City Council Regular Meeting
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Old Business   Item #: A.
Real Estate Tax Rate
The Real Estate reassessment is currently underway. Current projections anticipate an overall increase of 3.05% in assessed values as compared to the current assessment. The majority of the anticipated increase, or 3.05%, relates to the reassessment of existing property, while approximately 0.5% is attributed to new construction.
The Commonwealth of Virginia Code requires that reassessments resulting in an increase in assessment of 1% or greater be advertised as a tax increase. The advertisement of the real estate tax has to be published 30 days in advance. At that time, the City advertised a real estate tax rate of $0.84 per $100 as an effective tax rate increase of no more than 3%. Current data anticipates that maintaining the current rate of $0.84 would represent a 2.5 cent increase from a revenue neutral rate. For example, property assessed at $100,000 in the current year would be reassessed at $103,000 and the tax bill would increase from $840.00 to $865.20 annually, an increase of $25.20 annually or $12.60 per installment. The estimated increase is an overall average and individual properties may increase at a greater or lesser percentage, The increase in the general reassessment together with new construction is anticipated to generate a $579,000 increase in real estate revenue for the FY 2021 Budget. The Proposed Budget includes an increase of $180,000 representing an estimated 1.26% increase in assessed values.
It is recommended that Danville City Council adopt the attached Ordinance maintaining the current real estate tax rate.
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