Happily for homeowners, property values are still rising from their recession lows. Values rose in Ada and Canyon counties in 2014 for the third consecutive year after four straight years of decline.
That means your property tax bill is headed in the same direction.
“I would see taxes probably going up slightly, maybe 5 percent to 6 percent,” said Ada County Assessor Robert McQuade. “That is because we saw about a 6 to 7 percent increase in single-family residential properties. Levies, in general, are decreasing or flat. So when you have a 6 percent increase in values with effectively a flat levy, you would see property taxes going up pretty much what the increase in the value is.”
Two main factors determine a property tax bill: the value of the property, obviously, and the levy rates set by each taxing district that includes the property. A third factor, the homeowners exemption, applies to owner-occupied homes.
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All Idaho property owners will be receiving their 2015 property tax bills in about a month. Here’s what you need to know about how those bills are determined.
1. How are levy rates set?
By dividing the total amount of a taxing district’s budget to be funded by property tax by the total taxable value of all properties within the district. This rate, multiplied by the taxable value of the property, determines the amount of taxes owed on the property to the district.
State law allows taxing districts to increase their property tax budgets by up to 3 percent a year, plus the property taxes collected on the value of new construction. If values rise, the districts can boost their budgets without raising levy rates.
Each property falls within several independent taxing districts:
• Ada County has 39 districts, including the county, cities, schools and the highway district, as well as smaller ambulance, fire, library, cemetery, mosquito abatement, irrigation and community infrastructure districts. Your property tax bill include taxes for all the districts you’re in.
The 2015 levy rates remained the same or fell in all but four of Ada’s taxing districts — Ada County itself, the Ada Library District, Eagle and the West Ada School District.
• Canyon County, which has more cities, school and highway districts than Ada, has 60 taxing districts. The 2015 levy rates stayed the same or decreased in all but 10 of the taxing districts. The 10 where rates rose include Canyon County, Melba, Middleton fire and the Marsing, Nampa and Notus school districts.
2. How much are assessed values rising, and where?
Each May, county assessors issue new assessments for land and improvements effective Jan. 1 of that year.
This year, Ada County residential assessments increased an average of 6.8 percent. Homes in Southeast Boise, the Bench and Garden City saw 10 percent to 13 percent increases.
This year’s median home assessment is $189,700, nearly the same as 2009. The median peaked in 2008 at $211,600 and plummeted to $137,900 in 2012.
Canyon County increases this year ranged from 4 percent in Caldwell to 6 percent in Nampa and 10 percent in Greenleaf.
3. Will the homeowners exemption offset the additional taxes districts are collecting?
This exemption allows half the assessed value of an owner-occupied home and up to one acre of land to be exempted from taxation, up to a maximum amount.
This year’s maximum amount is $89,580. Last year’s was $83,920. Next year’s will be $94,745. The exemption peaked in 2009 at $104,471.
Since 1980, the exemption has been the Legislature’s way of offering Idahoans property tax relief. In 2006, the state changed the law to tie the amount to a federal housing price index for Idaho. The exemption is the same throughout the state.
The rise in a property’s value likely will offset any decrease resulting from the exemption, McQuade said.
Two residential developments where property tax bills will be higher than in nearby neighborhoods are Harris Ranch and Avimor, where the costs of a new improvement district will add to what homeowners owe.
4. So what’s happening in Harris Ranch and Avimor?
Harris Ranch, in East Boise, and Avimor, northeast of Eagle, have separate taxing districts called a community infrastructure district. Property owners within such a district’s boundaries pay an additional tax specifically for improvements such as parks, pathways and other amenities.
Clarification: Not all homes in Harris Ranch are located within the Harris Ranch Community Infrastructure District
This year, in addition to Boise city taxes of $734.94 per $100,000 of a home’s taxable value, owners within the Harris Ranch community infrastructure district will pay $292.92 per $100,000. Avimor district homeowners will pay an additional $257.51 per $100,000, though they do not have to pay any city taxes because Avimor is not within any city limits.
Harris Ranch began its special levy in 2011. This is the first year for Avimor’s.
The Spring Valley planned community north of Eagle also has a community infrastructure district, but it did not levy any taxes this year.
5. Why does Caldwell have the highest property tax rate in the Treasure Valley and Eagle the lowest?
When the property within a city is of higher value, “you do not need a real big levy to support the city’s budget,” McQuade said. “When you go into areas with less value, you have to have a higher levy to support it.”
Eagle has the highest property value and the lowest levy rate of any city in Ada or Canyon counties. Its median home value is $329,300. If you own that home, you’ll pay the city $244. (The math: $329,300 minus the maximum $89,580 homeowners exemption = $239,720, multiplied by the levy rate of 0.001017890 = $244.)
Caldwell has the highest levy rate in either county; its median home value is only $117,600. If you own that home, you’ll pay the city $628.67. (The math: $117,600 minus the 50 percent homeowners exemption of $58,800 = $58,800, multiplied by the levy rate of 0.010691746 = $628.67.)
6. When will I receive my tax bill?
County treasurers will mail them around Nov. 20. The first half of the 2015 property tax bill is due Dec. 20. The second half is due June 20, 2016. For homeowners who pay into an escrow account with their monthly mortgage payments, the company that holds the mortgage will pay the bill.
7. What if I want to challenge my bill?
There is not much you can do right now. If you have a problem with the assessed value of your home, take it up with the county assessor’s office after your next assessment comes in late May. If you think a taxing district is collecting too much, take it up with that district’s elected officials to influence their future spending decisions.