How does the county determine property’s ‘true value’?

Published 6:14 pm Monday, January 27, 2020

We are well into January now, and after the joys of Christmas and the revelry of New Year’s a sobering reality sets in. Bleak winter weather, faithless resolutions (diet time, boy!), and for us homeowners the dreaded necessity of paying property taxes. Not much I can do about the weather or — try as I might — my expanding waistline. And although I doubt I’ll find a remedy for my tax burden, I can at least try to make sense of this annual ordeal, and so make the process more palatable.

Let me begin with these disclaimers: I consider myself a good citizen. I vote, give blood, donate to charities and pick up trash from the roadside. I am neither a libertarian nor a TEA Party supporter; rather, I believe in the government’s right to tax us and that we have an obligation to comply. Indeed, we should want to pay our taxes; how else could we get certain vital services that cannot provide for ourselves? Think: education of our children, police and fire departments, the infrastructure that we all depend on, and much, much more. For these services I am more than willing to pony up my fair share of tax dollars. My complaint lies with the method by which this “fair share” gets calculated.

I believe we have a civic obligation not only to pay our taxes but also to question this method.

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The formula for property tax assessment is reasonably straightforward: millage rate x assessment ratio x true value = tax owed. I understand that in order to raise the revenue the county needs for its various projects it must adjust the millage rate accordingly. The assessment ratio coefficient (10 or 15 percent) seems arbitrary, but I suppose there’s logic behind it. It’s the third component — true value — that throws me.

My situation may not be typical of Lincoln County homeowners, but I believe it will resonate with many. In addition to our tax-exempt homestead, my wife and I own three small rental properties in what may charitably be described as a depressed part of town. To give some idea of just how modest they are, the total we paid for these properties barely exceeded $100K. This year our tax burden amounted to nearly $2,500 — roughly 4 percent of our initial outlay. One property (the least expensive) saw an increase of nearly 30 percent. And of course, the taxes on all three go up every year.

The tax assessor’s office assures me that the increase in valuation for these dwellings is due to the rising fair market value in that quadrant of the county. That quadrant includes the fancy homes on South Jackson and Moreton Estates as well as the humble clapboard dwellings in less desirable subdivisions.

Really? Does any real estate agent or appraiser honestly believe that all properties appreciate at the same rate? Do the county’s appraisers actually take a good hard look at each property in their purview, as required by law? Or do they simply apply the same formula across the board, and decide upon its “true value”? Kinda arbitrary, if you ask me.

Hey, I’m all for prosperity and a healthy real estate market, but a rising tide doesn’t necessarily lift all boats. Some, like mine, aren’t all that seaworthy. Wouldn’t it make more sense and be fairer to have brackets for property tax like we do for income tax? The more your property is worth, the higher percentage in taxes you owe. Simple, and yet impossibly impractical. Because until the county can figure out a way to determine a property’s “true value,” the system will plod on, churning out cards every January that tell us how much our most prized possession — our home — is worth. And we’ll continue to take their word for it.

As for why the county always seems to need more money every year? Don’t get me started. . .

Eric Kaplan, Bogue Chitto