The tax levy is determined by the elected politicians or in the case of the School District, by a vote by residents of the school district on the third Tuesday of May. The assessment is just a means to apportion the taxes. The tax rate is determined by taking the tax levy and dividing it by the tax base (and then multiplying by 1,000). An increase in the tax base does not correspond to an increase in the tax levy. If that was the case, my office would be glad to cut everyone’s assessment by 50%. But in the real world, the tax rate would simply double so that the taxing jurisdiction would still generate the amount of money that they need to provide the services that they elected to provide.
Another way to think of property taxes is – take your assessment and divide by the overall tax base of the district. That is then your proportionate share of those taxes. If you take this percentage and multiply by the overall tax levy, that is your tax bill. See…you don’t even need to know a tax rate to determine your tax bill. If you hear anyone talk about tax rates – you know they are trying to hide something.
Example: Traditional Approach
Assessment = $300,000
Tax Base = $7,492,901,465
Tax Rate = $14.795626
Tax Bill = $4,438.69
Another Way to Look At It
Assessment = $300,000
Tax Base = $7,492,901,465
Percent of Tax Base = 0.004004%
Tax Levy = $110,862,167
Tax Bill = $4,438.69