Inside track

Property owners are getting savvy about asking for tax breaks. What will the next assessor do about it?

By Matthew Hirsch

Here's some free advice for the three candidates in the local assessor's race: Talk to the voters about George Sibthorp.

A real estate broker and longtime San Francisco resident who works from his Pacific Heights home, this guy has a deep understanding about what makes the assessor's office tick – and also what makes it dysfunctional. Who knows? He might even make a decent assessor, except that it would mean wrecking his own business.

You see, Sibthorp makes a living getting people a break on their property taxes. He drums up business by stuffing mailboxes with offers to work on a contingency basis until his clients first win back some cash from the tax collector. Judging by public records on tax assessment appeals, Sibthorp has been quite successful.

Why should the voters care? Because Sibthorp is cashing in on a service the Assessor's Office should, in theory, be providing for free. With every triumph he shrinks the pool of funds for public services, and some say the fact that he does business at all indicates a significant problem in the Assessor's Office.

According to records from the Assessment Appeals Board, the agency that acts as a referee between property owners and the assessor, Sibthorp has had business with 675 clients since 1991. Of those cases, he's gathered enough evidence to ask for tax breaks almost 300 times, and he's been successful about 4 times out of every 5.

Ron Chun, a candidate for assessor and former appeals board member, remembers him as a guy who came prepared. "He understood what the board wanted to see in a presentation," Chun told the Bay Guardian.

In his own eyes, Sibthorp views the work as a form of public service. "I think people have a right to appeal if they feel they've been overtaxed, and all I'm doing is helping them do that," Sibthorp told us.

Sibthorp said he's helping small property owners navigate a system they generally find intimidating and don't understand. He highlighted a bunch of reasons why someone would want professional help when dealing with the assessor. It saves time and money, and some folks don't even know they can appeal their property tax assessment, he said.

But what most people also don't know is that property owners can request to review their case with a hearing officer, which allows them to talk things over without all the formal steps required to visit the assessment appeals board. Glenn Barnes, head of the California Assessors Association, told us the public should not have to pay for these services.

Some agents charge a flat payment up front, and others record an hourly fee, while Sibthorp takes half the initial savings from his appeal.

In some ways Sibthorp is the embodiment of what's wrong with municipal government in San Francisco: The average guy or gal has to turn to a fixer or an insider to get anything done. The Assessor's Office seems to be a lot like the Department of Building Inspection – where paid "permit expediters" work the system for contractors and homeowners – and lots of other local government agencies.

As far as we can tell, none of the candidates are talking about Sibthorp and his ilk on the campaign trail. But when contacted for this story, they all said his business suggests there's a problem in the Assessor's Office, and each candidate offered different ideas for stanching the flow of public funds that leaks out in the form of tax breaks.

Chun said part of the reason people pay Sibthorp is because the Assessor's Office handles requests for tax reductions too slowly. The assessor doesn't give property owners enough information about relevant property transactions either, which means people have to rely more on Sibthorp's research, he said. Chun told us he'd improve on both those areas but doesn't expect that will make Sibthorp's business dry up.

Phil Ting, the current assessor, who Mayor Gavin Newsom appointed to run the office three months ago, after former assessor Mabel Teng resigned, told us if he gets elected, driving out Sibthorp's business is exactly what he hopes to do. "We need to make sure these folks don't make any money," he said.

Primarily Ting wants to tighten up the assessment appeals process to deal with outright fraud. He proposes a watchdog effort, modeled on an IRS program, that would reward people for busting property owners who withhold information to save on property taxes. But doing so, he said, would also help put up more resistance to the sort of business Sibthorp runs.

Sup. Gerardo Sandoval told us Sibthorp represents only a small part of what's going on in assessment appeals. He said the real problem lies with downtown commercial property owners who are doing the same thing Sibthorp does, only they're much more sophisticated about it.

"What's happening is, there's a snowball effect taking place," Sandoval said. "The word is out that the people running the Assessor's Office are incompetent, and it's a free-for-all."

E-mail Matthew Hirsch at matthew@sfbg.com.