Here's the expected annual story about the Janesville City Council approving the city budget.
According to the Gazette, City Manager Mark Freitag credits Dollar General and other projects for growth in the city's assessed value, yet the average tax bill from the city's portion of the property tax statement will rise $50 for the typical homeowner.
JG Excerpt:
A municipality can increase its tax levy only by the percent increase of net new construction. Dollar General and other projects have contributed to Janesville's 2018 net new construction increase of 2.73 percent, City Manager Mark Freitag has said.
Of course there are a few problems with that statement.
First is; although Dollar General does "pay" a property tax bill, very very little of it goes to the city's General Fund. Assessed values of any new construction inside TIF Districts are not added to the city's total taxable value until the TIF District expires.
To put it another way, since most of the city's "growth" is inside TIF Districts including Dollar General, they contribute absolutely nothing to taxable net new construction. That includes the giant Downtown TIF District whose assessed values are frozen in time for the next 26 years.
Property taxes collected from downtown property owners will continue to go up, but the portion going to the city in 2030 will be the same as it was in 2017. The rest of us chumps will have to make up the difference.
Secondly; "A municipality can increase its tax levy only by the percent increase of net new construction," is true, but it's not the whole truth. Municipalities can also increase its tax levy by the same percentage in rising property assessments. In other words, rising property assessment value equals net new construction in the eyes of the city tax adjuster.
Think of it this way: There's a reason why your home's property tax bill has gone up dramatically since 2010 and it's not because of new construction.
Sadly for both the City Manager and the Gazette, neither bothered to touch on or credit residential property assessments as the primary driver of taxable growth. While some of the city's biggest business players have lawyered up to have their property assessments cut in half, the rest of us chumps will have to suck it up watching our property tax assessments climb. We're the little people.
Freitag's boast about new construction growth in the city doubling in the past year is little more than a self-ingratiating account. Because if city new construction grew from 3.3 percent to 6.8 percent in a year results in raising the tax rate from $8.82 to $9.24 per $1,000 of assessed valuation is something glorious to behold, then we must believe broadening the base leads to raising the rates.
And THAT my friends is going backwards.
ADDITIONAL:
RNR - Use Janesville's $583K Earmark For Dark Store Relief
RNR - Janesville's Dark Store Community Grows
No comments:
Post a Comment