Former BernCo DA sues county assessor, alleging unlawful property tax increases

Two homeowners have filed a class action lawsuit against Bernalillo County Assessor Damian Lara, alleging unlawful property tax increases on homes placed in revocable living trusts.

The lawsuit, which Albuquerque residents Edward Roberts and Kari Brandenburg filed with the 2nd Judicial District Court on Monday, coincided with a motion seeking a temporary restraining order to halt delinquent tax penalties against the plaintiffs, which began Dec. 10.

Brandenburg served more than a decade as Bernalillo County district attorney before stepping down in 2016.

The lawsuit, which also lists the Bernalillo County Board of Commissioners as a defendant, alleges the two plaintiffs aren’t the only homeowners who have been subjected to alleged illegal tax increases. Nearly 400 homeowners who transferred their properties into a trust were similarly affected, court documents show.

A spokesperson for the Bernalillo County Assessor’s Office declined to comment, stating the county was unable to talk about pending litigation.

The two homeowners allege that Lara unlawfully reassessed their residential properties after they were placed in a revocable living trust and he imposed property tax increases larger than the 3% cap set by state law.

Valuations of residential properties statewide cannot be raised by more than 3% per year of the previous year’s assessed value, with some exemptions.

The limitation on increases in value does not apply to residential properties being valued for the first time, properties that have been physically improved, properties that have been zoned differently and properties that changed owners in the year prior.

This means that if a home sells, the cap disappears and the assessed value can rise by more than 3% the following year, triggering sudden, sharp tax spikes often referred to as “tax lightning.”

However, state statute says that a change in ownership does not include when a home is placed in a revocable living trust, meaning such a circumstance is still subject to the 3% cap.

A revocable trust is a legal tool that a person creates to hold their assets while they’re alive. It’s most often used for estate planning, said Chris Dodd, the attorney representing Brandenburg and Roberts.

Revocable trusts help people avoid the probate process after a person dies, allowing the beneficiary of the trust — most often the owner’s spouse or child — to receive the asset, such as a home, immediately, versus going through the court, Dodd said.

“There’s this misconception that trusts are something that only really wealthy people use,” Dodd said. “But very ordinary people use trusts to put their estate in order.”

Brandenburg and Roberts are among those who recently placed their residential properties into a trust and were subsequently subjected to alleged illegal tax lightning.

Brandenburg placed her properties in a trust in September 2024 and saw taxes on her primary residence in Albuquerque jump 26% from $12,242 last year to $15,449 this year, according to the class action complaint.

Property taxes on Roberts’ Albuquerque home rose by more than 32% from $3,362 last year to $4,447 this year after placing his property into a trust in July 2024.

The lawsuit alleges that Lara “has repeatedly, willfully, and knowingly disregarded” the statute by treating revocable trust transfers as taxable changes in ownership and “likewise ignored the written protests” from affected homeowners and their counsel.

“Our position is that the rights of these 400-some-odd homeowners have been trampled on,” Dodd said. “It’s really disappointing to see government actors consciously choosing to ignore our laws and to simply refuse to do the right thing.”

The lawsuit alleges that Bernalillo County is the only county in New Mexico enforcing the view that a transfer into a trust triggers tax reassessment, unless the deed contains the word “revocable.”

According to the suit, statute presumes that all trusts are revocable — capable of being changed or canceled — unless expressly identified as irrevocable. The suit also alleges that the county’s prolonged practices — such as asking for the same document multiple times — prevented homeowners from seeking relief during the protest window that follows distribution of valuations in April.

Some homeowners, like Brandenburg, have already paid the first half of the inflated taxes, while homeowners like Roberts have elected not to pay and will be considered tax delinquent and subjected to penalties and late fees that began Dec. 10, the lawsuit says.

Dodd said he and attorney Amber Fayerberg hoped the restraining order would come through before then, but hadn’t heard anything from the court as of Tuesday.

As for the class action lawsuit, the plaintiffs are seeking restoration of lawful valuations under the 3% cap, refunds of alleged illegally collected taxes and damages, which Dodd estimated could range anywhere from thousands to millions of dollars.

“The problem with this situation is if it’s unremedied, those amounts will compound,” Dodd said. “If you get hit with tax lightning this year, then next year, your taxes go up by 3% but they go up 3% on the inflated assessed value. So we’re talking many millions of dollars in unlawful taxes that would be imposed if unremedied.”