Three of DeKalb’s four municipalities may soon be paying their share of the cost of property reappraisals, an expense that the county could have charged for 28 years.
Although DeKalb County has never enforced it, a state law was passed in 1989 requiring municipalities that collect a city property tax to share in the county’s costs of real property reappraisals and audits of personal property, unless an agreement is reached to waive the charge.
Assessor of Property Shannon Cantrell recently learned of the state law during a meeting of assessors and made County Mayor Tim Stribling aware of it. Cantrell also shared what he learned with members of the county budget committee, the city mayors, and the entire county commission at Stribling’s request.
It appears the county may now be prepared to require the cities to pay. The county commission discussed the issue but took no action during Monday night’s monthly meeting (May 22). However the county budget committee has recommended that projected revenue to be derived from the cities share be included in the 2017-18 budget which will be up for passage by the county commission later this summer.
“I was in a workshop at an assessors meeting in Cookeville when this subject came up. A question came up as to how many counties were doing it (charging cities). Several hands went up that were (doing it) and several hands didn’t go up. There were several new assessors there like myself. I didn’t have the answer. I didn’t know if we were doing it or not. Through the process of talking to the assessors and others, I was told it was my responsibility to gather this information and to present it to the county financial officer for the county. In our case it is our county mayor’s office. That is what I did. I gathered this information and presented it to Tim (Stribling). He wanted me to talk to the budget committee, which I did. I tried to explain it to them and then I met with the city mayors and tried to explain it to them. I did it as a favor to Tim to explain it the best I could,” Cantrell said in addressing the county commission Thursday night in an all-committees meeting.
“The law has been on the books for a lot of years. I guess its been lost through the cracks and wasn’t recognized that we should be doing it. This law was put in place because of the things the assessor’s office does that the cities are not having to such as the appeal work, the reviewing process, the adding of new construction, the taking away of blown down barns, burned houses, etc.,” the Assessor said. “All of that burden is on the assessor’s office. This law helps in having the cities pay a portion of that cost.”
Under state law, local costs of reappraisal of real properties within a city shall be paid one half by the county and one half by the city, unless there is an agreement between the city and county to waive the fees. Any city paying one half of local costs of reappraisal shall pay those costs directly to the county government with jurisdiction over the property being reappraised and shall pay those costs during the fiscal year in which the reappraisal is finalized. The cities of Smithville, Alexandria, and Liberty would be affected since they collect city property taxes. Dowelltown does not have a city property tax rate and would not be affected.
State law also requires cities to be responsible for sharing in the county’s costs of contracted personal property audits.
“We have a contract with Tax Management through the assessor’s office to do our audits. It is state mandated that you audit a certain percentage of personal property or businesses per year,” Cantrell said. “We don’t have the staff or experience to go in an audit Walker (Manufacturing) for example. We have to hire somebody to do that. That is common practice. We contracted with them in 2016 for $6400 to do our audits that have to be done. It’s the law that the cities pay a percentage of the audit costs and it is collected yearly.”
Based on 2016 numbers, Smithville’s portion would be $14,718 for real property parcels and $1,514 for its share of personal property auditing. Liberty’s costs would be $1,295 ( real property parcels) and $6.00 (personal property auditing). Alexandria’s share would be $2,814 (real property parcels) and $20.00 (personal property auditing).
“It looks like a big number for the City of Smithville and it is a big number but there is no way you (city) could hire an employee to go out and do the reviews, pick up new construction, personal property, the appeals, and all those things that go along with it for that money ($16,232). If you look at it from that perspective it’s a bargain,” said Cantrell.
According to Cantrell, the state has a formula the county must follow for calculating the cities’ share of real property reappraisals.
“Its pretty simple. You take the assessor’s budget and subtract what you pay out in audits ($6,400 for 2016) which leaves you with $199,565. Divide that number by the amount of real parcels for the entire county (18,682). That gives you $10.69 per parcel. Divide that in half and it comes to $5.35 per parcel for which the cities are responsible. The cities become accountable for their parcel count multiplied by the $5.35,” said Cantrell.
The cities’ reappraisal costs sharing based on 2016 numbers are as follows:
•City of Smithville: 2,751 Real Property Parcels multiplied by $5.35 per parcel equals $14,718
•City of Liberty: 242 Real Property Parcels multiplied by $5.35 per parcel equals $1,295
•City of Alexandria: 526 Real Property Parcels multiplied by $5.35 per parcel equals $2,814
Under state law, cities have the option of paying the real property reappraisal costs on a yearly basis or in a lump sum in the fifth year of the reappraisal cycle. “We’re on a five year cycle and the fifth year is when we finalize. Most people think reappraisal happens once every five years but the reality of it is we are in reappraisal the entirety of the five years. We just finalize it in the fifth year,” Cantrell continued.
Archived News & Obituaries