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Property taxes holding steady

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By Robin Bass

City and county residents will see little change in their property tax statements if officials continue with their plans to maintain the current rates at 14.8 and 8.8 respectively. If approved, this will mark the fourth year in a row that city real estate taxes will have remained constant, and the third year for property in the county.

At the rate of 14.8 cents per $100 of assessed value, the city of Taylorsville expects to collect about $129,000 – roughly $800 more than the previous fiscal year. Spencer County Fiscal Court anticipates generating $871,500 with their rate of 8.8 cents per $100 of assessed value – almost $12,000 more than in FY 2010.

“I don’t think we need a tax increase at this time,” said Taylorsville Magistrate David Henry. His sentiments echoed that of most magistrates and commissioners last week. Many said they were hesitant to increase taxes at a time when homeowners were struggling with high unemployment and an uncertain future economy.

The only official to pose a different revenue strategy was Magistrate Bill Drury.

“I would rather see us take the increase (in property taxes) and then decrease the occupational tax,” said Drury.

The Campbranch magistrate suggested that by approving a state-allowed 4 percent increase, the owner of a $150,000 home would see his property taxes go up from $132 to $136.50. If fiscal court would instead approve the increased rate of 9.1 cents per $100, Drury said the county would collect an additional $29,700.

“If this county is in need of money, and it is, then taxation should be fair. When I asked one county employee how much he paid in occupational taxed last year, it was over $350. Compare that to a $4.50 increase,” said Drury.

Drury said that while it may appear on the surface that he wants to raise taxes, his over-reaching goal is to lower them. By passing a higher property tax rate, Drury said that fiscal court could continue their original promise to lower occupational taxes for people that work in the county.

“When they (fiscal court) put this tax on, they said they would lower it and find alternatives,” said Drury. “Have they found alternatives?”

Drury said that the recent 20 percent reduction in occupational taxes was not due to good management, as some may have claimed, but on the backs of county employees who have not received a raise in past years.

In June, magistrates approved a reduction in county occupational taxes from one percent to 0.8 percent. This change is expected to reduce the county’s revenue from $442,540 in FY2010 to $400,000 this fiscal year because the reduced rate will not take effect until January 1, 2011. By the 2012 fiscal year, the county’s 0.8 percent occupational tax rate is expected to generate $350,000 – provided employment levels remain the same.

Judge Executive David Jenkins said that the problem with Drury’s proposal was that only people who own property would be paying for the tax increase. Meanwhile, approximately “80 percent of residents are paying occupational taxes elsewhere. By keeping this rate down, we’re helping our community more,” said Jenkins.

City and county officials also proposed to maintain the current levels for personal property taxes. The city commission expects to receive $13,900 with a rate of 25 cents per $100 of assessed value. Fiscal court’s rate of 12.3 cents should bring in $133,700 in revenue.

Taylorsville Commission unanimously passed a first reading of the proposed tax rates and will hold a public hearing August 26 at 5 p.m. in the city hall annex.

Spencer County Fiscal Court also unanimously approved a first reading of their proposed tax rates. A second reading will likely be placed on the August 16 agenda.

Real property taxes are on land, residences and improvements, while personal property taxes are applied to all property that can be filed on a tangible tax return document, such as business equipment.