Property Taxes

When looking at the budget of a local government citizens focus on property taxes. But property taxes only represent a small portion of the overall picture. For the Fiscal Year 2009 budget of the Pasco County Board of County Commissioners the property taxes represent 16.5 percent of our total revenues. Property taxes are calculated by multiplying your home’s taxable value by your millage rate. It might help taxpayers to understand more about how the taxable value and millage are actually determined. In this discussion I will focus on a residential, homesteaded property.

Here is my sweeping generalization for this article: if you have been in the same homestead property since 1995 and have made no additions (swimming pool, additional bedroom, new enclosed deck) the county portion of your property taxes are lower for 2008 than they were in 1995 and significantly lower than in 2003. This is true even though your market value had increased in prior years. This is due to in large part to the Board of County Commissioners reducing or maintaining the general fund millage for the last eight years and the municipal fire millage for the last six years.

The taxable value of all properties is determined each year as of Jan. 1 based on Florida Statutes. The millage rates are set by each of the local governments. In Pasco County those governments are the County Commission, the School Board, the Mosquito Control District, the Southwest Florida Water Management District (SWFWMD) and their basin boards, and our six municipalities. For the vast majority of properties in the unincorporated portion of Pasco County the millage rate for this fiscal year is 14.4348 for every $1,000 of taxable value. That millage rate is broken down as follows:

School Board		7.2080
Southwest Florida Water Management District		.3866
Southwest Florida Water Management District basin board		.2547
Mosquito Control		.1567
Pasco County General Fund		5.4333
Pasco County Municipal Fire Service		.9955
		14.4348

Taxable value can be determined as follows:

Market Value minus Save Our Homes Exemption equals Assessed Value;

Assessed Value minus Exemptions equals Taxable Value.

The Save Our Homes exemption was first applied to homesteads in 1995. It limited the increase in assessed value to the lesser of 3 percent or the cost of living. The increase over the fifteen years has averaged 2.31 percent with the current year's rate being the lowest ever at one tenth of one percent. When a property is sold the assessed value is reset to equal the new market value. In the past this has led to homes having the same market value having widely different assessed values based on the length of time the property has been in Save Our Homes.

Until this year it was fairly easy to calculate most taxable values on homesteaded properties provided your home's assessed value was greater than $25,000. The formula was Assessed Value minus $25,000 equaled Taxable Value. With the implementation of Amendment 1 you now have two Taxable Values. One for school property taxes determined as before based on the original $25,000 exemption. The second taxable value applies to all other millages from local governments. Amendment 1 provides a second $25,000 exemption for homesteads for that portion of the value between $50,000 and $75,000.

Now a real world demonstration. I recently was asked to respond to a citizen email with questions concerning increases to their property taxes. The market value was $248,794 minus a Save Our Homes exemption of $139,622 equals an assessed value of $109,172. Assessed value minus $25,000 gives you a school taxable value of $83,672. Subtract the additional homestead exemption of $25,000 and the taxable value for all other governments is $58,672. So the 2008 taxes are school board $602.34, SWFWMD $37.56, mosquito control $9.18, and county $376.49 for a total of $1,025.55. The same property in 2004 had a total property tax bill of $1260.37. So a combination of lower millage rates by all of the governments and the additional $25,000 homestead exemption on all taxes except schools resulted in an 18.6 percent reduction in four years.

Our next article will discuss what services are paid for with property taxes. Please email your questions or comments to budget101@pascocountyfl.net .

Additional information on the county budget may be found on the Pasco County website at http://tinyurl.com/budget101.