Home >> News >> Property tax rate to be set at zero

Property tax rate to be set at zero

On the face of it, it looks like good news – the St. Charles County property tax rate for 2015 will be set at zero. But looks can be a little deceiving, said one county council member.

The County Council gave a first reading to a bill adjusting the county’s property tax rate this year to basically nothing at its Oct. 13 meeting. Taxing jurisdictions have to set the rates that appear on year-end tax bills by October.

The county’s rate, which is separate from other taxing jurisdictions, was already low at sixteen hundredths (.16) of a cent for each $100,000 of assessed valuation.

Because the county’s sales tax has continued to grow, state statutes are requiring that the county now reduce its general fund property tax levy this year to zero cents per $100 assessed valuation.

“It’s as close to zero as we can get,” Bob Schnur, the county’s finance director, said of the 2015 tax rate.

Schnur told the council that the county was required to reduce its total property tax that goes into the county’s general fund annually by 50 percent of the total amount of county sales tax revenue collected in the same year. In 1979, county voters approved a half-cent sales tax.

He said the county’s sales tax revenue has increased by 20 percent since 2008, while its assessed valuation is still a negative 2.2 percent.

“We got back to pre-recession levels in sales tax revenue (in) 2011; we’ve yet to get back to pre-recession levels in assessed valuation even now,” Schnur said.

The county property tax generates only about $100,000 annually in revenue. But Councilman Joe Cronin (District 1) said he worried about the county becoming too reliant on sales tax revenue for its general fund, which includes most county government expenses.

“We’ve got our eggs pretty much all in one basket with sales tax,” Cronin said. “The Internet has changed the world as far as how people shop, and I’m concerned that  down the road that could not be healthy for county government.”

Schnur said state statutes allow property taxes to be increased to offset a drop in sales tax. But he and other county officials said there may be limitations on how quickly and how much rates could be adjusted. The county also may not be able to adjust sales tax rates on some items such as food. County officials agreed they may have to study the issue.

Print Friendly, PDF & Email
Share this:

Comments

comments

X