KNOX — The town of Knox and the village of Altamont have finally settled a decade-long argument over the value of a reservoir located in Knox but owned by the village. After Altamont filed a suit in the state's Supreme Court, the town and village agreed the Altamont Reservoir, with a current assessed value of $1 million, should be assessed at two-thirds of that value.

Altamont had originally sought a full-market assessment of $241,800, or an assessed value of $145,080, but then later had it appraised for $390,000, or an assessed value of $234,000.

Knox Supervisor Vasilios Lefkaditis has said that the town came out better than expected, while the town assessor, Russell Pokorny, said that Knox could have been better prepared for this.

Pokorny is married to the councilwoman who recently lost her election bid against Lefkaditis.

The lawsuit, a special proceeding under Article 7 of the Real Property Tax Law, was filed in late summer last year by the village, claiming that the assessment was incorrect. For 2016 and 2017, the reservoir was assessed at $1,006,000. The settlement, which both the town and village boards agreed to in a resolution on Nov. 8, ruled that the reservoir should have had an assessed value of $663,400 for 2016, a decrease of $342,600, and an assessed value of $642,000 in 2017, or a decrease of $364,000.

The settlement also stated that the town and the Guilderland School District, in which the reservoir is located, must refund any excess taxes paid due to the high assessment in the past two years. The reservoir must also be assessed at this lower rate for the next three years.

The 303-acre parcel located on Sturgess Road was assessed at $1.6 million, with a taxable value just over $1 million. Altamont had found in its own appraisal that the reservoir was worth $390,000, or about $240,00 in taxable value. The village paid about $11,000 for an appraisal and an assessed value report to submit to the court.

Altamont Mayor Kerry Dineen said she believed that the village made the right decision in hiring an appraiser, saying that the village board finds it to be money well-spent, and that this will reduce the tax-burden on the village.

She said that the decision to go forward with the settlement was a weighing of “expenditures going forward vs gains.”

“This settlement gave us 75 percent of what we were asking for so we felt it was a number we could settle on,” she wrote in an emailed statement.

Dineen said that the refund is approximately $23,000, with a total savings for Altamont of about $86,000 over the next five years.

Neil Sanders, the assistant superintendent for business for the Guilderland Central School District, said that, for the 2017-18 school year, $10,375 will be redistributed from being taxed off of the property and instead raised in taxes from the entirety of the district.

Lefkaditis said that the town would be paying only $154, calculating this from the town’s tax rate being about 44 cents for $1,000 of property value. He divided the difference between the current assessed value and the value ruled by the settlement by 1,000, and then multiplied it by 0.44, getting 150.

“The assessor’s job is to assess,” said Lefkaditis. He later added, “I was not spending $10,000 for $150.”

Pokorny said that Altamont had been paying $37,000 and will now be paying $24,000, with most of the losses of revenue being incurred by the school district, which will have to pay back about $21,000 in excess taxes, he said. The town will receive about $3,600 instead of $4,100 a year and will have to pay back about $1,300. This burden for both the school district and the town will be distributed to Knox residents in property taxes, and it will occur for at least the next three years.

While Lefkaditis calculated only taxes that go to the town’s fund, Pokorny was calculating the taxes paid to not only the town, but also the highway department and the fire district. Lefkaditis said he did not include those in his total because he saw only the town costs comparable because the money spent on an appraiser would be coming from the town’s general fund; he was not considering the effect on Knox taxpayers but rather the effect on the town budget. He said Knox would not be fighting for the school or other districts.

Using a spreadsheet provided by Pokorny, The Enterprise calculated that the excess taxes that went to the town of Knox — for the town, highway, and fire district taxes — would total $2,900, or $1,493 for 2016 and $1,407 for 2017. This would exclude county and school taxes. Town taxes alone would total $309; $150 for 2016 and $159 for 2017.

“It’s really difficult to assess something like a reservoir,” said Pokorny. With homes, he said, he is able to compare houses to other houses in the town. The reservoir he had little to compare it to, and was using numbers from 20 years ago for the assessment; in 1997, the state had assessed the in-use reservoir at $1.6 million, which Pokorny pointed out earlier is already reduced to 60 percent because of the state-set equalization rate.

However, Pokorny said a property in western New York had gone through a similar situation, but the town declined to fund a trip there, he said. He also said that hiring an appraiser to assess the reservoir would have benefited Knox as well.

“We ended up where we wanted to be … ,” said Lefkaditis. “We actually did a little better than we hoped.”

Lefkaditis said that the change in assessment value was arbitrary, comparing it to West Wind farm, which stopped operating as a farm and lost its farm exemption, putting money back into the town.

“This is the ebb and flow of assessment,” said Lefkaditis.

He said that an appraiser would have cost the town $10,000, and that the appraiser the town met with had given an “off the cuff” estimate of what the reservoir should be valued at, giving it a full-market value of a little over a million, said Lefkaditis. The full-market value of the assessed values listed in the settlement are $1,105,666.66 and $1,070,000.

The village of Altamont has been filing grievances with the town of Knox for years. The village no longer uses the reservoir as a water source, but, as assessor, Pokorny said that water sources have value, whether or not they are in current use.

Dineen’s predecessor, James Gaughan, who had served for much of the dispute and much of its mission to reduce the assessment, said that the village based its arguments on evidence and facts, and put a lot of effort into this. In his opinion, Knox’s argument was “not fact-based,” and provided little to no evidence that the reservoir was worth what it was assessed at.

Corrected on May 16, 2017: The story originally referred to a Supreme court ruling; actually, it was a settlement.