The recent reappraisal of Licking County properties left some owners in shock and wondering how high their tax bills might go.
The short answer from Licking County Auditor Michael L. Smith is that the bills won’t go as high as some property owners might think.
“A fair thing to say is that, regardless of the increase in valuation, the tax bill increase won’t be one-for-one,” Smith said.
In this year’s revaluation, the average increase in residential property values in Licking County since 2020 is 40%.
Property values are reassessed every three years. A letter sent by Smith’s office in late August told owners that the latest reappraisal, required by the state, is based on recent sales and reflects the 2023 market value.
Smith wrote in the letter that “despite potentially historic increases in property values, property taxes will not increase or decrease by the same percentage as property value.”
Smith told The Reporting Project he understands that “it’s hard to think that it’s not going up,” but even in some cases in which property values went up, it’s possible that some owners will see their taxes stay virtually unchanged or decrease.
He said he even heard from his mother after his letter went out at the end of August. “My 87-year-old mother calls and says, ‘I got your letter!’ She said, ‘It doubled!’”
“We did the math, and no, it didn’t double,” Smith said, but he understands the concern and said again that the message is that “it’s not one-for-one” in terms of percentage increase in market value and tax bills.
The average increase in appraised market value for commercial real estate is 32%, and the average increase for industrial property is 48%, Smith said.
He said his office can’t calculate tax bills now for a couple of reasons: Any levy approved by voters in the Nov. 7 election would affect the tax bills in that jurisdiction, and his office won’t receive the state-calculated effective tax rates for the county until late this year.
He noted that any tax approved in November is generally retroactive and collected for the entire year, unless the ballot language says otherwise. So a new tax approved on Nov. 7 will be collected for all of 2023.
Smith said some residents have asked whether the sale of 1,000 acres of farmland in western Licking County for construction by Intel of the world’s largest computer-chip manufacturing campus was a factor in the increase in property values. He said it was not a factor in this reappraisal, but that the presence of Intel and the rising demand for housing could affect property values in the future – in Licking County and beyond.
“We asked property owners to call us if they want to come in for an informal meeting to discuss the reappraisal,” Smith said in late September. “We’ve had 150 people say they want to come in and see us.”
Given that there are 85,000 parcels in the county, he said, “I tell my staff that’s an A.”
If owners believe their property appraisal is incorrect and want to challenge it, they have that right, Smith said. “We want to help people,” he said. “If they deserve a reduction, they’ll get it.”
Property taxes support schools, fire and safety services, parks, cemeteries, and such programs as those for recreation, mental health, children services, senior citizens, and local governments.
Smith said that school districts receive the largest share of property tax revenue, and it also is the single largest source of funding for most districts, which also receive some money from the state, and some also collect voter-approved income taxes.
“Our largest source of revenue is property tax, so we’re dependent on property tax for the majority of our funding,” said Granville School District Treasurer Brittany Treolo.
Treolo said that a 0.75% income tax renewal approved by voters in May, along with property taxes and some other funds, are expected to sustain the district without the need for additional levy requests for the next five years. The income tax provides about 20% of the district’s total budget.
“Through the five-year forecast period, we are not anticipating the need for a new levy,” Treolo said, and she hopes that anxiety about property taxes will be reduced when bills are calculated.
“We passed the income tax levy (in 2023) for another five years; that has shown to be successful,” Treolo said. “We’ve seen that grow even during the pandemic when some other districts struggled. It’s been a successful model that we’ve used. It’s now 20% of our revenue. To lose that would be challenging, and it would have to be replaced with some other funding source.”
Some homeowners have expressed concern that the schools will receive a windfall in funding because an increase in property values will result in higher tax bills for some owners, but Treolo said this is not the case.
She said the effective tax rate is adjusted so that the district collects the total annual amount voters approved.
Noah Fishman and Alan Miller write for TheReportingProject.org, the nonprofit news organization of the Denison University Journalism Program, which is funded in part by the Mellon Foundation.