(Ed.note: This was a comment post that I have brought forward for better visibility.)
I’ll try to answer these questions, Observer. Others can chime in if they disagree with me or want to refine my answers.
The property tax bill we just received was based on your property’s assessed value as of January 1, 2008. Any increase in the value of your property shown on this tax bill would have been between January 1, 2007, and January 1, 2008, and thus would not reflect what happened to house values during 2008. However, if you are like most people, your assessed value was the same on January 1, 2008, as it was on January 1, 2007, because there was no city-wide reassessment. If your assessed value did not increase, then the property tax increase you see had nothing to do with any change in value of your house.
Your tax bill probably shows that your estimated fair market value increased from January 1, 2007, to January 1, 2008, but that has no significant impact on your property taxes. The “net assessed value rate” (also known as the mill rate) is applied to your property’s assessed value to calculate your property tax, not to the estimated fair market value.
If your assessed value did not change, your property tax increased this year because the local governments—the technical college district, school district, county, and city—increased your property taxes. The amount by which each of these units increased your property taxes this year is listed on the right-hand side of the bill. On my bill, it shows the technical college district increased my property tax 5.3%, the school district increased it by 12.2%, the county increased it 3.0%, and the city increased it 4.4%. To the best of my knowledge, this is the first time the City of Evansville has increased its mill rate by more than a tiny amount in many years—since back before I was the city administrator.
On last year’s property tax bill, the net assessed value rate was .0227 (with rounding). On this year’s property tax bill, it is .0243 (with rounding). That resulted in a property tax increase (before credits) of 7.0%. Again, this increase was because the local governments decided they needed to increase your property taxes.
Bill Connors
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To be clear, Bill. The percentages listed in your note refer to increases in those taxing bodies share of the total bill. Correct?
ReplyDeleteSo that a 12% increase by the School District is applied only to their share of the total and not to the entire tax bill.
Grumps, that is correct. On your property tax bill, on the line for school district (for example), you will see a number that is the amount the school district received from your property taxes last year, and next to it you will see a number that is the amount the school district will receive from your property taxes this year, and this year's number is 12% larger than last year's number.
ReplyDeleteThen there is a total in each column, and this year's total (before credits) is 7% larger than last year's total.
Bill Connors
Former Evansville City Administrator
Bill:
ReplyDeleteDid you see the article in today's State Journal?
http://www.madison.com/live/wsj/projects/documents/2008taxchart.pdf
Do you know how to calculate the "fair market value" mill rate? The adjustment from assessed to fair market in Dane County cities doesn't seem to shift more that $1.00. Even if Evansville's were to drop by $1.00 to $23.30, a $200,000 house would be taxed at $4660. That far exceeds any city property tax in Dane County. Their range is $3250-$4040 with a mean of $3678. Yikes!
- Jim Hurley
Bill:
ReplyDeleteThe increase you note in the school portion was what got my attention, and may go back to your point many years ago about the "back loaded bonds" that ensure that each year even though no increase in anything else, the debt burden will rise to the highest in 2021.
I do not see the 10% as a sustainable rate. A little explanation of the school portion would be helpful.
4:45 PM
Observer, I've noticed that the school district's mill rate goes up and down. Last year, the school district's mill rate went down 0.4%. The year before that it stayed about the same. I think it went down the year before that. When I was city administrator, I remember it increased substantially one year, but went down the year before and/or the year after. I think much of it has to do with the enrollment count and the state's funding formula. I think that formula makes it hard to have moderate mill rate changes from year to year. You'd have to ask the school district staff to see if that is true.
ReplyDeleteBill Connors
Evansville City Administrator
Jim, the property taxes on our new house in Sun Prairie are almost exactly the same as the property taxes on our house in Evansville, but the estimated fair market value of the house in Sun Praire is $30,000 greater. And the total mill rate on property in Sun Prairie is at the high end for communities in Dane County. If Evanville were in Dane County, our property tax bills would drop by a large amount. Dane County's mill rate is much less than Rock County's, because Dane County's tax base is so much more valuable than Rock County's. I noticed this when I was city administrator, and it continues to be true.
ReplyDeleteBill Connors
Former Evansville City Administrator