On June 9 the West Hartford Town Council voted to halt the 2006 revaluation 5 year phase-in after the State Legislature passed legislation to allow towns to freeze the revaluation phase-ins that towns in CT had been engaged in. See complete legislative bill details here.
Representative Beth Bye was the only West Hartford legislator to co-sponsor the legislation, although she was absent from the House floor vote along with Rep. Andrew Fleischmann. Rep. McCluskey voted for the measure, and in the Senate, so did Jonathan Harris.
West Hartford Town Manager, Ron Van Winkle said in his explanation at the Town Council meeting, that 75 percent of all homeowners will get a tax break in July because of the cessation of the phase-in. Property owners will be taxed based on the 2007 grand list to figure next fiscal year's taxes. He also mentioned that the vote allows the Town to move forward to send out tax bills to residents and prevent a delay. A delay could have caused problems for the town. The mill rate was 36.97 last year and was supposed to be 34.81 with the phase-in. Nothing on the Town website indicates if there will be a change in the mill rate, although the Town tax calculator comes up with 37.54. (This has to be clarified)
Councilors voted 8-0 on the measure with Councilman Steve Adler abstaining because he felt he did not have enough information on the pros and cons of the issue, especially in light of a document presented by Town resident Robert Sisk regarding the impact of halting the phase-in. (Mr. Sisk was kind enough to forward Talk of West Hartford the document which is now available on Scribd).
Property taxes will now be a little bit less for many residential homeowners, but the freeze on phase-in affects commercial property since the shift of taxes was being placed away from them with revaluation phase-in and that has now been halted.
When houses were re-assessed in 2006, it was at the height of the real estate market, and since then some people had complained that they couldn't even sell their house in the current market for what their house was valued/assessed at. How our property taxes are calculated according to Town Charter and State Law is that the town
1. does a market valuation of your home - either physical, where they come out to actually look at the features and aspects of your home - or statistical, where they more or less apply an overall percent increase or best guess to the value based on the documented features of your home
2. Takes that market value and multiplies it by 70% yielding an assessment which is then applied to the mill rate.
So if your house is valued at $200,000, your assessed value is $140,000. The mill rate is then applied to that assessed value, divided by 1000 and that is how the tax bill is calculated. With the phase-in, the difference between the 2005 market value assessment and 2006 market value assessment of the property was split up into phased in amounts which were to be applied every year until the phase-in was completed. In West Hartford's case that would have been 2011.
Since the phase-in is to be halted, homeowners will be paying taxes on the same assessed value as they did last year (based on the 2007 grand list). This year the only difference will be as a result of applying the mill rate, and not the mill rate plus a phased-in increase in assessed value over last year. This gives property owners a little bit of relief (depending on what the mill rate is).
Critics of the way in which we currently tax property claim that taxing based on market value of property is inherently flawed because homeowners are paying taxes on unrealized capital gains. That is to say, you may be paying higher taxes on a price of your home that can be inflated due to the market conditions. In fact, many homeowners may not be able to sell their homes for the value that they are currently paying taxes on! That is a problem, and amounts to over taxation.
In any case, this move by the legislature and by the Town of West Hartford could be a bit of relief for tax payers until the next revaluation is done.
The real issue regarding higher taxes however, rests more with how much the Town is spending as well as how much they are collecting in non-tax revenues, as both determine how much the homeowners and commercial property owners must make up to cover the cost of running Town services and administration. Keeping Town spending under control and getting the best use of every tax dollar should certainly be the aim of Town elected leaders and administrators.
It's interesting after this past budget cycle that the Town ended up with a budget surplus. It looks like after much budget searching for savings, and now halting revaluation that our Town is doing well. What is still puzzling is how the Board of Education who originally cried that they could not find a slim dime to cut from their budget, and who had heated feelings for the Mayor who took a hard line with them, ended up finding millions of dollars to apply to their budget afterall so that cuts wouldnot have to be made. It looks like that GEICO pile of money just showed up! How fascinating.
That's good news for taxpayers.
But just remember - this is an election year.
Let's hope and pray we don't get slammed with higher spending and even higher taxes next year.
2 WH Responses:
I note that Mr. Sisk clearly takes a dim view of the suspension of the revaluation phase-in, and advocates for more frequent, rather than less frequent, revaluations.
I share both sentiments, and would be interested in the perspectives of other commenters here.
In 1994, I built a new home in WH. When I finished I had it appraised for a line of credit with the bank.
The assessement from the town was more than the appraised value from the bank.
When I questioned the town I was told that even though home prices had dropped from the 1989 peak which was the last assessment, my home was assessed on the basis of the 1989 values.
I was told that it would be unfair for me to receive an assessment based on more current values while all other taxpayers would have to wait until the 1999 revaluation.
When the 1999 revaluation was done my assessment did in fact go down as did other homes.
The town is using revaluation as a scare tactic to hide the real problems with spending in the town budget.
Because they did not want to address the problems in 2006 and 2007 they came up with the phase-in to keep the increase in taxes to a then pallatable figure.
They want everyone to believe that if the economy hadn't slowed down that things were just great. The fact is we couldn't sustain the level of spending and 7% tax increases each year even in a better economy.
Now they want everyone to praise them for addressing some of the issues, although they fail to adress the biggest issue of salaries and benefits.
There is no difference between what is happening with home prices now and what happened between the 1989 and 1999 revaluations.
The difference is this town council wants to be be praised when home prices are going up and when they are going down as well. All this so they can blame it on revaluation and take everyone's eyes off the real problem of spending.
Get the spending under control and the impact of revaluation swings is lessened.
Post a Comment