As reported in the Courier on January 12, many property assessments in Fort St. James have increased significantly for 2011. BC Assessment reported an average increase of 15 to 20 per cent.
The Council of the District of Fort St. James understands the concern that some citizens have expressed about the property tax implications of this increase.
While property assessments provided by BC Assessment are used to calculate property tax, increases to one, are not necessarily reflected in the other.
Municipal property taxes are calculated by multiplying the assessed value of the property by the appropriate rate to arrive at the dollar value.
The appropriate rate in this calculation is reverse calculated using the required tax dollars. As a result, an increase in property assessment will usually result in a decrease in the rate used to arrive at tax dollar amount approximate to the previous year.
Council and District management are currently preparing the operating budget for the 2011 year.
This budget has a goal of increasing the operating budget by approximately 2.5%, and therefore a tax dollar increase of 2.5%. This increase is intended to keep up with the rising costs of labour and materials used in maintaining the current level of service within the municipality.
If your residential property was valued at $100,000 in 2010, the District collected approximately $875.
With a 20% increase in assessed value in 2011, the same house is now assessed at $120,000.
The District will adjust the mill rate downwards in order to collect the amount needed for this year.
Assuming a 2.5% increase, the amount the District will collect should only increase by a similar percentage. So the home now valued at $120,000 will have municipal taxes of about $897.
There are, of course, variations in the assessments. Owners with higher than average increases in assessments will end up paying more property tax, while those with lower than average increases (or decreases) will pay less property tax.
But the average property owner will not see dramatic change in property tax this year.
Please note that the Municipal Property Tax we have discussed above is only one component of a property tax notice.
Other items include: RCMP, Regional District of Bulkley Nechako, BC Assessment, Provincial School and Regional Hospital.
Questions regarding these other items should be directed to the appropriate taxing body. Questions regarding your assessment should be directed to BC Assessment.
For more information please contact the District of Fort St. James finance department: