At its regular Tuesday meeting at 7 p.m., the Danville City Council will hold a public hearing on maintaining the current real estate tax rate. The council is expected to keep the existing rate of 83 cents per $100 of assessed value, though the assessed values are expected to rise.
Danville reassesses property values every two years. A reassessment is now underway.
During a reassessment, a locality reviews and adjusts property values so that they’re consistent with market values. Virginia law requires localities to perform reassessments on a regular basis.
Projections for the current reassessment anticipate “an increase of not more than 6.5% in assessed values of existing properties as compared to the current assessment,” according to the staff report in the meeting’s agenda packet.
This projection does not include anticipated increases from new construction.
This item is a first reading on the council’s agenda, meaning council members will hear it for the first time and vote on it in a later meeting. Residents will be able to share their opinions on this item during a public hearing at the meeting.
The maximum 6.5% average increase in property values would mean that a property currently assessed at $100,000 would be reassessed at $106,500. This would raise the annual real estate tax bill on that property from $830 to about $884.
Property taxes are paid in two installments every six months, so each installment would increase by about $28, and the total annual payment would increase by about $54.
The proposed budget for the upcoming fiscal year includes a figure below the 6.5% maximum, estimating that the average increase in assessed values will go up by 5.93%.
“The estimated increase is an overall average, and individual properties may increase at a greater or lesser percentage,” the staff report said.
A 5.93% increase, while maintaining the 83-cent property tax rate, would yield an additional $1.7 million in revenue for the city.
That number is not set in stone because the assessment is not yet complete, the staff report said.
“In previous years, the closer staff got to concluding the reassessment, the projected percentage increase in values declined,” according to the report.
Based on that anticipated increase and changes in other revenues, the total upcoming budget for the city is expected to be about 2.8% higher than last year’s.
City staff recommends that the city council maintain the existing real estate tax rate of 83 cents during this reassessment. The reassessed values will go into effect at the start of the next fiscal year, which begins July 1.
The city council meeting will be followed by a work session.
