One of the things that comes up each year as folks get property tax bills that represent that their property is valued more and more, is whether there should be a comprehensive reassessment for communities where there has been a "shock" to valuation such as the current economic decline.
Our city represents in the current budget that the valuation decline has been about 2%---However if you click on the post, you can see that the city itself has lowered the sales price for the former police station from $178,000 to $149,900. One wonders whether the city budget figure is just a fiction to avoid facing reality.
There has been an argument that all residents suffer equally during a decline and thus, there is still equity with respect to the local owners. However....there is not equity to those coming to town or shopping to purchase a home in Evansville. One hint of that fiction is that there are homes that have been on the market for almost 5 years now and no buyers. thus...
Would it serve everyone better and fairer if there was a reassessment of all properties in Evansville? You make the call.
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If some kinds of properties had value declines greater than other kinds of properties (e.g., if houses had a greater value decline than commercial and industrial property) or houses in some parts of the city had value declines greater than in other parts, the answer to your question might be "yes." If that were not the case, revaluing all the houses would cost the city a lot of money and have absolutely no impact on property tax bills. The property tax process starts when the taxing authorities determine their tax levies, which are dollar amounts, not rates. The rate is determined by taking the total amount of the levies and dividing it by the total value of the properties in the city. If values of all the properties in the city decrease by the same percentage, and the taxing authorities keep their tax levy amounts the same as they would have but for the property value decrease, then the only result is that the rate goes up just enough to balance out the decrease in value.
ReplyDeleteBill Connors
Former Evansville City Administrator
Nice explanation. Thank you.
ReplyDelete