| 2009 School Tax Rates
Local support: Maintenance & Operations Levy
$2.37 per thousand
Local support: School Construction Bond
$1.71 per thousand
Property Tax Explanation
Changes in home values don’t change the amount of school taxes authorized.
Imagine a small school district that consists of four homes, each exactly the same, and each appraised by the Assessor at $100,000. Let’s also say that the district’s capital project bond for our district is $1,000. To raise the amount of the bond, each homeowner must pay $250. Four homes each paying $250 raises $1,000.
$1,000 Capital Projects Bond
Increased assessed value doesn't increase taxes.
Let’s say the bond amount remains at $1,000, but the Assessor doubled the assessed value of all the homes to $200,000 each. Do the taxes on each of the homes change? No.
To raise the authorized bond amount each must still pay $250. In this example, the assessed value of each home doubled, but the tax didn’t change.
$1,000 Capital Projects Bond
What happens when the assessed value of the homes change differently?
Suppose on home goes from $100,000 to $150,000. Two homes double in value to $200,000 and the last home jumps up to a whopping $250,000! Now what happens to the taxes?
Well, the average value of the four homes is still $200,000. So the taxes on the two homes that go to $200,000 are unchanged. They are at the average and they each still pay $250.
The lowest valued home sees it taxes go down to $187.50, even though the assess value goes up 50 percent!
The home that jumped 150 percent to $250,000 in value sees its property tax go up to $312.50, a 25 percent increase.
In the end, we still only raise $1,000 total to meet the bond obligation.
$1,000 Capital Projects Bond
What happens when new people move into our small school district and build new homes?
If we again say the assessed value of each home is the original $100,000 but add a new home, look what happens to the individual property tax on each home. Five homes supporting the $1,000 bond means each home now pays only $200 each.
While growth brings more demand for government services, and is likely to push up demand for a greater budget, the initial effect is decreased taxes.
$1,000 Capital Projects Bond
Bottom Line
• If your property value increases at a lower rate than the average increases for the school district, the amount of taxes you pay will decrease. • If your property value increases at a higher rate than the average increase for the school district, the amount of taxes you pay will increase. Presentation provided by D.A. Davidson & Co. |
