My Turn, Chip Main: Understanding the revaluation process
Published 12:00 am Sunday, March 19, 2023
By Chip Main
The recent real estate market has caused housing and land values to increase substantially across the region. In Rowan County, real estate valuations have increased by an average of 44.96% since the last valuation period, which ended December 31, 2018. Here are some facts about Rowan County’s recent property revaluation.
Last year’s budget was based on a total taxable property value of $14.4 billion. That figure includes following categories:
Real Property (Real Estate) $10.7 billion
Personal Property (Boats, RV’s, Mobile Homes, Business Property) $1.6 billion
Public Utilities (Example: Duke Energy) $881 million
Vehicles $1.55 billion
Less Adjustments (Appeals, Collection Rate, Exemptions) $292 million
During any revaluation process, real property values could move up or down based on market values. Market values are calculated using the actual sales data of all properties sold during the preceding four-year period. However, the other categories (personal property, public utilities, vehicles, etc.) typically depreciate over time and their taxable values are reduced.
Using the required data between Jan. 1, 2019 through Dec. 31, 2022, almost 12,000 residential property and 700 business property sales were used to calculate the “real property” revaluation. These are the revaluation figures for all categories:
Real Property (Real Estate) $15.5 billion
Personal Property (Boats, RV’s, Mobile Homes, Business Property) $1.5 billion
Public Utilities (Example: Duke Energy) $837 million
Vehicles $1.53 billion
Less Adjustments (Estimated) $831 million
Based on the revaluation results, the 2023-24 budget is projected to be based on a total estimated taxable property value of $18.5 billion. While real property values increased by 44.96 percent, all remaining taxable property fell by $683 million, or 18.5%, creating a total estimated tax base increase of $4.1 billion, or 28.5%.
Last year’s $14.4 billion tax base will generate approximately $95 million in revenue for Rowan County during the 2022-2023 fiscal year, ending June 30, 2023. If the current tax rate remains unchanged, the estimated $18.5 billion tax base would generate approximately $122 million for the 2023-2024 fiscal year, beginning July 1, 2023.
The law requires that the Rowan County manager calculate the “Revenue Neutral Tax Rate” and report that rate to the Board of Commissioners. The Rowan County Commissioners will have the opportunity to reduce the tax rate to lessen the results of the increases in real property values. The new tax rate will apply to all taxable items.
The revaluation process is an equalization process required by NC General Statute. This process is completed every four years. The property owner has the right to appeal their value if they have a valid reason to believe the new value is incorrect. The first step in the appeal process is to complete the form at the bottom of the revaluation notice and return it. The form can also be completed online on the County’s website. The Board of Commissioners has extended the 15-day appeal period to April 14.