According to Tiverton’s tax assessor, David Robert, the town’s new tax rate will be $19.14. That’s down from $19.30 in the current year, despite a town-wide property revaluation that drove rates up.
Residents who followed the budget debate may recall that Budget #2, the 0.9% budget, came with an estimated tax rate of $18.99, while the rate presented for Budget #1, the Budget Committee’s 2.9% budget, was estimated to produce a $19.37 rate. According to Robert, the difference was that the increase in the total value of town property turned out to be lower than estimated.
In both budgets, the assessor had estimated a real estate value increase of 2.5%. After completion of the revaluation and an initial hearing process by Vision Appraisal, the actual increase turned out to be 1.6%.
For any families that managed to reduce the increase in their appraisals, that’s a good thing. For taxpayers as a whole, however, it is not, because it means that there are fewer new taxpayers and our property isn’t increasing in value as quickly as we would like.
As previously explained, municipal governments set tax rates backwards; they start with the total they want to collect and then figure out what rate people have to pay. In general, if everybody’s property increased in value by the same amount, the rate would go down, but our tax bills would stay the same because our houses would be worth more. Conversely, if everybody’s property value decreased, the rate would go up, but it wouldn’t change our bills.
Property values did, overall, go up, so the rate would have gone down. However, the town’s requested budget estimated that values would go up even more than they did, making the rate for Budget #1 look lower than it actually would have been. If Budget #1 had been approved, the town’s tax rate would now be $19.54 — an increase of $72 for a $300,000 house.
Instead, Budget #2 dropped that house’s payment by $48, so the taxpayer who owns it saved $120 per year.