Hampton Metropolis Council considers decreasing actual property tax price as finances discussions start – Each day Press
Posted On March 12, 2023
A roughly 10% increase in residential real estate tax assessments in Hampton has the City Council considering a reduction of the tax rate to offset the burden to residents.
Hampton residents received their real estate assessments last month, with most seeing increases in their home values.
Assessor Libby Griebel told the council earlier this year the mean or average assessed value of a single family home in Hampton increased by $22,223 to $242,190 — not counting new buildings or those with permits for improvements.
At the current tax rate of $1.18 per $100 of assessed value, that means the owner of an average single family home would pay $262 more in taxes a year.
During a budget work session Wednesday, City Council members discussed lowering the real estate rate to somewhere between $1.12 and $1.16 per $100 of assessed value but did not reach a consensus.
City Manager Mary Bunting said the city is still in the “preliminary” stages of the budget discussion.
Karl Daughtrey, Hampton’s director of finance, said each penny in the real estate tax rate amounted to about $1.4 million in revenue for the city. If the tax rate is maintained at $1.18, the city estimates it would bring in $173.37 million in revenue for the city for the upcoming fiscal year — about $13.98 million more in estimated revenues than this fiscal year.
City officials warned about considering the expenses needed to run Hampton.
Brian DeProfio, assistant city manager, noted the city is facing several budget challenges for the upcoming fiscal year, including retaining and attracting employees due to a global decline in the workforce and inflation-fueled wage growth. He said the city has “historically been lower staffed than other localities in the region,” and needs to keep its wages “up to speed” with other competitors.
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Other challenges DeProfio mentioned include inflation, infrastructure maintenance, and an evolving tax base which has become increasingly dependent on residential and multifamily.
Last year, there was a significant spike in personal property assessments due to supply chain issues and increased consumer demand.
Commissioner of the Revenue Ross Mugler told the council that while supply chain issues persist, he said the city expects values “to continue to stabilize and normalize” by the end of the year.
Because of the high personal property taxes in 2022, the city decided to tax residents’ automobiles at 75% of their assessed value for personal property taxes. This year, the council will determine whether to tax vehicles at 100% of their value or, once again, to use a lower assessment ratio. Mugler discussed potential scenarios that would tax cars at 90 or 95% of their assessed value. The personal property rate is currently $4.50 per $100 for most vehicles.
Bunting cautioned those attending the meeting that the city doesn’t have complete revenue estimates for the upcoming fiscal year. Depending on whether the revenue is higher or lower than expected, it may impact what tax rate the council ultimately approves.
Bunting said she would update the council and the public on projected revenues as she gets more information.
Josh Janney, [email protected]