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WPCNR QUILL & EYESHADE COMMENTARY. By John F. Bailey and the WPCNR Editorial Advisory Committee. July 2, 2006: Governments often are criticized for being bastions of bureaucratic bungling and inefficiency. That type of criticism dare not be applied to the City of White Plains which saw to it that real estate tax bills began arriving in mailboxes around town precisely as scheduled on July 1. The new bills are for the first of two payments covering Fiscal Year 2007, and include both city and school district taxes. County taxes, sewer taxes, and water charges are billed separately.
“PR” On Your Tax Bill: Better do the math, Mr. & Mrs. & Ms. White Plains! Photo of July 1, 2007 Tax Bill by WPCNR News.
A member of the WPCNR Editorial Advisory Committee was overjoyed to discover that numbers on his tax bill showed a percentage increase over last year’s taxes of only 5.62% for the city portion and 5.47% for the school portion. After all, we had been told by officials to expect a tax hike of more than 7% for the city portion and more than 8% for the school portion.
But, the joy soon turned sour upon the realization that the percentages shown on the tax bill merely referred to the increase in the “total tax levy” and did not reflect the actual increase in taxes which residents actually have to pay. The actual percentage increase in dollars to be paid is much higher than the “total tax levy” percentage figures shown.
The only way to know for sure how much your taxes have gone up is to dig out last year’s tax bill, put on your green eyeshade, take out your very best calculator, and make a comparison with this year’s bill. You can’t take the percentages shown on your current tax bill as being the final arbiters of how much more you’ll pay.
When you run the numbers, you’re likely to discover that your actual increase is about 60% more than the percentages of “total tax levy” shown on the tax bill.
There is another possible fly in the ointment. If your STAR exemption (a discount in the assessed value of your property applied to reduce school taxes) has changed, the amount you pay in taxes and the percentage increase also will be changed.
Rosy Scenario?
So, was the member of the WPCNR Editorial Advisory Committee guilty of making a false assumption upon the first reading of his tax bill? Or, is government guilty of attempting to deceive by showing only the percent increase for “total tax levy,” and leaving out the percent increase you actually must pay? Perhaps a bit of both?
Rather than dwelling on those questions, we thought we’d present an example of how you can figure out for yourself just how much your White Plains real estate taxes have gone up from Fiscal Year 2006 to Fiscal Year 2007. Fasten your seat belts for a bumpy ride!
First, examine last year’s tax bill for the comparable period, and the current bill. If your taxes are paid from an escrow account controlled by the lender who holds the mortgage on your property, you may need to obtain copies of the actual bills from the lender.
Second, subtract last year’s “total tax amount” from this year’s “total tax amount.” This will give you the actual dollar amount that your taxes have gone up (the increase).
Third, divide the dollar amount of the increase by last year’s “total tax amount.” This will give you the percentage that your taxes have increased.
In the case of our WPCNR Editorial Advisory Board member, last year’s “total tax amount” was $11,071. This year’s “total tax amount” is $12,049….an increase of $978, or 8.83%. That percentage is about three times the rate of inflation claimed by the Federal government for last year.
According to another WPCNR Editorial Advisory Board member who delved back into their tax history the last five years, their city and school taxes have gone up 23% since FY 2002, and the board member says if he had not had the STAR exemption the increase would have been 47%!
This Board member raised his eyebrows in shock when he discovered that 18.2% of that 23% has been slapped on him by the city and the school district in just two years! (FY 2006 and 2007)
According to an editorial in The Journal News which dealt with the tax trauma being felt in the Mahopac school district, taxes in Westchester have risen about 46% in the past 5 years. You can test whether that’s the case for you by finding a tax bill from 5 years ago and performing the calculations we’ve outlined. You can then easily project ahead, and add the 46% increase — or whatever the 5 year increase was — to your current taxes to get a hint of what may lie in store if nothing changes. When evaluating the results, don’t forget that the White Plains school district now is contemplating a bond issue of more than $60-million, on top of its regular budget.
Some taxpayers have trouble understanding why, with all of the positive talk about the development boom in White Plains, local taxes keep going up much faster than inflation. Officials cite various factors involving state pension fund requirements, cuts in state aid, tax refunds given to property owners who have successfully challenged their assessments, and requirements of union contracts (who negotiated the contracts?).
Our Board member who discovered their 18.2% hike in two years noted that this means that the homeowner appears to be paying more than their “fair” share of the tax burden.
Some taxpayers may be tempted to suggest that higher taxes also could be a result of the city and school district “spending like drunken sailors.” However, any such suggestion would unfairly malign drunken sailors.
