George

I have tried to explain the tax rate debate on Charlottesville Tomorrow's blog and your readers might benefit from that analysis:

Here is a post with my "user guide to the tax rate debate."

Those concerned about elected officials' statements and newspaper headlines trumpeting "tax decreases," would prefer to see the real estate tax issue presented clearly such that if the rate stays the same or only drops a little, it is made clear the tax burden is still increasing for the public. I think that's a fair critique. Of course, we can't control the headlines, but I can control my reporting of this issue. So, f or example, note in this post how I describe the City's proposed tax rate:

"City Manager Gary O'Connell is recommending to City Council a rate of $0.99 per $100 of assessed value, an effective increase of 11.5 cents... "

In this case, even though the rate is the same in the City, because of rising assessments, taxes are going up, and those there is an effective hike in the tax rate.

Some are suggesting the official tax rate suddenly drops automatically since the assessments were reported. More accurately I think, we should say local government has to advertise a "lowered tax rate" that would offset the assessment increases and that, unless they hold a public hearing to set a new rate (which they always do), it will become the lowered rate in the next fiscal year's budget. We also need to remind folks that the tax rate is based on the calendar year and not the fiscal year. If the rate in Albemarle County is raised or lowered in April, it will be retroactive to January 1st. That presents windfall or refund issues for local government budget staff to keep track of as the Board of Supervisors approves a balanced budget as required by law. The windfall was not identified as an issue in 2000 (last time Albemarle raised the tax rate) and it was a public relations mess for the Board.

Brian Wheeler (electronic mail, March 9, 2007)