Macon’s current tax rate lowest in the state at 27.9.
After much debate in 2011, Macon County followed a state-wide trend to delay the 2013 tax revaluation until 2015. Citing a crippling housing market due to the recession, leaders across North Carolina hoped that by delaying the revaluation, time would allow the market to bounce back to improve numbers.
At the time, Richard Lightner, longtime tax assessor for Macon County, explained that due to the recession, the housing market was essentially nonexistent, and with the lack of properties changing hands, there was not enough activity to establish meaningful property values. Lightner also explained that with values being adversely affected due to the market, it would be nearly impossible for his office to establish accurate values that would be adequately defended legally in the event a property owner sought an appeal.
By law, revaluations in North Carolina must take place at least every eight years, but can occur more often if a county sees fit. Historically, Macon County has focused revaluations on a four-year cycle. With Macon County’s last revaluation completed in in 2007, the county is operating under the assumption that property values reflect those of 2006, before the market began to decrease drastically.
While the housing market is far from fully recovered, more homes are being sold and the movement will allow more accurate assessments, explained Lightner during the Macon County Board of Commissioner’s board retreat last month. Lightner explained that with the recent pick up in home sales, paired with the current economy, the revaluation is expected to place home values closer to values depicted in 2003. With an estimated 25 percent decline in property value since the last revaluation, Lightner explained that 2007 values will not be realized again for another five to 10 years at best.
The county can no longer delay the revaluation, leading Lightner to present board members with a timeline for how the process will be implemented in the coming months.
While overall, home values have declined by around 25 percent, Lightner informed commissioners that vacant land values have declined the most with a 50 percent or more decrease. The revaluation is expected to reflect a total taxable value decrease of $2,000,000.
In order for the county to see a considerable growth in the tax base, the focus needs to be aimed toward commercial development and residential recovery, explained Lightner.
Lightner projected that if the county can expect to see all revenue and expenditures to stay as they are in the current budget year (2013-14), the revenue neutral tax rate for the county would be around 38 cents per $100. That is around a 10 cent increase from the county’s current tax rate of 27.9 cents. Macon County’s current tax rate is the lowest in the state, with Jackson County coming next at 28 cents.
Different variables associated with properties in the county would impact the change in property tax. Lightner explained that due to these variations, about one-third of the property in the county can expect to see an increase, one-third would see a decrease, and one-third would remained unchanged.
While property values falling in the medium price range are anticipated to remain the same, the revaluation would cause these home owners to pay a higher tax on the property.
For cost saving measures, and because Macon County has the experienced personnel needed to complete the revaluation, the process is being conducted in house. Compared to other counties across the state, this process will save taxpayers a considerable amount of money. “The county is choosing to do its revaluation utilizing in house personnel,” said County Commission Chairman Kevin Corbin. “According to Richard Lightner, that will save the county over a million dollars as opposed to hiring an outside agency to complete the task. We have full faith in Richard and our county personnel that they can do a great job with this. Our goal at the beginning and throughout the process is to wind up with a revenue neutral tax rate and balanced budget in the end. I think all involved in the process agree that the revaluation needs to be fair to all taxpayers.”
Property tax rates need to produce about $25 million annually in order for the county to remain revenue neutral. Lightner explained to commissioners that one measure needed to be taken to ensure tax rates stay as low as possible is to focus on the collection of delinquent taxes. He explained that if the county shows a collection rate of 97 percent, 3 percent in delinquent taxes need to be factored in which will result in a forced increase in the tax rate to make up the difference.
Macon County currently reflects $3,068,938 in delinquent taxes for the 2013 tax year. Between 2004-2012, Lightner explained there is an outstanding delinquent tax burden for the county of $2,631,705. By state law, the county cannot seek to collect taxes which have been delinquent for more than 10 years. Without a forced collection of those dollars soon, the county will lose that revenue altogether and be forced to increase taxes to account for the difference.