Franklin real estate reassessment looking up

Published 9:51 am Friday, May 9, 2014

FRANKLIN—After an initial projection of the real estate value in Franklin dropping 8 percent, many on council considered it good news when the final projection came in at only a 4.35 percent drop.

The revenue loss for the city would be $226,598, said City Manager Randy Martin. He added that the revenue neutral tax rate increase to approximately recoup that figure would be about 4 cents. Even with that, the city would lose approximately $4,000 in revenue as compared to the 2013-14 budget.

In the reassessment, some areas are actually increasing in value, while others are decreasing. The total value of the agriculture 20-99 properties is falling the most at -31 percent. The drop in single-family home value will impact the city the most, as the -10.12 percent decrease will drop property value about $36 million in the city. Agriculture 100 and up, which is a small portion of the Franklin-area property, will fall -1.38 percent.

Multi-family homes will rise 10.08 percent and commercial value will rise 9 percent.

Using a base example of a home worth $170,000 in 2013, the current 90-cent tax rate would cost residents $1,530. This year, the -10 percent reassessment would drop the home in value to $153,000, and they would pay $1,377, or a loss in revenue of $153 to the city.

Should council chose to increase the tax rate, the result of this increase would still have single-family residential property owners paying less in tax burden than they did last year.

Due to the reassessment, the weight will instead shift to multi-family and commercial property owners regardless of the action taken by council.

For example, a commercial business worth $170,000 in 2013 would have paid $1,530, while in 2014, that property would increase in value to $185,300 at 9 percent, and would be paying $1,667 in taxes. That’s a $137 gain to the city.

If council decides to enact the 4-cent increase, single-family residential owners with a home valued at $170,000 in 2013 would have their home reassessed at $153,000, and pay $1,438 this upcoming year, or a $92 decrease from 2013.

“The tax burden is down by $92, in increasing the rate,” said Martin. “Residential property taxes in almost every case, unless they built an addition or something else unique, is going to go down regardless of what council does.”

Multi-family residential home owners with property valued at $170,000 in 2013 would see that property go up in value to $187,000 and would pay $1,758 in taxes this upcoming year, or a $228 increase.

Commercial property owners with land or buildings valued at $170,000 in 2013 would see that go up in value to $185,300, and they would pay $1,742 this upcoming year, or a $212 increase.

“There is going to be a burden shift, whether it is fair or unfair,” said Martin.

“I believe it is fair, based on the assessment.”

Total real estate value in Franklin based on the reassessment is projected to be $556,219,200 in 2014, which would be down from $571,544,231. The highest it has been was in 2009, when real estate values were at $671,857,100.