Don't monkey with tax value

There is a scene in what has become one of my all-time favorite movies, O Brother, Where Art Thou? in which radio listeners are described as going all apey over a new song.

Going all apey is a good way to describe the way people have been reacting to property tax reassessments in our neighboring counties, and for good reason: Tax officials there have been monkeying around with the value of peoples homes, and have been caught in the act.

Actually, they havent been monkeying with the value - theyve been monkeying with how much the government says their homes are worth, with little regard for what the free market dictates.

Its made many homeowners angry. But the fallacy of their complaints is that the homeowners are somehow getting ripped off. Actually, the opposite has been happening: The value of property has been rising, but to avoid political fallout, tax assessors kept the value on the countys tax books low. Instead of rising a little at a time like inflation, the assessed value jumps up in larger increments when the state notices the books have been cooked.

Heres a great example, from Lincoln County - which actually has a far worse problem than Augusta, but with fewer people, there was less noise when the people went all apey.

A woman called the other day furious about her tax bill. She moved a year ago from New York, she said, and suspected the tax assessors were pleased with themselves for sticking it to a Yankee.

How bad did they hit her? Well, her home was on the tax books one year ago for $68,000 was suddenly reassessed at $168,000.

Outrageous!

But heres the rest of her tale. The home in question is lakefront property, complete with a boat dock. When the woman and her husband bought the home a year ago, they paid $164,000. Now the tax assessor says the home is valued at $168,000. Thats entirely reasonable, she offers - while also admitting that she didnt bother to complain to county officials last year when her home was undervalued on the tax books by nearly $100,000!

You cant blame the woman, or any other taxpayer, for wanting to pay as little in taxes as possible. The government already gets more than it should. But the best way to keep the ship afloat is for everyone to bail equally - not for some to get a break while others are swamped.

Gov. Roy Barnes, in an election-year effort to out-cut Republican tax cutters, has come up with an idea for curbing such nonsense: He would limit property tax reassessments in any county to 5 percent per year.

But whats wrong with this picture? What if you live in a fast-growing county, in which demand for housing drives the value of your property up by, say, 10 percent in a year? Youd feel pretty good about your investment paying off so handsomely, but what would entitle you to pay taxes on an artificially lower value?

An artificial cap on reassessments would do three things:

It would punish the governments of fast-growing counties - i.e., those counties most likely to have Republican leadership - whose land value is rising faster than 5 percent a year (Columbia Countys grew just over 6 percent last year);

It would rig land values, which should be determined by the free market; and,

It would virtually guarantee that everyones property tax assessments would go up 5 percent a year. No government could afford the possibility that the free market would drive values up higher than that in succeeding years, so an automatic 5 percent increase would be a hedge against hitting the cap.

Looked at this way, Gov. Barnes is promising to raise your taxes 5 percent every year. Thats enough to make anyone go all apey.

(Barry L. Paschal is publisher of The Columbia County News-Times. E-mail comments to bpaschal@newstimesonline.com, or call 863-6165, extension 106.)