansas law allows for “common areas” such as retaining ponds and grassy areas or easements between properties to not be taxed at all.
Pinnacle owner Sue Engbroten says once developers add infrastructure such as water, sewer and streets, the appraiser will change the classification from agriculture to residential.
So far, however, that hasn’t happened at 10535 Kane Drive, where the fourplex is under construction.
According to state law, the appraised value of the property is set on Jan. 1 and won't change until the next Jan. 1, regardless of what happens on the property.
In the case of 10535 Kane Drive, the appraised value of the property was set Jan. 1, 2019 at $10.
Just two weeks later, the developers applied for a building permit on Jan. 15, 2019.
According to Wyandotte County spokesman Mike Taylor, even if the fourplex currently under construction is completed and sold this year, the property tax will be based on the $10 appraisal for all of 2019.
But the appraisal and classification for 10535 Kane Drive will change in 2020.
Briney says any change in use can trigger the change in classification. She says building permits and aerial photography are used to make that determination.
She says major classification changes will be coming for the Highlands at Piper, where development is ongoing, in 2020.
When the 41 Action News Investigators asked Briney what she would tell homeowners in the Highlands at Piper subdivision who are paying high taxes if they complain about developers paying next to no taxes, she said to call their legislator.
When the 41 Action News Investigators asked Engbroten if Pinnacle is using any of its undeveloped lots for agriculture purposes, she said, “We could.”
She also said the tax break is important to developers due to the cost of putting in infrastructure such as water, sewer and roads to put up houses.
Piper High School is right across the street from the Highlands at Piper subdivision. Last year, local voters approved a bond issue to expand the school system by adding a new high school.
It means homeowners like Angela Marcus are paying a higher property tax rate than most of Wyandotte County, while developers like Pinnacle are paying the agriculture use rate.
“Why can’t they pay what the lot is worth? That’s just not fair, it’s not fair to citizens,” Marcus said.
Wyandotte County records show there are 68,202 total real estate parcels. Of those parcels, 1096 — or 1.2% — carry an agricultural use classification.
However, in terms of taxable assessed value, agricultural parcels account for 0.2%.
Residential taxpayers carry the heaviest burden in Wyandotte County with 49.1% taxable assessed value, with commercial properties at 48.6%.
In addition to the low tax rate for developers, county records show Pinnacle hasn’t paid its taxes for 10535 Kane Drive for 2016, 2017 or 2018, a total of $252.33 with special taxes and fees.
Taylor says failure to pay property taxes for three straight years triggers a tax sale.
“Because of legal requirements and due process, each and every delinquent property must be checked and the owners notified," Taylor said. "Then a court hearing is held where a judge certifies the property is eligible for the tax sale. So it sometimes takes time to certify properties which are eligible for tax sales.
“Developers game the system all the time. I suppose it’s good business practice for their bottom line, but it cheats the community out of money for things like cops, firefighters, parks and other amenities, which make the community they are building in a desirable place to live,” Taylor added.
Engbroten didn’t respond to the 41 Action News Investigators' request for an explanation of the unpaid tax bill.
