Happy New Year Monroe! January is typically the month when tax bills arrive. I got mine just last week. So, I thought I would take advantage of this month’s article to explain a little bit about how to read your tax bill.

The first thing to look at is the appraised value. You should see an appraised land value and a building value for a total appraised value. This is not the amount that you are taxed on. Taxes are charged on the assessed value which is equal to 35% of the appraised value. So if you house is appraised for $100,000 then you pay taxes on $35,000.

Now, this is a good time to discuss homestead exemption for seniors. Homeowners who are age 65 or age 59 and disabled are eligible to apply for homestead exemption. For those who qualify, the exemption takes $25,000 off the appraised value of the home before determining the assessed value. So if that $100,000 home is owned by a qualifying senior, then the appraised value is $75,000 and the assessed value (35% of $75,000) is $26,250 – taking almost $10,000 off the taxable value of their home. This year’s filing deadline for homeowners will be June 2, 2008.

Now that you have an assessed value of your home, then taxes can be determined. For this you need to know the millage rate. This figure is located on the left hand side of your tax bill. Most Monroe School District residents will pay 58.8 mills. So to find your total tax due, you would multiply your assessed value times your millage rate.  One mill is equal to one-tenth of a cent ($0.001). If we go back to our original example, the assessed value of the home is $35,000. Multiply this times 0.0588 and we get $2,058.00 as annual taxes due. 

In the middle of your bill, you can see exactly what entities are included in the tax determination. Some of the organizations listed on my tax duplicate (I live in Monroe) are the Mental Retardation Board, Miami Conservancy, Mental Health, Children’s Services, Senior Citizens, the City of Monroe, Lemon Township, Butler Tech, and the Monroe Local School District. Each of these entities had to have had an issue voted on and passed by the citizens of Monroe to be able to collect taxes.

However this is not all to understanding the tax bill. There is also something called a 10% rollback and a 2.5% rollback. These rollbacks were instituted in 1972 and 1979 respectively to help homeowners offset the impact of property taxes. So, we need to deduct this from our tax due - $2,058 x 10% = $206; $2,058 x 2.5% = $51.45. Our new tax due is $1,800.45 annually (2058-206-51.45 = 1800.45). Tax bills are sent out twice a year with one-half being due each time.

Now that you have an understanding of how tax bills are calculated, then you can start to see exactly how any upcoming ballot issues might affect you personally. The upcoming bond issue for a new K-4 building will be a voted 6.55 mills with a 2 mill reduction in 2010. So for our $100,000 home in Monroe, this bond will cost the homeowner about $229.25 annually at first. Then in 2010 when the already planned millage drop is enacted, the annual amount will drop to about $159.25 a year. This is a little over $13 each month.

The Monroe School District’s original Master Plan determined that a new elementary school would need to be opened by 2010 to house the expected growth by resident students. The original bond levy for the existing building was structured to allow for this and included a 2 mill drop in 2010. The original plan was to be able to refinance the bonds so that a new school could be built without any additional cost to homeowners. Unfortunately with construction costs having risen so much in the past few years, a bond issue is the only way to raise the funds to build this planned expansion of the Monroe campus. The great thing is that the planned millage drop will enable the district to finance a much needed school at a fraction of the cost to homeowners. Let’s Continue Building the Vision!

As always, please contact me if you have questions. My email address is kthorpe@monroelocalschools.com or you can call me at 539-2536. Go Hornets!