Q&A of the Day – How Much the Proposed Palm Beach County Mileage Rate Reduction May Save You
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Today’s Entry: Hey Brian- It was great to hear the county commission is finally starting to do something conservative. I’ve been waiting for the republicans to step up and to do what they should be doing. How much would the rate decrease on property taxes save? Thanks.
Bottom Line: Today’s question comes on the back of the news that the Palm Beach County Commission is considering a significant milage rate decrease amid record windfall revenues into the county and the recent estimates from the Palm Beach County property appraiser indicating maximum property tax assessments will be felt by almost all property owners in the county for the second consecutive year. Specifically, Commissioner Maria Sachs, has said the County Commission has had a preliminary conversation about a 4.6% reduction in the county’s milage rate. While no records of this are currently reflected on the County Commission’s website, the word is the topic will be taken up in a July meeting which should be reflected in an upcoming agenda. The county commission is only scheduled to meet once in July, on the 11th, so given current guidance that should be the meeting where this officially hits the commission’s agenda. Before diving into how much might be saved let’s revisit how much more we’re currently on pace to be spending.
Based on the initial assessments by the property appraiser’s office, the average increase in taxable property value in Palm Beach County will be 13% based on last year’s rates of property appreciation in the county. That means homesteaded property owners can likely expect to see a 3% increase in property taxes this year, with non-homesteaded property owners once again facing the state annual maximum increase of 10%. The range across the county is an average increased assessment of 7.5% in Rivera Beach on the low end to a 37.7% increase in Cloud Lake.
The average property tax bill in the Palm Beaches this year was $2,679, which is already the second highest in the state. That means the average property tax bill will rise, unless local governments reduce mileage rates, by $80 for homesteaded properties to $268 for non-homesteaded properties. Importantly, in the context of understanding the how much a milage reduction at the county level would mean to you, it’s important to note that the “County Operating” and “County Debt” assessments are commonly the third or fourth highest assessments for Palm Beach County property owners. The “Palm Beach County School District By State Law” is the top property tax assessment, followed by the “Palm Beach County School District By Local Board”, then municipal assessments for those who own property in incorporated communities. While a reduction in milage rates at the county level is welcomed and, in my opinion, the right thing to do given the record revenues the county will continue to reap even if they apply the discount – without similar action taken by other taxing authorities, property tax bills will still rise and often considerably.
What the County decrease, if passed as rhetorically proposed at 4.6%, would mean to you (based on my calculations) is a reduction in the increase in property tax burden of approximately $21.40 per $100,000 in taxable value. That means the average property owner would pay approximately $85 less in property taxes than they would without the milage reduction. As I said in in late May after news of the initial assessments came in...
With another round of record revenue on the way to local governments, responsible leaders at the county and municipal levels should be looking at reducing mileage rates. As I covered in a Q&A just over a month ago, the five-year average annual increase in spending by governments in Palm Beach County has been 8.4%, including two consecutive years of double-digit growth in spending. Totals that are greater than double the rate of income growth by residents of Palm Beach County. At some point that math stops working. So as much as we love living here, we need to do our part to see to it that we’re not taxed out of here as max property tax assessments are on the way again for most in Palm Beach County but that doesn’t mean there has to be max taxation imposed by local governments again. That’s a choice and it’s one we should hold our locally elected officials accountable for making. Now’s the time to start having those conversations. So, kudos to the County Commission for taking a big first step. Now it’s time for other taxing authorities, starting with municipal governments, to do the same.