We are in much deeper economic trouble than it would appear when we take a close look at property taxes in Ada County.
The Daily Paper’s Cynthia Sewell filed a TAX STORY Thursday which was accurate enough, but didn’t sound the alarm we should all be hearing.
Sewell properly noted that property values are going down, but tax LEVIES are increasing just to keep local governments at or near their historic levels of revenue (and services).
What this means is your taxes, AS A PERCENT OF VALUE have increased at least 30% in the past four years. Simply put, if the value of your real estate has DECLINED and you continue to pay the same dollar amount, your taxes have in fact INCREASED by the same percentage as the decline.
Put another way, if you have $100 in the bank and earn $10 interest, the return (tax) is 10%. If the deposit is lowered to $50 and you get the same $10 return, the interest rate (tax) is increased to 20%.
Boise used to depend on unbridled growth to fund government. This resulted in low taxes as a percentage of property value which made the city “business friendly.” Those days are gone. Times are much worse than they appear at first blush.
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