The #1 question I'm getting as property tax bills are hitting mailboxes, is "How are my property taxes calculated and why have they gone up?!"
Life ... Death ... and Property Tax.
Property Taxes represent a property owner's portion of the local government's budgeted spending for the current year. Increases or decreases in property tax amounts depend on the assessed valuation of your property in tandem with the budgetary needs of local taxing entities in Allen County, such as the City of Fort Wayne municipal government (police, fire, parks, community development, public works), Allen County municipal government, public school systems, and public libraries.
How is the City of Fort Wayne municipal budget determined?
Each year, the City of Fort Wayne submits an adopted budget to the Indiana State Department of Local Government Finance, which provides oversight of the process.
The Department of Local Government Finance ensures the proposed spending of the City of Fort Wayne (or other taxing units) has the authority to level property tax. If the proposed spending exceeds the unit's anticipated property tax allotment, the City of Fort Wayne is required to revise its budget to bring it in line with the allotment.
Simply put, this process is similar to your relationship with your bank, which tells you how much money you have available, not how you spend it.
The City of Fort Wayne makes any requested adjustments, and the Department of Local Government Finance approves the funded budget, thereby developing tax rates for the year (this happens for each taxing unit, not just the City of Fort Wayne).
How does Property Tax work?
Property taxes are paid based on property values, as assessed, two years ago. Meaning, your property's value, based on 2021 property sales, becomes its assessed value as of January 1, 2022. You then pay the taxes based on your 2022 assessed value in 2023.
The tax assessment and billing cycle begin with the assessor's valuation of your property. Properties are valued using mass appraisal techniques in conjunction with area-specific property sale records. Also considered in your assessment are the age, grade, and condition of your property.
Finally, in the adjustment process, each year real property sales data is used to determine if the value of properties in your area should change to match the market value found in the previous year's property sales through a trending analysis.
Cyclical reassessment also occurs when the County Assessor physically visits 1/4 of all properties annually to verify conditions, grades, and other parts of your property record card.
The Department of Local Government Finance uses several statistical tests to determine whether assessed values are in line with property sales in the area. They also run tests to ensure that assessments are fair and treat all property owners equally. Once these tests are passed, the assessment is approved by the Department of Local Government Finance.
Upon receiving passage from the Department of Local Government Finance, the County Assessor then posts the values for the County Auditor to use in determining annual tax rates.
There's no way my property is worth what it's assessed for. Is there anything I can do?
Fortunately, for citizens of Allen County, there is an appeal mechanism if you disagree with your property tax assessment (not your tax rate). The Allen County Property Tax Assessment Board of Appeals (PTABOA) allows taxpayers to initiate an appeal of the current year's assessed valuation. While an increased assessment is likely a cause of record inflation, PTABOA does allow individuals to appeal an assessment when they believe their property has been assessed over value.
In Fort Wayne, our quality of life and place depends on the property tax collected by our taxing units. The City of Fort Wayne relies on property tax revenue to pay for our police and fire departments, roads, stormwater management, parks and recreation, and overall improvements to the community. As your councilwoman, I'll make certain that your money is spent responsibly and in the best interest of the constituents in District-2, join me in moving #FortWayneForward.
