The gazette story doesn't explain things well.
The story says that the property values delined and referenced lower assessments. No where in that story did it say that Nisky did a complete, townwide reassessment of all properties. The gazette failed to explain whether the lower total assessment is due to individual homeowners--in large numbers--filing and winning assessment grievances OR whether the rich commercial properties filed and won grievances.
When the big rich commercial properties win grievances to lower their assessment, it causes the tax BILLs of the homeonwers to rise IF the tax LEVY stays the same. Of course as the article states, the LEVY has icreased too.
Need to understand this. And the title of the story is deceiving too. It says property values deline so tax RATE increases.
Hope you can take this in.
If a tax RATE (per thousand) was, say, $12. AND IF a municipality reassessed all properties downward by 50%, then even without an increase in the tx LEVY. there would be an increase in the tax RATE to $24. But peoples' tax BILLS would remain IDENTICAL.
If a tax RATE (per thousand) was, say, $24, AND if a municipality reassessed all properties upward by 50%, then without any change in the tax LEVY, there would be a reduction in the tax RATE down to $12. But the peoples' tax BILLs would remain IDENTICAL.
I will clarify further, those two statements above one step further. I used the example of 50% increase in assessed values and in the second a 50% decrease. The clarification is that in this example the assumption is that each and every property had their assessment increased by 50% (and decreased by 50% in the second example). If that was the case, then it would be conceivable that the tax BILLS would be IDENTICAL.
There are so many variables. If the TOTAL municipality wide ASSESSED VALUE drops by 50%, AND IF the tax LEVY stayed the same, then the tax RATE would exactly double, but the tax BILLs would vary depending on the reduction in one's individual property assessement. Remember, in the absense of a municpality wide reassessment, only some homeowners will fille a grievance.
The tax LEVY is the amount that must be collected in property taxes. A budget CAN be increased yet the tax LEVY stays the same IF the muni gets revenue from other sources to cover it's increased spending.
A muni can reeduce it's budget, reduce it's spending, yet increase the tax LEVY.....IF other sources of revenue a reduced (e.g., state and fed aid).
The tax LEVY can stay exactly the same but the tax RATE can increase if the total assessed value (of all properties combined) is reduced, and individual homeowners tax BILLs will vary depending on if they were personally affected by an assessment reduction----sometimes by the muni-wide reassessment and then further by their own grievances.
The tax LEVY can be reduced if a muni has incrases in other revenue or reduces its spending but a sizeable reduction in property value can still push up the tax RATE,
Hope you are thoroughly confused.
Putting together a spreadsheet and taking a hypothetical 20 residential property assessments and 5 commercials, you can make changes to inidivdual property assessments, or all by the same percent, and then imagine changes in the LEVY. You would see how the tax RATES and tax BILLS change based on the Total Assessed Value.
Then you need to factor in exemptions. Just put those 20 residential properties of $200,000 assessments and make the commercial properties have $10,000,000 asssessments and then go and change the assessments of the commerical properties to 0 because of 100% tax exemptions....like the millioniares downtown get.....and watch what happenes to the homeonwers tax BILLS.
This can be mind boggling to figure out, "how come if this happens to the rate, then why does that happen to the bills" etc
Logged
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