Wilfred Volesky: 2009 legislative property tax relief
During the 2009 legislative session a $295 million property tax relief bill was passed. This property tax relief will be accomplished by providing money to school districts on a dollar-for-dollar basis to fund a reduction in the local mill levy. This amounts to a 15 percent to 18 percent reduction in property taxes for tax years 2010 and 2011. In addition Senate Bill 2199, which included the $295 million in property tax relief, sets aside another $295 million from the Permanent Oil Trust Fund to keep the property tax reduction in effect for the 2011 to 2013 biennium.
As a Mandan School District taxpayer you will receive the property tax relief in the following manner. The Mandan School District has normally levied 185 mills on the valuation of school district property for general fund purposes. This year the school district must levy 75 mills less or a maximum of 110 general fund mills. The school district will receive 110 mills from local property and will receive the remaining 75 mills from the state. In effect, as a taxpayer you will receive a reduction of 75 mills on the school district property taxes that you will pay during the upcoming tax season.
As a school district taxpayer you may wonder what the 75-mill reduction will mean to you. If you own a home that is valued at $150,000, your property tax relief will be $506.25. If you own a business that has a value of $150,000, your property tax relief will be $562.50.
The tax relief amount listed above will occur if there has been no change in the value of your home or business. So let’s assume that the value of your home increases by 6 percent. If that were to occur the value of your home would increase to $159,000. Your property tax relief will be based on the value of your home last year or $150,000. The problem is that the property tax that you will pay for the upcoming year will be based on the new value of your home, which is $159,000. This will result in a net increase of $44.55 in property taxes. Considering this increase, your property tax relief will end up being $461.70.
Based on the legislation passed during the 2009 session, it appears that you can expect to receive this property tax relief for the next four years. I’m confident this tax relief will be appreciated and useful to the property owners in our school district.