Property tax increases could be sizeable
Staff writer
Despite some officials’ claims that exceeding revenue-neutral rates will cost taxpayers as little as $1, the impact could be much larger.
For a taxpayer who owns a home appraised at $100,000, here’s how much annual taxes would increase in jurisdictions that have said they plan to ignore revenue neutrality:
CITIES
Burns $134.84
Hillsboro 50.12
Lincolnville 48.13
Marion 76.46
Peabody 61.48
Tampa 36.52
SCHOOL DISTRICTS
Centre $25.50
Durham-Hillsboro-Lehigh 11.80
Marion-Florence 21.69
Peabody-Burns 6.65
TOWNSHIPS
Risley $ 5.89
FIRE DISTRICTS
Clear Creek $ 26.00
Peabody 2.36
West Branch 2.73
IMPROVEMENT DISTRICTS
County lake $ 4.69
RECREATION COMMISSIONS
Hillsboro $ 0.90
Marion-Florence 0.62
Peabody-Burns 3.48
HOSPITAL DISTRICTS
St. Luke $ 3.42
The owner of a $200,000 house would pay twice these amounts. For a $50,000 house, it would be half these amounts. Businesses pay more — 2.17 times what residences do.
Increases would be additive. For example, a Marion resident with a $100,000 home would pay a total of $102.19 more because of the combined effects of city, school, recreation, and hospital increases.
Most county taxing units chose to keep their budgets at revenue-neutral rates. The increases listed here are for those that notified the county clerk that they would exceed revenue neutrality and that provided her a specific proposed tax rate in excess of the unit’s revenue-neutral rate.
Revenue-neutral rates are the mills a governmental unit levies if it wants to get the same amount of money as it did in the previous year. Exceeding revenue neutrality means increasing the amount of tax the unit collects.
Revenue neutrality is designed to prevent taxpayers from being deceived by claims that taxes haven’t increased because the number of mills levied has stayed the same.
Even if a tax rate stays the same, an individual taxpayer might have to pay considerably more because the appraised value of his or her property increases.
Increases in appraisals can be substantial even if properties are not improved.
In Marion, for example, a typical home that was valued at $100,000 last year was valued at $115,000 this year, despite no improvements being made to the property.
The 15% increase in appraisal would result in a 15% increase in property taxes unless tax rates were adjusted.
Revenue-neutral rates are designed to make that adjustment and prevent hidden inflation of tax bills.
The proposed tax rates that were used to make the calculations in this story were supplied to the county clerk earlier this month by clerks or other responsible officials within each taxing entity.
Those officials were required to notify the county what their anticipated tax rate might be and whether it would violate revenue neutrality.
How thoroughly each unit examined budgetary needs before reporting its estimated tax rate varies widely.
In Hillsboro, for example, city council members spent weeks studying and eventually voting to propose a detailed budget exceeding revenue neutrality.
In Marion, on the other hand, the public and city council members saw no budget information in advance of the city listing its estimated tax rate.
City Clerk Janet Robinson merely told the county clerk that, despite reappraisal, the city probably would stick with the same tax rate as it imposed last year.
The city council voted to notify the county it might exceed revenue neutrality but did not vote on the specific rate Robinson supplied.
Whether voted on or estimated without official action, none of these tax rates are final.
After providing revenue-neutrality notices to the county, taxing units propose specific budgets that may include different estimates of what tax rates might be.
These budgets are not officially adopted until after each taxing unit conducts a public hearing at which taxpayers are allowed to ask questions or protest proposed spending plans.
None of the taxing units proposing to ignore revenue neutrality has yet conducted its hearing.
After their hearings, units will adopt final budgets. These will include tax levies — total amounts the units want from all taxpayers as a group. They also will include final estimates of what tax rates would bring in those amounts, but actual rates will not be set until well into fall, after various assessment appeals are concluded.
Typically, estimated tax rates approved after budget hearings in August and September increase slightly before final tax bills are sent out in fall.
Under law, the county must mail a notice to each taxpayer listing the time and location of budget hearings for units considering exceeding revenue neutrality.
Although many like to complain about taxes and the level at which governments fund various projects, few typically appear at budget hearings even though they are the only opportunities citizens have to influence those decisions.