Democracy on the Front Lines
City Administrator’s Blog
Walter Denton
October 19, 2006
An article appeared in today’s O’Fallon Progress newspaper describing why O’Fallon homeowners have seen a 21% increase in their property assessments over the past three years. The article accurately reported that the increase is not due to changes in tax rates but in the “Township Multiplier.” The multiplier is a method used by St. Clair County to adjust property assessments in a particular township.
My purpose with this blog is not to argue with anything in the Progress article, because it does a good job of explaining the situation. Rather, I will provide more background on the property tax bills and what we are doing to improve things in the future.
When property tax bills were mailed to property owners last June, we received numerous calls from residents who were confused why their taxes had increased when the City’s tax rate had been reduced. The confusing part was Line 6 on the left side of the form that was the “Township Multiplier” (1.068). The multiplier raised the Fair Property Value of every piece of property in O’Fallon by 6.8% ($13,600 on a $200,000 home). The 6.8% was added by the County Assessor and is based on the increased sales prices of existing homes in O’Fallon over the past three years.
We received calls about how the City is “overtaxing” residents, but it has nothing to do with rates. This year’s annual budget reduced the City’s tax rate so residents should have seen a reduction in their City taxes. Each year, we send a report to the county estimating the Equal Assessed Value (EAV) of all properties in O’Fallon, including the new homes built in a given year. And over the years, the property tax revenue from the county has been remarkably close to the estimates we give them. So while the county has placed multipliers on the property assessments, we have not received any revenue windfall as a result.
As far as we can tell, the county imposed the across-the-board multiplier on all existing homes in O’Fallon Township and did not place new homes on the tax rolls. So from the City’s standpoint, we will get the same amount in tax revenue as we estimated in the budget but the tax bills overcharged the existing homeowners while giving the new homeowners a free ride. No one likes to pay property tax, but all homeowners in O'Fallon should be taxed fairly.
Using the county’s tax records, we conducted a review of properties in O’Fallon with the wrong tax rate and identified more than 400 residential properties that have been on our water system more than a year but are not on the county tax system. We have taken our list to the County Assessor’s Office and are working with them to develop a system to include new homes on the tax rolls more quickly. If the county includes new homes on the tax rolls in a timely manner, we may be able to reduce the Township Multiplier next year.
Please remember that this is not a tax increase imposed by the City Council. We have held the line on property tax rates for the past eight years. The multiplier has nothing to do with the City and we did not have any knowledge of the multiplier until we received the tax bills along with everyone else. We have no control on the sales prices of property or the county’s decision to raise the Township Multiplier. If you feel your home’s value increased inappropriately, the appeal procedure for property owners is to appear before the County Board of Review and show that their property did not increase in value by 6.8% last year.
Speaking of property taxes, we also receive complaints occasionally about how O’Fallon has the “highest taxes in St. Clair County.” For the record, O’Fallon residents’ total property tax rate was ranked 20th out of 24 cities in St. Clair County in 2005. The highest rate was Sauget with 24.5947 per thousand. The lowest rate was Mascoutah at 6.6945, followed by Shiloh, Millstadt and Freeburg. O’Fallon’s rate was 7.4414.
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