Tax reduction good for homeowners, tough on county
People whose property values are falling might receive some
relief on their property tax bill, but the county budget will pay
the price.
Tax reduction good for homeowners, tough on county
People whose property values are falling might receive some relief on their property tax bill, but the county budget will pay the price.
Tom Slavich, the county assessor, will reduce the value of about 2,000 homes by an estimated $100 million. There are about 19,500 homes in the county.
Last year, Slavich reduced the value of about 432 homes in the county by $15 million.
“It’s going to be a tight year, there’s no question about it,” said Susan Thompson, the administrative officer for San Benito County.
Property taxes make up the largest chunk of the county’s local discretionary budget, Thompson said.
“The next largest is sales taxes,” Thompson said, “but it pales in comparison to property taxes.”
Although money from property taxes will decrease, costs are increasing, Thompson said.
“Fuel alone is an issue,” Thompson said. “Your revenues need to keep up with that. If they don’t, then you have to make reductions.”
Property taxes make up nearly 8 percent of the city’s budget, said Clint Quilter, Hollister’s city manager.
“It certainly adversely affects it, but it’s not a lion’s chunk of our budget,” Quilter said. “It’s not a huge piece for us, which is a good thing when they go down, but it’s a bad thing normally.”
Property is taxed at one percent of its value, Slavich said. Of that, county staff receive 11 cents and cities receive 2 cents. The bulk, 66 percent, goes to schools.
City and county staff will receive more money from property taxes this year than they did last year, Slavich said.
Even in a declining market, the total value of homes in the county can still increase, Slavich said.
“Property taxes are the most stable form of income,” Slavich said. “There’s still new construction. People are adding on, remodeling.”
There is also an increase when homes that were purchased in earlier decades are sold, Slavich said.
The county assessor’s job is to establish what the price of a parcel was on January 1.
Assessor staff will evaluate the value of every home purchased between 2004 and 2007. Prices were at their peak during 2005.
“If you bought it at the extreme high peak, you’re going to get the largest reduction,” Slavich said.
Larger counties use computer programs to establish the value of homes, Slavich said.
“We’re going to be looking at them on an individual basis,” Slavich said.
To evaluate what the market value of a house was on Jan. 1, staff will compare the parcel to similar properties.
The depreciation of prices in the neighborhood, the lot size, square footage of the house and condition of the house will be taken into account.
“It’s a big job to do,” Slavich said.
Staff will mail notices to people whose houses are being evaluated.
“When people get those notices, they can still come in,” Slavich said.
Staff will explain the process to homeowners who have questions, Slavich said.
If homeowners disagree with the assessment, they can bring the assessor any documentation that helps establish what the value of their house was on Jan. 1, Slavich said. The documentation must be from the appropriate period.
Homeowners can also challenge the assessment in court, Slavich said.
“We try to avoid that,” Slavich said, “because we want to make sure we do the best job we can.”
