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1. ESTABLISHING THE VALUE OF PROPERTY:
The Director of Equalization participates in
this first step, which is to establish a value of all property within
the boundaries of each unit of government. Because all property
is not of equal value, individual values are arrived at based on the
price the property would bring if sold. This selling price, determined
by the sale price of comparable properties, and known as the true and
full value, is what establishes the value of the property.
2. ESTABLISHING THE AMOUNT OF TAX:
The Director of
Equalization does NOT participate in this process. Other
entities determine the amount of tax dollars needed to meet the costs
of operating a unit of government. The higher the cost of
operating the city or school district, the larger the revenues required
from property taxes.
3. ESTABLISHING A TAX RATE:
The Director of
Equalization does NOT determine or calculate the tax
rate. Our information is shared with other entities who establish
a tax rate for individual pieces of property, based on values and the
amount of tax dollars needed.
Each unit of
government is responsible for a portion of the tax rate applied in the
collection of tax dollars. These units of government include:
city government, school district, county government, special districts,
etc. The tax rate for all property in a local unit of government
is arrived at by dividing the value of all the property into the amount
of tax dollars needed to complete the budget of that local unit of
government.
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