Transcript What are Property Taxes?

What is the proposed ballot issue?
Referred measure 3B: Increased funding
for education in School District 51 only
Shall taxes on peoples’ property (house, land, or business) in
School District 51 be increased 7 mills for six years to
raise $12.5 million each year? (Example: homes valued at
$100,000 would have about an additional $55.72 added
taxes each year.) These funds will go directly to School
District and would be used for but not limited to:
◦ Rehiring teachers and restoring the days that have been cut
◦ Purchasing technology to improve instruction
◦ Help ease future cuts
What is proposed?
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Raise property taxes on peoples’ property (house,
land, or business) only in School District 51
Raise the school district mill levy by 7 mills
Raise $12.5 million each year for 6 years
These funds will be used for but not limited to:
◦ Rehiring teachers and restoring the days that have
been cut
◦ Purchasing technology to improve instruction
◦ Help ease future cuts
How much will it cost?
It will raise property taxes on people who
own property (house, land, or business) in
School District 51.
How much it will cost each person depends
on the value of their property.
The monthly tax impact is about $4.62 per
$100,000 of a home’s market value.
Why did the school board put this
on the ballot?
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School District 51 has been forced to cut its budget by
approximately 20 percent over the past three years, totaling
$28 million, due to less funding from the State of Colorado.
A loss of additional funding from the State is expected for
the 2012-13 school year.
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To balance the budget, District 51 has reduced more than
70 administrative and support positions, reorganized
services and departments, and cut 80 teaching positions
resulting in higher class sizes. Staffing has decreased while
the same numbers of students continue to enroll and state
requirements increase.
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To help minimize the impact of the cuts and anticipated
future reductions in state funding.
What do those who oppose this
say?
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Schools can be run using less money so
there is no need to raise taxes.
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Adding taxes at this point will make it
difficult for people to spend money
elsewhere and to help the economy.
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Businesses are already having a tough
time and will do worse with an added tax
burden.
What do those in favor of this
measure say?
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Schools need money to effectively teach
what needs to be and is required to be
taught.
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The funding that has been cut already has
made it difficult to teach students effectively.
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Paying now to educate students will help
businesses in the long run by creating an
educated workforce and will help attract
businesses to the area.
What are Property Taxes?
Property taxes are the taxes the owner of the property
is required to pay to support the government where the
property is located.
The property tax rate is usually given as a percentage of
the value of the property. This is known as the mill levy.
Forms of property tax can vary depending on the
location.
Are Property Taxes the same as Income Taxes?
No.
Income taxes are based on how much
money you earn.
Property taxes are based on the value of
the property you own.
There are three types of property:
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Land
Improvements to land (such as buildings)
Personal property (such as boats and RVs)
Real property (also called real estate) means the
combination of land and improvements. This
would be most homes.
Under a property tax system, the state requires an
appraisal of the monetary value of each property,
and tax is assessed in proportion to that value.
How is property value determined?
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The actual value is the amount it is estimated
it could be sold for, called the market value.
The actual value is based on sales that
occurred within the last 18 month period.
Those sales indicate the market value of
specific types of properties.
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For other nonresidential types of properties
or others of an unusual nature (of which
there are few), other methods are used.
Can they just raise taxes?
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The amount of tax raised can't automatically be adjusted to
account for inflation or increased enrollment. Thus, school
districts must go back to the voters on a regular basis to
ask to override the current mill levy in order to keep up
with inflation and growth.
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Colorado taxes provide some funds for school districts. The
state law directs how school districts can get additional funds for
operating schools.
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School districts are allowed to add operational funds by asking
voters to raise or override their mill levy.
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When a school district has capital needs, such as updating
buildings or constructing new buildings, the funding mechanism is
a bond issue. Bond issue funds can NOT be used for operational
expenses, which include salaries.
Who sets the Mill levy?
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Mill levies are set each year by taxing
authorities such as school districts, the
county, cities, fire, water and sanitation
districts, and others.
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These entities provide tax-supported
services and are listed on a tax notice.
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The County Assessor then sets the
assessment rate to cover those services.
How are property taxes calculated?
Property Taxes =
Actual Value X Assessment Rate X Mill Levy
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The assessment rate on residential properties is a little
less than 8% in Mesa County.
The assessment rate on nonresidential properties is
fixed by law at 29%.
Example 1:
For a home valued about $100,000 the
proposed increase of 7 mills would be
$100,000 x 8% assessment x 7 mills
which is
$100,000 x .08 x .007 = $56 in new taxes
per year or $4.67 per month
Example 2:
For a home valued about $150,000 the
proposed increase of 7 mills would be
$150,000 x 8% assessment x 7 mills
which is
$150,000 x .08 x .007 = $84 in new taxes
per year or $7 per month
Figure your own:
Determine your home value H
$ H x 8% assessment x 7 mills
which is
$ H x .08 x .007 = $____ in new taxes per
year (divide by 12 for monthly amount)