Guest Column: Property Revaluation 101
By Sandy Semans Ross
County’s current $101 million budget is funded with a variety of
sources, including federal and state money, grants, fees collected, and
tax revenues derived from property taxes.
Property tax revenues
in the current budget total $49 million, slightly less than half the
amount needed to pay for the total current budget that expires on June
During the last few years, foreclosures, the
recession, and damage and/or loss of properties from storms has forced
property values down from $17 billion to $12 billion.
current tax rate of 28 cents per $100 is applied against the total of
the new property values, the resulting revenues would be just $33.6
million – a $15.4 million shortfall in supporting the current budget of
State law mandates that local governments must
determine the “revenue neutral” rate each time that there is a
revaluation conducted. That rate is what it would have to be in order
to collect the same amount of property taxes as those used to support
the current budget.
Dare County announced this week that the
revenue neutral rate based on the new property tax base is 41 cents per
$100 of value – an increase of 13 cents.
Because the dip in
property values has varied widely between locations and such factors as
whether properties are oceanfront or mainland, the resulting tax bills,
if based on the revenue neutral rate, would be higher for some, lower
The property tax base decline is 29.1 percent
countywide but ranges from 22 percent decrease in values in Manteo to a
43 percent decline in Salvo. The higher the decline, the lower the
resulting projected taxes.
But even if you understand thus far,
you still don’t know what your taxes are going to be next year! That
will depend on how county officials budget for the new fiscal year
beginning July 1, 2013.
Although unlikely, if they budget to
spend less next fiscal year, the 41-cent rate could drop; if the new
budget increases expenditures over the current budget, the rate could
The new values set on individual properties are
scheduled to be mailed to property owners on Feb. 25. Those who
disagree with the value placed on their property will have the
opportunity to appeal.
And appeals shouldn’t just be sought by
those who think that their homes are valued too high. There also are
pitfalls for those whose properties are valued too low.
Hurricane Irene, problems surfaced for some who had the proper amount
of coverage so that they could replace their home or to pay off their
loan. But, although they enjoyed a few years of low taxes based on a
too-low tax value, it cost them in the long run.
dictate that if damage is more than 50 percent of the value of the
structure, the property owner must agree to raise the building before
the county can issue a building permit. And what does the county use to
determine a house’s value unless a recent appraisal is available? Tax
You can see that if your tax valuation is too low, you
will more quickly reach that 50 percent mark and perhaps be forced to
raise your house or structure, even if you don’t need to.
new valuations also will apply to the special tax districts used to
support community centers and fire departments. Revenue neutral rates
haven’t been announced yet for the individual districts but can be
expected to increase about 30 to 43 percent above current rates to
garner the same tax revenues.
So your head is swimming with all this tax stuff? There’s more.
who allow their mortgage companies to take care of purchasing their
insurance coverage should contact the mortgage-holder and make sure
that they don’t insure the house based on tax value.
value and tax value are rarely the same amount. Tax values are usually
much less, which could translate into a major problem if the home is
damaged or destroyed. Tax value also is often less than the mortgage
owed on the property.
Unfortunately, some Dare County homeowners have learned this lesson the hard way following major storms.
a number of cases, insurance coverage provided through their mortgage
companies would neither replace the home nor pay off the existing
A good practice is to ask the company to send copies
of all the policies insuring property so that the property owner can
check to make certain that their structure is adequately covered.
Frequently, homeowners also have found that they had no contents
Semans Ross, former managing editor of The Outer Banks Sentinel, is a
freelance writer who lives in Stumpy Point. You can read more of
her blogs at www.sunshineobx.blogspot.com.)
FOR MORE INFORMATION
Presentation of tax assessor on revaluation at Dare Commissioners’ meeting on Feb. 18: http://www.darenc.com/news/2013/id_281b.pdf
Sample revaluation notice: http://www.darenc.com/news/2013/id_281a.pdf
Revaluation FAQs: http://www.darenc.com/tax/apprfaqs.asp