Tuesday, September 27, 2011

Fairview Fire District Proposes 13.2 Percent Tax Rate Increase

The Fairview Fire District's proposed 2012 budget approved by Fairview's fire commissioners last evening calls for a true value tax rate of $5.79 per thousand dollars of market value, the highest in a decade.  Under this budget, property taxpayers will pay Fairview a greater portion of their wealth — as measured by the market value of their property — than at any time since 2001, when the tax rate was $6.07. 

Tax Rate Increase

Fairview's proposed tax rate increase is 13.2 percent, the highest tax rate increase in a decade, according to my analysis of the budget document from a taxpayer viewpoint.  The tax rate increase from a budget viewpoint is 14.6 percent.  The taxpayer viewpoint represents taxpayer experience, while the budget viewpoint represents the fire district government's experience.  For more details, see Tax Rate Viewpoints — Taxpayer Versus Budget.

It is a little-known fact that Fairview's true value tax rate has decreased for most years of this decade, as shown in the following chart:

Next year will be only the third year this decade that Fairview's tax rate has increased.

In my view, charts like the one above tell a much richer story about what has happened and what is happening with Fairview's taxes than I can tell in words.  If you agree, I strongly encourage you to view all six charts in my report Fairview Fire District Property Tax Data.  Detailed numerical data is also included.

Tax Levy

The proposed 2012 tax levy of about $2.9 million is the third highest in Fairview's history, exceeded only by the tax levies in 2008 and 2009.  The proposed tax levy increase is 9.3 percent, according to my analysis of the budget document from a taxpayer viewpoint.  The tax levy increase from a budget viewpoint is 10.7 percent. 

Market Value

Fairview's taxable market value for 2012 taxes has fallen for the forth straight year, reflecting the continuing real estate meltdown.  Fairview's taxable market value is now just under a half billion dollars, for the first time since 2006.  Fairview's taxable market value has dropped 15.3 percent since its high of $586 million in 2008, including 3.5 percent since last year.  The market value decreases in recent years have been a major factor in increasing Fairview's true value tax rates over what they would otherwise have been. 

Why did I write this post?

Why did I write this post describing Fairview's proposed tax rate increase and trends from previous years?  After all, anyone can just look at the proposed 2012 budget document itself and get the same information, right? ...  Right?

If you've tried this at home — or even at yesterday's budget workshop where the document was presented — you know the answer:  No, you can't.

Well, you can get a few of the numbers:  Fairview's proposed tax levy, and even the tax levy increase percent.  But the tax rate increase percent?  The document does contain a number for this, but the number is incorrect.  What about the tax rate itself?  And what about the market value of Fairview?  The document contains both correct numbers and incorrect numbers for each of these key parameters!  Can you tell which is which?  I couldn't, without out of band information.

So now you know why I wrote this post.  I'll have more to say about Fairview's proposed 2012 budget document in a subsequent post.

1 comment:

  1. Early last evening, an unsigned, undated, four-sentence “revision notice” was posted to the commissioners’ page of the Fairview Fire District website, announcing that, “The assessed valuation of the Town of Hyde Park used in the budget preparation was incorrect.” It turns out that Hyde Park’s assessed valuation was low-balled by about 2.2 percent. Correcting this mistake changes the market value and tax rate parameters in my post, but not by much. None of the charts in my accompanying report are materially affected.

    Since the Hyde Park portion is only about 28 percent of Fairview, Fairview’s market value was low-balled by about 0.6 percent. So Fairview’s market value for 2012 taxes is 2.9 percent below 2011, rather than 3.5 percent below. Similarly, Fairview’s proposed 2012 true value tax rate is $5.75 per thousand dollars of market value, rather than $5.79. This is a 12.6 percent increase over 2011, rather than a $13.2 percent increase. All these numbers are from my analysis. None of them appear in the revision notice.

    The revision noticed also announced, “The Fairview Fire District proposed budget for 2012 has been revised.” And sure enough, a one-page “Proposed Operating Budget (revised 9-28-11)” is now posted to the Commissioners’ page. This document is structured according to New York State Budget Classifications, and bears no relation to the format of the 8-page budget workshop document presented on September 26. This document contains Fairview’s proposed true value tax rate (if you know where to look), but none of the other parameters described above.

    I still plan to post again about the September 26 budget document, which was the basis for the commissioners’ decision to accept the proposed budget.


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