Reader Asks Questions About Their 2021 Property Tax Bill
In an effort to assist our readers from time to time they send us questions they want answered and we ask the questions for them.
The question this time has to deal with a resident’s anticipated 2021 property tax. The question was:
“Notice of assessments are much lower this year on house properties yet the housing market is red hot. I contacted the city regarding my house is now $34,500 less on the notice of assessment. Would this result in tax reduction on the property, they have no answers.”
We put the question to city manager Jim Puffalt at the regular post Council meeting media scrum.
Puffalt said that Moose Jaw’s property taxes are set based upon property class with each class responsible for generating a set amount of revenue. A reduction in a residential property assessment value may not necessarily mean a reduction in your property tax bill.
He provided what he described as “a rough” description of what a decrease in a residential assessment would mean for homeowners. What he described was based upon a percentage baseline of a reduction of assessed value of ten percent for single family dwellings.
“Overall there was a decrease of ten percent of residential property values,” Puffalt said adding if your home’s assessed value decreased ten percent your taxes would likely remain the same plus whatever tax increase Council finally sets for the residential property class.
“At more than ten percent (decrease in assessed value) you would likely see a small decrease in property taxes,” Puffalt said.
Graphic Illustrating the most likely property tax bill based upon re-assessment and a 10 percent assessment drop baseline - MJ Independent graphic
Asked about what the decrease would mean, for those whose homes were reassessed as dropping more than ten percent in assessed value, in way of a potential property tax reduction the city manager said he could not as Council had not yet set the mill rate and the mill rate factors which ultimately will determine the final City property tax bill.
Mill rate factors are special tax tools the City can use to tweak property tax rates for property classes. The City has been using it for instance since 2018 to decrease the tax difference between what commercial property taxpayers pay versus residential property taxpayers in what is called “tax fairness” to level the playing field in property taxes - based upon equally assessed values- between commercial and residential.
For those who are unaware 2021 is a re-assessment year. In a re-assessment year the Saskatchewan Assessment Management Agency or SAMA goes throughout the City and then sets a value for all properties. Re-assessment years are every four years.
During its re-assessment SAMA uses what some of their critics claim to be “a witches brew” of factors (for residential it is things such as home improvements, selling prices of similar homes and other factors such as potential rental income) to establish the value of all properties in the City - including those which are property tax exempt like churches.
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