Despite County’s Spike, Most Flagler and City Homeowners’ Tax Bills Will Fall in 2013
FlaglerLive | September 7, 2012
It’s been a familiar and recurring complaint, but also an inaccurate one: that property taxes keep going up. They don’t. For most people, property taxes fell this year. And for most people, property taxes will either stay flat or fall again in 2013. The minority who see an increase in their taxes should be thankful: they’ll only do so if their property values have appreciated.
This past week, the Flagler County School Board, the Flagler County Commission, Palm Coast and Flagler Beach all held the first of two required public hearings to set next year’s property tax rates. The Bunnell City Commission did so last month. With Flagler County’s exception, every one of those governments is either keeping its tax-revenue collection flat or lowering it, in some cases substantially.
The tax rate is not falling, except for the school board’s. In most cases, the rate is increasing. But since most people saw their property devalued again, the rising tax rates are designed only to compensate for that lost value, as various governments choose to stick with the so-called roll-back rate–the rate at which a government generates the same amount of revenue in one budget year as it did the previous year. That’s the case with Palm Coast and Flagler Beach. Their tax rates are increasing some. But Palm Coast saw its property values decline on average another 6.38 percent, and Flagler Beach saw an average decline of 5.54 percent. Their tax rates are rising roughly by those same amounts.
Bunnell is keeping the same tax rate it had this year, which, combined with the largest average property value drops in the county 6.9 percent) will translate into substantial tax savings for Bunnell residents. The typical, $150,000 house with a $50,000 homestead exemption there will realize a saving of around $167 (although in Bunnell, the poorest city in the county, homes typically aren’t valued at $150,000).
Only Flagler County is raising its property tax rate beyond the roll-back rate–well beyond it: property values dropped 6.2 percent countywide. The county, however, is raising its tax rate 14 percent (even more than the 12 percent it had projected in early July) as county commissioners find it necessary to generate more revenue to plug large deficits that opened this year, because of accounting issues and other costs. (See details about the county’s issues.) That’s in spite of the commission’s decision to renew a half-cent sales tax levy (but without seeking taxpayers’ permission at the ballot box) and use that revenue to build a jail expansion.
The county’s tax rate increase amounts to no more than $20 for that theoretical $150,000 house, and when the tax increase is combined with all other taxes on a homeowner’s bill, the final cost is still lower: for a $150,000 house, a homeowner in the unincorporated area of the county would see, on average, a $74 decline. Palm Coast residents would see a $92 decrease. Flagler Beach residents would see a $76 decrease. Bunnell residents would see a $167 decrease.
Keep in mind: those are average calculations. Some residents in various pockets of the county and in parts of those cities have seen their property values improve. They will see a net increase in their tax bills. But they will be the minority.
The biggest help in keeping tax bills down is the school board, though the locals school board didn’t get to set those tax rates. That’s done in Tallahassee. But for the second year in a row, school taxes are going down. School taxes account for the largest share of most homeowners’ bills, and only a $25,000 exemption applies, rather than the full $50,000. Still, lower school taxes are a mixed blessing: There’s a direct connection between Florida’s lousy schools and its low property taxes, which still rank among the lowest in the country.
The chart below outlines what homeowners were paying this year and what they’ll pay next year, based on currently proposed tax rates by each local government, and on the median-priced $150,000 house referred to throughout. The governments are unlikely to change their tax rates at this point.
The chart includes the tax rates of other agencies or obligations, such as the St. Johns River Water Management District, mosquito control, voter-approved levies to protect sensitive lands, and the county’s debt obligations. All residents, no matter where they live in the county, pay all those taxes. The chart does not include the Florida Inland Navigation District tax, which amounts to only a few dollars on most bills.
Property Tax Rates and Effective Tax Bills for Residents in Flagler County, Palm Coast, Flagler Beach and Bunnell, on a $150,000 House with a $50,000 Homestead Exemption.
|Flagler County School Board|
|County Debt and Sensitive Land Levies|
|St. Johns River Water Management District|
|Total: What All County Residents Pay|
|Palm Coast Residents|
|Flagler Beach Residents|
(*) The 2012 tax rates have been approved in each local government's first of two budget hearings. It is unlikely that the rates will change before approval at second hearing.
(**) For a definition of the roll-back rate, go here.
(***) The tax bill is calculated on a median-priced house, which in 2012 was around $150,000, with the assumption that the house has a $50,000 homestead exemption. So its taxable value would be $100,000 in 2012, but its taxable value in this chart takes into account the devaluation it would have experienced, according to property appraiser. That house, for example, would have lost 5.5 percent of its value in 2012 if it were in Flagler Beach, so its taxable value for 2013 tax bills would be $91,690.