Okay, okay, it's spelled differently. Does a decrease in my levy mean a decrease in my taxes or not? And is there anything I can do about it one way or another?
A LOT is going on this week. High on the Alert list is a petition that is being circulated to enable citizens of the Sioux Falls School District to vote yes or no on a proposed tax increase. Without a valid petition submitted in time, the tax increase will happen without a citizen vote. Your signature is needed. This is a time-sensitive project (read: EMERGENCY) so please check your emails and social media for updates throughout the day. More to come.
Remember last week’s post about Opt-Outs in Don’t Be Confused (Part 2). We delve into property taxes and levies down below, which is another part of the story.
Government needs to go on an extreme financial diet. Something like a governmental gastric bypass, or maybe just sewing its lips shut.
— Jeff Childers
PROPERTY TAXES - Paying Rent to the Government for What You Own
Wow! What a bargain! Right? Right...?
The executive summary of a recent school district budget proposal says this: “For the District’s homeowners, the school levy is projected to decrease by 12 cents in 2023. The average school property tax increase over the last 23 years for a typical house in the Sioux Falls School District is approximately 1.4 percent per year.”
It’s kind of like magic, isn’t it? They’re gonna spend millions of dollars MORE, but for you, personally, it’ll be no big deal, huh?
Except for a few things. That 1.4% average yearly tax increase amounts to a 32.2% total increase over that time period for “a typical house....” And the average doesn’t tell you how those increases were made over time, or why 23 years is the period they averaged. Was last year’s increase 1.4%? Or was it 5%? We can’t know from their statement.
Also note: Housing values have skyrocketed in the past year and a half — an average 13.5% increase in the Sioux Falls area. Which means assessments will likely skyrocket, too, for the “typical” house. A levy is dollars you pay per $1,000 taxable value of your house. So even if a levy is reduced by 12 cents, the total amount of the tax will go UP because you’re paying the levy on those extra thousands.
Here’s what that might look like for a house assessed at $200,000 for 2021 taxes. We’re using the Minnehaha County Levies rate calculator for 2021 taxes payable in 2022: https://www.minnehahacounty.org/dept/au/levies/levies2022.pdf
The taxable value of a house is 85% of assessed value.
Year 2021 taxable value: $170,000 X $16.41 levy per thousand = $2790
If the levy is reduced by 12 cents and the property value increases by 13.5% —
Year 2022 taxable value: $192,950 X tax levy $16.29 per thousand = $3143
PS: Lincoln County taxes are higher.
Perhaps it’s time to put on the breaks. This is not to suggest that we don’t need government; we do. Or that government can operate without revenue; it can’t. But increased spending year over year is built into government’s 5-year plans and 10-year plans, which add new programs that increase costs even more than “normal” inflation. This is emblematic of ALL government spending boards, whether they’re local, state, national, or international. Your property is their piggy bank.
This is a good place to find out how property and school taxes are calculated in South Dakota: https://dor.sd.gov/individuals/taxes/property-tax/#calculate