Sean C. Morgan
With tax bills in property owners’ hands, a boost in assessed values has increased revenue for the city and other taxing districts.
Linn County billed property owners $146 million in taxes this year on $9 billion in taxable property value.
The county has a total real market value of $12.1 billion, according to assessor’s office estimates. Taxes are imposed based on assessed value, $9 billion. Property tax assessments are limited to $10 per $1,000 when compared to real market value.
The City of Sweet Home has a total real market value of $511 million and an assessed value of $421 million, resulting in $2.7 million in revenue, the majority of which is used to fund the Sweet Home Police Department.
“We’re a little better off compared to what we were proposed and what we’re actually getting,” said city Finance Director Pat Gray.
The city budgeted police levy revenue at $1,526,000 and library levy at $186,000. With assessments complete, Gray now anticipates actual revenue of $1,621,000 in the police levy, a change of $95,489, and an actual revenue of $208,000 in the library levy, a difference of $22,000.
The difference is based on increases in valuation, assessed and real market.
The City of Sweet Home imposes a property tax of $8.64 per $1,000 of assessed value, the largest rate in the Sweet Home area. Sweet Home property owners have the highest combined tax rate in Linn County at $23.024 per $1,000 of assessed value.
Among the general government agencies are Linn County, $4.29 per $1,000; City of Sweet Home, $8.64; Sweet Home Cemetery District, 22 cents; Sweet Home Fire and Ambulance District, $1.86; and 4-H Extension Service, 7 cents. Based on assessed values, those rates are used to calculate tax bills.
Those rates don’t tell the whole story when it comes to tax revenue. Agencies, especially inside the Sweet Home city limits, will collect much less value than is reflected by those rates.
Property taxes are limited to a combined total of $10 per $1,000 of real market value. Anything more than $10 per $1,000 of real market value is not collected, with local option levy revenue reduced first. That amount is called “compression loss” by government officials. Local option levies, which must be renewed periodically, include the city police and library levies and the county’s law levy.
Area education taxes include the Linn-Benton-Lincoln Education Service District, with a rate of 30 cents per $1,000 of assessed value and the Sweet Home School District, $6.96. Education districts are limited to $5 per $1,000 of real market value. The Sweet Home School District has a local option levy it uses to fund the pool at the high school.
Outside of the property tax limitations but included in the total combined tax rate for Sweet Home, Linn-Benton Community College, the Sweet Home School District and the Sweet Home Fire and Ambulance District each have general obligation bond levies.
Generally, assessed values are limited to 3-percent growth annually, while the Linn County assessor’s office estimates real market values based on comparable sales in the area.
Compression losses for Sweet Home came in lower than expected, $19,000 in the police levy and $12,000 in the library levy, Gray said. It is the second year in a row that compression has decreased. Decreases in compression are tied to increasing real market values.
The assessed value of Sweet Home is at its highest level, $421.5 million, while real market value, $511.2 million, is approaching its record, $537.2 million in fiscal year 2008-09. Real market values began falling after that, dropping to $440.5 million in 2013-14, a decrease of 18 percent over five years.
As a result, “compression loss” increased from $216,500 in 2008-09 to a peak of $940,000 in 2014-15, leading to shortfalls funding the Police Department from the levy. The city has been transferring funds from the general fund in recent years to cover the cost of the service.
Around the city, the Sweet Home Fire and Ambulance District will collect some $1.4 million, about $55,000 more than anticipated, from a district worth $1 billion in real market value and $759 million in assessed value.
Sweet Home School District will collect $5.8 million from an area with a real market value of $1.2 billion and an assessed value of $886 million.
The Cemetery District will receive some $140,000.