FAQ

Q. What is the Property Tax Levy?

A. Town revenue comes from several sources:  state payments, licenses and fees, fines etc. All these funds are subtracted from the budget and what remains is the property tax levy and is paid by a Property Tax.

Q. What is the difference between the present Property Tax and the R.I.G.H.T proposal?

A. Current property taxes are calculated on market values.  This proposal will calculate taxes based on changes in the tax levy.  For a new owner the initial tax will be the market value, as it is today.

Q. Do we have to revalue property?

A.  Properties change value over time. Without revaluation new owners will pay taxes based on older and usually lower values.  Revaluation provide a fair tax rate based on market values so new owners can be fairly taxed on current values.

Under the R.I.G.H.T plan only sold property will need to be revalued, saving thousands of dollars each year.

Q. As a homeowner, will my taxes be lower under the R.I.G.H.T proposal?

A. For the majority, most likely yes.  Under the R.I.G.H.T plan if the levy increases, all owners will get increases but only by the same percentage as the levy. Today, with reassessments for everyone, thousands of owners pay lower taxes which must be made up by the majority who therefore get taxed more than needed. This will stop. 

Q. What happens when I sell my home?

A. The buyer and you agree on a price. The first year's tax bill for the new buyer is based on the current assessed value of the home and the tax rate in force at the time, exactly like the present practice. Subsequently new owners become existing owners and taxes will be levied according to the same percentage guidelines as for every other property owner.

Q. Won't new buyers resent paying a higher tax than someone living in a similar house?

A. New homeowners currently pay the traditional ad valorem tax and this will not change.  People living in similar houses might pay different taxes, just as we do when we pay our state taxes and our federal taxes.  There is nothing unfair or unprecedented about it.

Q. What if I leave my home to my family when I die?

A. Transfer to a spouse who continues to occupy the property will result in no change at all. Transfer to anyone else, be they children or not, will be considered a sale and the property will be revalued in the same way as any sale.

Q. What if property values decline?

A. Your taxes will depend on only two things:

   1)  what your property tax was last year and
   2)  how much the tax levy increased.

If the levy goes up, you and everyone else pay more. If it goes down, everyone pays less. And the percentage change is the same for everyone. Once you have purchased your home, any change in its market value has no effect on on the Property Owner's Tax. (see next question).

Q. Are home improvements taxed?

A. Improvements are taxed by adding the traditional ad valorem tax on only the improvement to the R.I.G.H.T tax. If a physical change results in a decrease in value the property may be reassessed and a new base tax established.

Q. What does progressive mean?

A. A progressive system places a greater burden on those who have greater resources.

Q. Is the R.I.G.H.T plan progressive?

A. Yes and no. Tax bills for people who purchase more expensive homes are greater than those with less expensive purchases made at the same time and remain so. On the other hand taxes are not related to income going forward so progressivity is reduced.

Today's system is not progressive at all and can even become regressive when a less costly home rises in value more rapidly than a more expensive home as frequently happens.

Q. What makes the R.I.G.H.T plan different from the current system?

A. The R.I.G.H.T plan difference becomes apparent after a person purchases his home. Once a fair tax bill is established, according to the value of the property at the time of purchase, any future changes in the tax bill, are in direct proportion to changes in the tax levy. Everyone shares the cost and everyone is treated in the same way.

When the levy increases, everyone's taxes increase by the same percentage, just like in non-revaluation years. No one's tax dollars will be used to subsidize someone else's tax bill, as happens after every revaluation under the current system.