## Your community has a need for \$1,000,000 in property taxes to fund operations. It has 1000 homes in the jurisdiction. Explain the positives and negatives of the following options for taxing the residents and include some examples of how it would affect homeowners: 1. Each property owner in the community pays an equal share of the property taxes (\$1000 per year). 2. The community evaluates th

Your community has a need for \$1,000,000 in property taxes to fund operations. It has 1000 homes in the jurisdiction. Explain the positives and negatives of the following options for taxing the residents and include some examples of how it would affect homeowners:

1. Each property owner in the community pays an equal share of the property taxes (\$1000 per year).

2. The community evaluates the market value of each property and the community as a whole. They determine that the average home is worth \$100,000 (although the values vary greatly) and decide that each homeowner will pay \$10 per \$1000 of assessed value. The result is an average valued home would have a \$1000 property tax. Higher priced homes pay more and lower priced homes pay less.

3. The community evaluates the market value of each property and the community as a whole. They determine that the average home is worth \$100,000 (although the values vary greatly). They decide that they will offer a discount to long term residents of the community. Anyone who has lived in the community for more than 25 years and is over age 60 receives a 50% reduction in taxes. As a result, the new rate is \$13 per \$1000 of home value. The result is an average valued home would have  \$1300 in property taxes, however a long-term resident in the same home would only pay \$650. Higher priced homes pay more and lower priced homes pay less.