3/5/14

Just the facts

Loudoun Historical Tax Bill and Rate from page R-6 of the FY2015 Proposed County Budget
One of the final speakers at Saturday's public hearing on the budget suggested a compromise between fully funding the School Board budget at the $1.215 tax rate and cutting the proposed School Board budget by $40 million at the $1.155 equalized tax rate. He suggested keeping the $1.205 tax rate. Following this, Chairman of the Board of Supervisors Scott York said:
I just want to correct one thing that has been said that is not factual in this that needs to be said: "Keeping the tax rate at $1.205 is not a tax increase.” 
If we kept the tax rate at $1.205, it is not an increase in the tax rate — that is correct — but it is a tax increase. That’s why we go through the process to find out what equalization is, and equalization of what today’s $1.205 is, is at $1.155. That is the value of the revenue that we would raise under last year’s property values. 
The difficulty that the Board does have and faces every year is the impact of its decision on the budget. At $1.155, which I’ll just now represent as equalization, for many people can be a tax burden decrease. For many people, at equalization, they’re out of the box at $500+ an increase in tax burden, because unfortunately some folks assessments have gone up anywhere above 8%, and I’ve heard as high as 18%. So we have to keep in mind, not only to ensure that we fund the services in Loudoun County, but that we also try to ensure an affordable community for folks to live in and it is a delicate balancing act. 
So, just note, again, that $1.205, if we left it there, it is a tax increase. That’s just fact.
This is another great example of a member of the Board of Supervisors complaining about people getting their facts wrong, when it's really a matter of perspective.

Taxing a value at the same rate is not a tax increase due to the value being increased. If your income tax rate is 28% and you get a raise, the federal government did not raise your taxes, even though you'll pay more on your income tax bill. Likewise, the county is not increasing your taxes if they keep the tax rate flat and your property value increases. Yes, your property tax bill will increase, but the county did not raise your taxes.

As you can see in the above chart, taken from the proposed county budget plan, this Board has lowered both the tax rate and the average tax bill for the past three years. If the Board were to maintain the current tax rate, the average taxpayer would pay less than they paid in FY09, FY11, and FY12. If you want to see the affect of raising the tax rate one cent on your tax bill, try out this tax calculator.

Many people also do not consider it "unfortunate" that their property values have increased. Instead, they appreciate the housing recovery and its affect on the equity in their home.

You can sign up to speak at the public input at the regular Board of Supervisors meeting being held today, March 5, at the Loudoun Government Center in Leesburg by calling (703) 777-0200 by noon today or signing up when you get there. Public input starts at 6pm. Remember to email your supervisors at loudounbudget@loudoun.gov as well.

To view Mr. York's comments yourself, see go to the 2:01:15 mark of the video online.

1 comment:

  1. Here's a graphic in today's Washington Post showing data similar to your graph.

    In relation to the other jurisdictions. Loudoun County does have the highest real estate tax rate in the region, but our current and prior BOS has reined that in. If you focus on our average tax bill, it makes sense that our per-taxpayer expense might have been able to decrease, because we have much housing development (with its increasing tax base) here. But our BOS is arguing that they can't fully fund the schools due to the rise in individual tax bills. This, if accurate, would indicate otherwise. (It would rise, but only slightly, if the BOS were to adopt the advertised rather than the equalized tax rate.)

    http://apps.washingtonpost.com/g/page/local/tax-bills-climb-with-home-values/874/

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