Property owners want answers concerning Riley’s tax plan
Published 12:00 am Monday, July 28, 2003
Bo McAlpine stressed he was not taking sides on the upcoming vote on Gov. Bob Riley’s tax plan, but Demopolis Rotarians knew exactly where the Marengo County tax assessor stood by the time he finished his talk Wednesday.
McAlpine and other county assessors met with Bill Bass of the Alabama Department of Revenue Ad Valorem Tax division last week to find out exactly what the tax package will mean to property owners.
His office is getting many phone calls and visits every day from people who want to know what impact the proposed amendment would have, and McAlpine said none of the assessors had a clue as to what to answer. So several of them got together to speak with Bass.
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In turn, Bass said any questions he can’t answer he refers to the Finance Department.
Current use values will be increased by 22 percent, phased in over four years, with October 22, 2002 as the base year. Once the phase in occurs, the maximum increase each year cannot exceed three percent.
The proposal also sets a limit of 2,000 acres per person on property eligible for current use valuation, also phased in over four years. Plans are for the assessment of $532 per acre to increase to $770 per acre.
McAlpine admitted he believes the assessment is too low, that most land is worth far more than $770. What he objects to is the open-ended three percent increase possible each year after the phase-in.
Using examples and charts provided by Bass, McAlpine explained the impact on owners of $100,000 homes in the county &045; not in any municipality. Currently the assessment for the state is 10 percent of the value, or $10,000, with a $4,000 homestead exemption. State tax is 65 mills.
The exemption would increase of $50,000, and millage would drop to 35, but homes would be assessed at full value.
That means taxes on the home would rise from $235 to $371 annually.
Business assessments would increase as well. Again, using property valued at $100,000, McAlpine said annual taxes would jump from $570 to $834.
Except for taxes on cars, all the taxes would go into effect in October, 2004, he continued. The taxes on cars starts in October, 2009.
A new farmstead exemption has been set up that provides an exemption from all state property taxes that doesn’t exceed the assessed value of 200 acres of qualifying property. McAlpine made it clear that a person can have a homestead exemption or a farmstead exemption, but not both.
Using a copy of a page from House Bill 3 that showed the distribution of property tax levied by the state, McAlpine explained that the first year of the tax would benefit schools a great deal. The Department of Education would get 3 mills of the 6.5 mills, or 44 percent, the first year. The millage would decrease in subsequent years, leveling off at 15.23 percent.
The General Fund and Soldiers Fund millage also would decrease.
What goes up, however, is the Alabama Excellence Initiative Fund. By the time the phase-in is complete in 2008, that fund would be getting 68.25 percent of the state property taxes.
McAlpine called that a "slush fund" and questioned how much of that money would benefit this area.
With no state representatives or senators living here, he asked, "how much money do you think Marengo County’s going to get?"
He admitted that the discussion with Bass didn’t touch on the accountability portions of the proposed amendment or to income or any other tax proposals.
Most everyone doesn’t mind paying taxes for services, but "Our concern is where our money is going," McAlpine said. "I hope I’m wrong…but I don’t think some people are telling the truth."