NCPA - National Center for Policy Analysis

SLOWING PROPERTY TAX BOOSTS

July 14, 2004

Nationwide, property taxes -- used to fund everything from police and fire departments to schools and recreational services -- rose an average of more than 10 percent between 2001 and 2003, estimates Joseph M. Mulcahy of Deloitte & Touche LLP's Property Tax Services Group. In some municipalities, he says, home assessments have gone up between 20 percent and 50 percent.

In response, voters have organized efforts to repeal or slow property-tax boosts in states from Virginia to Oregon, in some cases with the support of frustrated local officials:

  • A group called Virginians Over-Taxed on Residences, or VOTORS, is pushing for a constitutional amendment that would reset property values to their January 2000 level.
  • Earlier this year, voters in Oregon recalled an $800 million tax boost, which included increases in property taxes, passed by the state legislature last August to plug a hole in the state's budget.
  • In Maine, a group called the Maine Taxpayers Action Network, is pushing to get an initiative for a 1 percent property-tax cap on the November ballot.

Meanwhile, state legislatures in Illinois and South Carolina, in response to citizen outrage over high taxes, recently passed bills limiting increases in property-tax assessments. On Monday, Illinois Gov. Rod Blagojevich signed legislation intended to slow the rate of increase in assessments.

In Clark County, Nev., which includes Las Vegas, Tax Assessor M.W. Schofield has called on the state legislature to limit to 6 percent the maximum annual increase in assessed home values. Land prices are rising so fast in the county that, without a cap, property tax bills next year are likely to shoot up 20 percent to 50 percent, depending on the neighborhood, says Michele Shafe, assistant director of the assessor's office.

Source: Ray A. Smith, "Property-Tax Rise Triggers Backlash in Some Areas: Homeowners, Legislators Move to Limit Big Increases Used for Funding Shortfalls," Wall Street Journal, July 13, 2004.

For text http://online.wsj.com/article/0,,SB108976284035563030,00.html?mod=home%5Fpage%5Fone%5Fus

 

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