- Last Updated on Thursday, 28 October 2010 18:11
- Published on Thursday, 28 October 2010 18:11
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Colonial Beach property owners narrowly missed paying more in real estate taxes due to Town Council failing to act in a timely manner when presented with increased real estate assessments from a 2009 assessment done in Westmoreland County.
“It’s illegal to raise peoples’ taxes without a public hearing. That’s wrong,” remarked newly elected town council member Gary Seeber in a telephone interview Monday. Seeber has spoken up at the August, September and October town council meetings urging council to reduce the current real estate tax rate of .60 per $100 of assessed value by .02 cents in order to avoid a defacto increase in real estate tax revenue to property owners.
According to Seeber, there is an approximate 2 percent increase in assessed values of land and improvements in Colonial Beach due to a 2009 real estate assessment by Westmoreland County. This approximate 2 percent increase in assessed value causes an approximate 2 percent increase in revenue to the town from real estate taxes.
Virginia State law provides remedies to protect property owners from defacto real estate tax increases that occur when property assessments increase. Virginia Code Section 58.1-3321 contains very specific language governing the steps localities must take when real estate assessments provide for an increase of 1 percent or more of the total real estate tax levied.
“When any annual assessment, biennial assessment or general reassessment of real property by a county, city or town would result in an increase of 1 percent or more in the total real property tax levied, such county, city, or town shall reduce its rate of levy for the forthcoming tax year so as to cause such rate of levy to produce no more than 101 percent of the previous year’s real property tax levies, unless subsection B of this section is complied with…” — VA Code Section 58.1-3321 A.
“B. The governing body of a county, city, or town may, after conducting a public hearing, which shall not be held at the same time as the annual budget hearing, increase the rate above the reduced rate required in subsection A above if any such increase is deemed to be necessary by such governing body.” — VA Code Section 58.1-3321 B.
Although the town was made aware of the increase in assessed values that were potentially over the 1 percent threshold, no steps were taken to adjust the real estate tax rate by town council in order to comply with state requirements until recent questions raised by the Journal brought the issue to light.
According to Westmoreland County Administrator Norm Risavi, results of the 2009 real estate assessment or the “land book,” were sent to Colonial Beach in “late March or early April” and the results sent “shows assessed values and adjusted values.”
“I think they would be in violation of the law if they take no action. The law is clear,” Risavi further noted. Adjustments to real estate taxes were made in Westmoreland County before the county’s budget for 2010-2011 was voted on.
Colonial Beach Town Manager Val Foulds advised this reporter on Monday, Oct. 25, that “there is no opportunity for the town to do anything until next year’s budget” citing counsel provided by Town Attorney Andrea Erard. In a telephone interview on Tuesday, Erard told this reporter “The town has complied with all state laws.” Erard further advised that “once the land book is delivered, we are not able to adjust the tax rate.” Erard further explained that “if there is a defacto tax increase, then we have a hearing in the spring.”
The town’s budget for 2009-2010 reflects revenues expected from real estate taxes to total $2,703,733. The town’s budget for 2010-2011 reflects expected real estate revenues to total $2,793,597, which includes $70,000 in delinquent taxes. It appears from the revenue figures that the town council did not take in to account the new real estate assessed values when determining the revenue figure for real estate taxes for the 2010-2011 budget.
According to town council member and budget committee chair Sparky Ridgely “we’ll be discussing this at Thursday’s budget committee meeting.” The budget committee is scheduled to meet this Thursday, Oct. 28, at town hall.
As this story continued to unfold on Tuesday, Oct. 26, at approximately 2 p.m. The Journal received notice of a special meeting called by Town Council on Nov. 11 at 7 p.m. to pass Ordinance # 592 which lowers the real property tax rate from .60 per $100 to .58 per $100 of assessed value.
When questioned by the Journal about the issue of real estate tax adjustments, Mayor Fred Rummage noted “Whenever we have a chance to reduce taxes, I’m all for it.”