Property Tax Overview Seminar

Transcription

1 Property Tax Overview Seminar February 23, 2017 MELG Building, Lansing/Webinar 1 Technical Questions? Click on link to check your system Contact Tech Support , option #2 No speakers? Use telephone for audio call , passcode # 2 1

2 Overview of Blackboard Collaborate Top Toolbar Whiteboard Screens Participant Window Whiteboard Tools Chat Room Audio Controls (mic/speaker level) 3 Speakers Phil Boone Michigan Department of Education Bob Dwan Michigan School Business Officials Howard Heideman Michigan Department of Treasury Andrew Lockwood Michigan Department of Treasury Sharon Raschke Dexter Community Schools 4 2

3 Agenda 8:45 am Blackboard Collaborate Overview Debbie Kopkau, MSBO 8:50 School Property Taxes Overview Robert Dwan, MSBO 9:15 Terminology, Ad Valorem Property Tax Millage Levies, K12 and ISD Howard Heideman and Andrew Lockwood, Michigan Department of Treasury 10:15 Break 10:30 Millage Rates, Millage Reduction Fractions, and Tax Rate Requests Howard Heideman and Andrew Lockwood, Michigan Department of Treasury 11:15 L-4029 Sharon Raschke, Dexter Community Schools 12:00 pm Lunch 5 Agenda (Cont) 12:45 How Property Taxes Fit into State Aid Phil Boone, Michigan Department of Education 1:40 Personal Property Tax Reform, Specific Tax Programs, Renaissance Zones, Tax Increment Financing and Board of Review Howard Heideman and Andrew Lockwood, Michigan Department of Treasury 2:25 Break 2:40 County Settlement & Reconciliation of Property Tax Receivable Sharon Raschke, Dexter Community Schools 3:45 Current Topics, Michigan State Tax Commission, Other Issues, Wrap-Up Andrew Lockwood, Michigan Department of Treasury and Robert Dwan, MSBO 4:00 Adjourn 6 3

4 Property Tax Overview School Property Tax Overview Presenter: Robert Dwan, MSBO 7 Property Tax Process A S S E S S M E N T Township & City Assessors Taxable Value Information (DS-4410) County Equalization Director Tax Increment Financing Authorities Updated in May and at least annually thereafter 8 4

5 Property Tax Process A S S E S S M E N T County Equalization Director Taxable Value Information (DS-4410) School District Consolidates information for each school district Submitted online by County Treasurer to MDE 9 Property Tax Process T A X L E V Y School District Tax Levy (Form L-4029) Townships & Cities School District prepares L-4029 for each township/city Board approves after Truth In Taxation 10 5

6 Property Tax Flowchart T A X B I L L I N Townships / Cities Property Tax Bills Property Owners G 11 Property Tax Flowchart C O L L E C T I O N NO Settlement Process with the County Property Owners Pay Bill? (by Feb 28) YES Check Township / City Treasurer 12 6

7 Property Tax Flowchart C O L L E C T I O N Tax Breakdown Township / City Treasurer School District Check 13 Property Tax Flowchart C O L L E C T I O N Property Tax Receivables Worksheet School District Deposits Check in Bank 14 7

8 Property Tax Process S E T T L E M E N T Township & City Treasurer Settlement County Townships & Cities verify to the County parcel by parcel Tax collections Taxes receivable As of March 1 15 Property Tax Process D E L I N Q U E N T County Treasurer Tax Breakdown School District Check C O L L E C T I O N 16 8

9 Property Tax Flowchart County DELINQUENT PAYOFF Delinquent Personal Property Taxes Delinquent Real Property Taxes Check (Issues debt until collected) No Action School District Township/City collects delinquent personal property taxes County collects delinquent real property taxes (bills back if uncollectible) 17 Property Tax Process D E L I N Q U E N T School District Property Tax Receivables Worksheet Used to calculate taxes receivable Deposits Check in Bank P A Y O F F 18 9

10 School Aid Fund Funding

11 Glossary of Terms 21 Property Tax Overview Terminology Presenters: Howard Heideman & Andrew Lockwood Michigan Department of Treasury 22 11

12 Terminology: Real & Personal Property Real Property is land plus buildings and fixtures on the land. Personal Property is machinery, tools, computers, furniture or generally property not permanently affixed to a structure. Household personal property is not subject to the ad valorem property tax 23 Terminology: Principal Residence (Homestead) Property Principal residence property is property used as a property owner s principal residence or qualified agricultural property or qualified forest property. Principal residence property is not subject to the local school operating millage. See MCL 211.7dd 24 12

13 Terminology: Non-Principal Residence (Nonhomestead) Property Non-principal residence property is considered to be second homes, business property, and rental housing. Non-principal residence property is subject to the local school operating millage, except for industrial personal property that is exempt and except for commercial personal property that is exempt from the first 12 mills. 25 Terminology: Real Property Classifications Residential Agricultural Commercial Industrial Timber-Cutover Developmental See MCL c for in depth descriptions

14 Terminology: Personal Property Classifications Commercial Industrial Utility See MCL c for in depth descriptions. 27 Terminology: State Equalized Valuation DETERMINATION OF STATE EQUALIZED VALUATION TRUE CASH VALUE = Market Value ASSESSED VALUE = 50% of True Cash Value SEV = ASSESSED VALUE times SEV FACTOR 28 14

15 Terminology: Capped Valuation DETERMINATION OF CAPPED VALUATION MCL a(2)(a) CAPPED = [(Prior Year Taxable Value minus VALUE LOSSES ) times the lesser of 5% or the Inflation Rate] plus ADDITIONS Inflation Rate for use in 2017 = This rate is used for both capped value calculations and Headlee MRF s 29 Terminology: Taxable Value DETERMINATION OF TAXABLE VALUE MCL a(2) Sec 27a(2): for taxes levied in 1995 and for each year after, the taxable value of each parcel of property is the lesser of the following: a) The property s calculated capped value or b) The property s current state equalized valuation

16 SEV and Taxable Value Gap $500 State Equalized Value $396.7 billions of dollars $400 $300 $200 Taxable Value $327.4 $ Source: State Tax Commission SEV and Taxable Value by Classification 2016 Classification 2016 SEV Taxable Value Agricultural Real $22,795,411,527 $10,479,877,007 Commercial Real $53,870,354,704 $46,766,419,902 Industrial Real $16,849,199,209 $15,362,578,335 Residential Real $274,930,187,551 $226,802,770,667 Timber Cutover Real $238,999,493 $114,315,228 Developmental Real $134,757,533 $71,775,693 Personal Property $27,898,913,829 $27,808,021,575 Total $396,717,823,846 $327,405,758,407 Source: State Tax Commission

17 Property Tax Overview Ad Valorem Property Tax Millage Levies, K12 Presenters: Howard Heideman & Andrew Lockwood Michigan Department of Treasury 33 Ad Valorem Property Tax Millage Levies K General Operating Levy 2. Hold Harmless Levy 3. Building & Site Sinking Fund Levy 4. Debt Levy 5. Recreational Levy 34 17

18 Ad Valorem Property Tax Millage Levies, K-12 Millage General Operating Taxable Value Base Non-Homestead & Non-Qualified Agricultural/Forest Property Headlee YES Truth in Tax YES General Operating Levy cannot exceed 18 mills or 1993 levy, whichever is less. 35 Ad Valorem Property Tax Millage Levies, K-12 Industrial Personal Property Beginning in 2008, industrial personal property is exempt from the State Education Tax and 18 mill local school operating tax. Prior to FY12, School Aid Fund revenues were reimbursed through the Michigan Business Tax

19 Ad Valorem Property Tax Millage Levies, K-12 Commercial Personal Property Also beginning in 2008, commercial personal property is exempt from 12 mills of the local school operating tax. Prior to FY12, School Aid Fund revenues were reimbursed through the Michigan Business Tax. 37 Ad Valorem Property Tax Millage Levies, K-12 Millage Supplemental Hold Harmless Taxable Value Base PRE and Qual. Ag./Forest in the local school district Truth Headlee in Tax YES YES Lesser of Annual School Code Limit Millage and the 1994 Certified Millage, as permanently reduced, times the current year millage reduction fraction for all property. (Letter ) 38 19

20 Exemption & Specific Taxation Programs Hold Harmless School Districts Because industrial and commercial personal property are treated like PRE and Ag property, hold harmless millage rates are levied on industrial and commercial personal property. Commercial personal property is only exempt from 12 school operating mills. It is only subjected to the first 12 hold harmless mills. 39 Hold-Harmless Mills Section 1211 of school code, MCL (3): Hold-Harmless Districts must reduce mills to limit increase in combined state and local revenue per pupil to lesser of: $ increase in foundation allowance % increase in general price level 40 20

21 Hold-Harmless Mills When foundation allowance increases by more than inflation, hold-harmless districts must reduce their millage rate to limit state/local increase to inflation. To allow hold-harmless districts to receive full dollar increase in foundation allowance, their foundation increases were limited to inflation. As of today, Sec.20j. payments are no longer being made. 41 Ad Valorem Property Tax Millage Levies, K-12 Millage Sinking Fund Taxable Value Base All properties within the local school district Headlee Yes Truth in Tax No See Attorney General Opinion

22 Ad Valorem Property Tax Millage Levies, K-12 Millage Debt Taxable Value Base All properties within the local school district Headlee No Truth in Tax No 43 Ad Valorem Property Tax Millage Levies, K-12 Millage Recreational Taxable Value Base All properties within the local school district Headlee Yes Truth in Tax Yes 44 22

23 Property Tax Overview Ad Valorem Property Tax Millage Levies, ISD Presenters: Howard Heideman & Andrew Lockwood Michigan Department of Treasury 45 Ad Valorem Property Tax Millage Levies, ISD 1. Allocated Operating Levy 2. Special Education 3. Vocational Education 4. Enhancement 46 23

24 Ad Valorem Property Tax Millage Levies, ISD ISD Millage Allocated Operating Taxable Value Base All properties within the intermediate school district Truth Maximum Headlee in Tax 150% of what Yes Yes was authorized in 1993 Allocated through voter-approved fixed allocation or by county allocation board. 47 Ad Valorem Property Tax Millage Levies, ISD ISD Millage Special Education Taxable Value Base All properties within the intermediate school district Truth Maximum Headlee in Tax 175% of what Yes Yes was authorized in

25 Ad Valorem Property Tax Millage Levies, ISD ISD Millage Vocational Education Taxable Value Base All properties within the intermediate school district Truth Maximum Headlee in Tax 150% of what was Yes Yes authorized in If not authorized, 1 mill is the limit 49 Ad Valorem Property Tax Millage Levies, ISD ISD Millage Enhancement Taxable Value Base All properties within the intermediate school district Truth Maximum Headlee in Tax Not to exceed Yes Yes 3 mills 50 25

26 Ad Valorem Property Tax Millage Levies NOT SUBJECT TO HEADLEE NOT SUBJECT TO TRUTH IN TAXATION STATE EDUCATION TAX NOT TO BE REPORTED BY THE LOCAL SCHOOL DISTRICT or ISD ON THE L TAX RATE REQUEST 51 Break 52 26

27 Property Tax Overview Millage Rates/Millage Reduction Fractions Presenters: Howard Heideman & Andrew Lockwood Michigan Department of Treasury 53 Terminology: Millage Rate(s) BRIEFLY EXPLAIN THE DIFFERENCE BETWEEN A. AUTHORIZED OPERATING MILLAGE RATE B. PERMANENTLY REDUCED OPERATING MILLAGE RATE C. MAXIMUM ALLOWABLE OPERATING MILLAGE RATE 54 27

28 Terminology: Millage Rate(s) AUTHORIZED MILLAGE RATE: Millage rate or levy authorized by specific statute, charter or vote of the electorate. 55 Terminology: Millage Rate(s) PERMANENTLY REDUCED MILLAGE RATE: Beginning in 1994, if an authorized millage was subject to a Headlee rollback, the resulting reduced millage was carried forward to serve as the beginning levy for the following year s calculation

29 Terminology: Millage Rate(s) MAXIMUM ALLOWABLE MILLAGE RATE: Prior year permanently reduced millage rate as factored by the applicable current year millage reduction fractions for Headlee limitation, Truth in Equalization* and/or Truth in Assessing*. *K-12 & ISD operating levies are not subject to Truth in Equalization or Truth in Assessing Rollbacks 57 Millage Reduction Fractions Headlee Millage Reduction Fraction MCL d Inflation MRF = (Prior Year Taxable Value - LOSSES ) X Rate (Current Year Taxable Value - ADDITIONS Inflation rate to be utilized for calculation of 2016 MRF is 0.3% (expressed as 1.003) 58 29

30 Millage Reduction Fractions Headlee Millage Reduction Fraction MCL d For K-12 General Operating, the Headlee MRF is calculated using 100% non-homestead & 100% nonqualified agricultural (Real & Utility Personal) properties located within the local school district only. Effective date set by local assessing officer. For: K-12 Hold Harmless, Sinking Fund, and Recreation; & ISD levies, the Headlee MRF is calculated using ALL properties (Real & Personal) located within the specific district. 59 Millage Reduction Fractions Base Tax Rate Fraction - Truth in Taxation MCL e BTRF = (Prior Year Taxable - LOSSES ) (Current Year Taxable - ADDITIONS ) 60 30

31 Millage Reduction Fractions CALCULATION OF BASE TAX RATE BTR = Prior Year Operating Levy times BTRF Note: A tax authority may forego the requirements of Truth in Taxation if it meets the optional requirements of Truth in Budgeting 61 Millage Reduction Fractions LOSSES MCL d(1)(h) Property Destroyed Property Removed Exempt Property Decrease in Occupancy Environmental Contamination LOSSES NOT: Platting, Splits, Combinations, Zoning Changes 62 31

32 Millage Reduction Fractions ADDITIONS MCL d(1)(b) Omitted Real Property Omitted Personal Property New Construction Previously Exempt Property Replacement Construction Remediation of Environmental Contamination Increase in Occupancy (Ruled unconstitutional, WpW) Public Services (Ruled unconstitutional, Toll Northville) 63 Millage Reduction Fractions ADDITIONS NOT: Platting, Splits, Combinations Zoning Changes Transfers of Ownership 64 32

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44 Property Tax L SCHOOL DISTRICTS Michigan Department of Treasury 612 (Rev. 3-16) (Page 2 OF 3) MUSKEGON COUNTY EQUALIZATION DEPARTMENT All Properties L-4028 IC 2016 Millage Reduction Fraction Computation (HEADLEE) (T in A) (T in T) Not On L-4029 L-4029 Column (6) L-4029 Column (8) 2015 Taxable 2016 Taxable Taxable Taxable Millage Truth in Base Tax Code Taxing Value Value Value of Value of Reduction Assess/Equal Rate Number Jurisdiction (1) As of 5/25/15 As of 5/23/16 Losses Additions Fraction (2) Fraction Fraction SCHOOL DISTRICTS Kent City Public 33,613,963 33,547, , ,400 IC NA IC Muskegon Public 509,595, ,878,698 13,665,917 20,874, NA Less Renaissance Zone (2,858,464) (2,219,936) (790,800) (170,500) Non Renaissance Zone 506,736, ,658,762 12,875,117 20,704, NA Muskegon Heights Public 101,543,583 92,260,705 7,593,832 2,605, NA Less Renaissance Zone (408,699) ,175 Non Renaissance Zone 101,134,884 92,260,705 7,593,832 3,014, NA Mona Shores Public 810,045, ,428,691 18,686,876 17,284, NA Less Renaissance Zone (849,800) (746,277) (76,600) (300) Non Renaissance Zone 809,195, ,682,414 18,610,276 17,284, NA Oakridge Public 173,123, ,199,998 10,537,769 4,334, NA Less Renaissance Zone (243,200) (237,451) 0 0 Non Renaissance Zone 172,880, ,962,547 10,537,769 4,334, NA Fruitport Public 566,237, ,033,043 4,785,188 14,767, NA Less Renaissance Zone (280,400) (158,300) (118,300) 0 Non Renaissance Zone 565,957, ,874,743 4,666,888 14,767, NA Holton Public 147,273, ,131,563 1,109,459 2,093, NA Montague Public 345,703, ,481,672 18,269,524 5,795, NA

45 SCHOOL DISTRICTS Michigan Department of Treasury 612 (Rev. 3-16) (Page 2 OF 3) MUSKEGON COUNTY EQUALIZATION DEPARTMENT All Properties L-4028 IC 2016 Millage Reduction Fraction Computation (HEADLEE) (T in A) (T in T) Not On L-4029 L-4029 Column (6) L-4029 Column (8) 2015 Taxable 2016 Taxable Taxable Taxable Millage Truth in Base Tax Code Taxing Value Value Value of Value of Reduction Assess/Equal Rate Number Jurisdiction (1) As of 5/25/15 As of 5/23/16 Losses Additions Fraction (2) Fraction Fraction SCHOOL DISTRICTS Orchard View Public 307,875, ,832,029 27,524,981 11,695, NA Less Renaissance Zone (1,201,491) (842,894) (319,000) 0 Non Renaissance Zone 306,673, ,989,135 27,205,981 11,695, NA Ravenna Public 171,568, ,536,491 5,797,059 3,951, NA Less Renaissance Zone (860,106) (972,753) 0 (173,600) Non Renaissance Zone 170,708, ,563,738 5,797,059 3,778, NA Reeths-Puffer Public 598,563, ,142,441 17,764,346 9,752, NA Less Renaissance Zone (3,425,734) (1,809,980) (1,509,400) 0 Non Renaissance Zone 595,138, ,332,461 16,254,946 9,752, NA North Muskegon Public 142,701, ,170,994 2,080,931 1,420, NA Whitehall Public 474,734, ,084,285 33,070,524 10,493, NA Less Renaissance Zone (3,037,400) (1,512,886) (1,557,200) (119,800) Non Renaissance Zone 471,697, ,571,399 31,513,324 10,374, NA Fremont Public 6,471,395 6,591,239 38, ,644 IC NA IC Grant Public 35,646,817 35,982, , ,900 IC NA IC Grand Haven Public 131,896, ,177,977 6,778,346 5,696,500 IC NA IC Less Renaissance Zone (1,407,100) (1,423,400) (1,700) (62,200) Non Renaissance Zone 130,489, ,754,577 6,776,646 5,634,300 IC NA IC Coopersville Public 13,532,334 14,237, , ,300 IC NA IC 89 Michigan Department of Treasury 612 (Rev. 3-16) (Page 2 OF 3) MUSKEGON COUNTY EQUALIZATION DEPARTMENT All Properties L-4028 IC 2016 Millage Reduction Fraction Computation (HEADLEE) (T in A) (T in T) Not On L-4029 L-4029 Column (6) L-4029 Column (8) 2015 Taxable 2016 Taxable Taxable Taxable Millage Truth in Base Tax Code Taxing Value Value Value of Value of Reduction Assess/Equal Rate Number Jurisdiction (1) As of 5/25/15 As of 5/23/16 Losses Additions Fraction (2) Fraction Fraction INTERMEDIIATE SCHOOLS Kent County 33,613,963 33,547, , ,400 IC NA IC Muskegon County 4,348,967,310 4,281,180, ,886, ,069, NA Less Renaissance Zone (13,165,294) (8,500,477) (4,371,300) (55,025) Non Renaissance Zone 4,335,802,016 4,272,680, ,515, ,014, NA Newaygo County 42,118,212 42,573, , ,544 IC NA IC Ottawa County 145,429, ,415,630 6,929,651 6,083,800 IC NA IC Less Renaissance Zone (1,407,100) (1,423,400) (1,700) (62,200) Non Renaissance Zone 144,022, ,992,230 6,927,951 6,021,600 IC NA IC COMMUNITY COLLEGE Muskegon Community 4,344,410,177 4,273,173, ,021, ,613, NA Less Renaissance Zone (14,572,394) (9,923,877) (4,373,000) (117,225) Non Renaissance Zone 4,329,837,783 4,263,249, ,648, ,496, NA LIBRARIES Hackley Public Library 604,479, ,808,361 38,017,804 26,180, NA Less Renaissance Zone (3,830,555) (2,844,230) (1,106,000) (170,500) Non Renaissance Zone 600,648, ,964,131 36,911,804 26,010, NA Muskegon Area District 3,264,049,126 2,769,629, ,490,788 58,523, NA Less Renaissance Zone (7,704,439) (5,408,461) (1,871,900) 173,075 Non Renaissance Zone 3,256,344,687 2,764,221, ,618,888 58,696, NA White Lake Community 474,734, ,084,285 33,070,524 10,493, NA Less Renaissance Zone (3,037,400) (1,512,886) (1,557,200) (119,800) Non Renaissance Zone 471,697, ,571,399 31,513,324 10,374, NA

46 Michigan Department of Treasury 612 (Rev. 3-16) (Page 3 OF 3) MUSKEGON COUNTY EQUALIZATION DEPARTMENT Non-P.R.E. and Non-Qualified Agricultural Properties L-4028 IC 2016 Millage Reduction Fraction Computation (HEADLEE) (T in A) (T in T) Not On L-4029 L-4029 Column (6) L-4029 Column (8) 2015 Taxable 2016 Taxable Taxable Taxable Millage Truth in Base Tax Code Taxing Value Value Value of Value of Reduction Assess/Equal Rate Number Jurisdiction (1) As of 5/25/15 As of 5/23/16 Losses Additions Fraction (2) Fraction Fraction SCHOOL DISTRICTS Kent City Public 4,243,655 4,483,327 36, ,600 IC NA IC Muskegon Public 266,354, ,033,211 1,862,249 13,631, NA Less Renaissance Zone (1,205,599) (1,330,957) 0 (98,900) NA Non Renaissance Zone 265,149, ,702,254 1,862,249 13,532, NA Muskegon Heights Public 59,937,271 58,007, ,400 1,347, NA Less Renaissance Zone (158,699) ,175 NA Non Renaissance Zone 59,778,572 58,007, ,400 1,506, NA Mona Shores Public 243,745, ,446,555 1,030,562 6,252, NA Less Renaissance Zone (535,200) (527,277) 0 0 NA Non Renaissance Zone 243,210, ,919,278 1,030,562 6,252, NA Oakridge Public 51,508,682 51,368,812 2,161,598 1,497, NA Less Renaissance Zone (183,800) (184,351) 0 0 NA Non Renaissance Zone 51,324,882 51,184,461 2,161,598 1,497, NA Fruitport Public 165,172, ,297, ,656 5,107, NA Less Renaissance Zone (116,400) (116,300) 0 0 NA Non Renaissance Zone 165,056, ,181, ,656 5,107, NA Holton Public 40,572,307 41,617, ,130 1,067, NA Montague Public 132,139, ,015, ,357 2,512, NA Orchard View Public 123,557, ,380,381 1,914,419 5,417, NA Less Renaissance Zone (399,891) (393,694) 0 0 NA Non Renaissance Zone 123,158, ,986,687 1,914,419 5,417, NA Michigan Department of Treasury 612 (Rev. 3-16) (Page 3 OF 3) MUSKEGON COUNTY EQUALIZATION DEPARTMENT Non-P.R.E. and Non-Qualified Agricultural Properties L-4028 IC 2016 Millage Reduction Fraction Computation (HEADLEE) (T in A) (T in T) Not On L-4029 L-4029 Column (6) L-4029 Column (8) 2015 Taxable 2016 Taxable Taxable Taxable Millage Truth in Base Tax Code Taxing Value Value Value of Value of Reduction Assess/Equal Rate Number Jurisdiction (1) As of 5/25/15 As of 5/23/16 Losses Additions Fraction (2) Fraction Fraction SCHOOL DISTRICTS Ravenna Public 29,772,953 31,289, ,053 1,433, NA Less Renaissance Zone (317,706) (312,753) 0 0 NA Non Renaissance Zone 29,455,247 30,976, ,053 1,433, NA Reeths-Puffer Public 149,640, ,672,554 5,328,975 6,092, NA Less Renaissance Zone (740,834) (746,980) 0 0 NA Non Renaissance Zone 148,899, ,925,574 5,328,975 6,092, NA North Muskegon Public 33,687,652 34,214, , , NA Whitehall Public 157,139, ,156, ,084 3,497, NA Less Renaissance Zone (495,900) (617,186) 0 (119,800) NA Non Renaissance Zone 156,643, ,538, ,084 3,378, NA Fremont Public 1,852,946 1,886,667 27,700 98,900 IC NA IC Grant Public 6,353,379 6,416,613 32, ,700 IC NA IC Grand Haven Public 70,223,015 70,828, ,900 1,449,900 IC NA IC Less Renaissance Zone (864,600) (843,300) 0 0 NA Non Renaissance Zone 69,358,415 69,985, ,900 1,449,900 IC NA IC Coopersville Public 1,590,517 1,758,213 4, ,200 IC NA IC 92 46

47 Property Tax Preparation of L Obtain the L from County Equalization If you are in more than one county, you will need the L-4028 IC. Taxable Values 94 47

48 Taxable Values by Municipality 95 Taxable Values Total taxable values used for Debt, Sinking, and Special Ed Non-PRE/MBT (non-homestead) used for Operating (General Fund) Use to budget by municipality GF operating tax revenue ( xxxx) Debt tax revenue ( xxxx) Common debt fund makes splitting debt levy not necessary 96 48

49 L-4029 Tax Rate Request Use an excel version of the L-4029 Just update from year to year Calculated cells Reduce inadvertent errors 97 L-4029 Tax Rate Request Have last year s L-4029 available for reference 98 49

50 L-4029 Tax Rate Request 99 L-4029 Tax Rate Request Enter the source for each millage. This may include charter, extra-voted, debt

51 L-4029 Tax Rate Request Enter the purpose of the millage and on what properties it applies. Examples are operating-non PRE, debt-all properties, sinking-all properties, special edall properties. 101 L-4029 Tax Rate Request Record the election date and year for each millage authorized by district voter approval

52 L-4029 Tax Rate Request List the millage rate for each rate authorized by voters, charter, or debt service. This is the originally authorized rate before any millage reductions. 103 L-4029 Tax Rate Request List the millage rate for each rate authorized by voters, charter, or debt service. This is the originally authorized rate before any millage reductions. Always use four (4) decimals

53 L-4029 Tax Rate Request Look at last year s Column 7 This is the permanently reduced rate recorded in column 7 of last year s L Enter the full millage rate approved by voters if it was approved after April 30 of this year. Current year approvals are NOT subject to reduction this year. 105 L-4029 Tax Rate Request Column 6 does not exceed This prevents roll up of millage rates. Enter for any current year approved millage (after April 30). Enter for debt, as debt millage is not subject to roll back. List Millage Reduction Fraction reported by county equalization on form L-4028 (IC) for the current year Use four decimal places Operating, sinking, and special ed levies may roll back

54 L-4029 Tax Rate Request x = x = Calculation Column Multiply rate in Column 5 by the Millage Reduction Fraction in Column 6 Round DOWN to fourth decimal place because you may not levy MORE than and if it rounds up, it would be MORE than 107 L-4029 Tax Rate Request This column is always for school districts, since schools are not subject to Truth in Assessing or Equalization millage rollback fractions

55 L-4029 Tax Rate Request Calculation Column Multiply rate in Column 7 by the rollback fraction in Column 8 Since Column 8 is always for schools, Column 9 is always Column 7 for schools 109 L-4029 Tax Rate Request Calculation Column Indicate your summer requested levy in column 10 Indicate your winter requested levy in column 11 This district only levies winter taxes Operating non-pre may not exceed List debt splits if you account for debt issuance separately

56 L-4029 Tax Rate Request Record the millage expiration date This is always a 12/31 date with the year of millage expiration. 111 L-4029 Tax Rate Request Report millage levy for: Principal Residence, Qualified Ag, Qualified Forest and Industrial Personal (normally ) Commercial Personal (normally ) All Other (normally unless you have a roll back)

57 L-4029 Tax Rate Request Complete the certification section Complete the prepared by section, so county officials know who to contact with any questions. Board secretary and Board president must sign the L-4029 AFTER the levy is approved by the Board. 113 L-4029 Tax Rate Request Use an excel version of this form or a fillable PDF can be obtained from Michigan Treasury s website at Form must be completed and submitted to county equalization, county treasurers, and local municipalities on or before September 30 of each year. If you do a summer levy, the form must be submitted earlier because tax forms are generated and sent June 30. Tax Rate Requests must be approved in accordance with Truth in Taxation Hearing requirements

58 Truth in Taxation Hearing Publish notice in your publication of record ON THE ADOPTION OF THE BUDGET FOR THE FISCAL YEAR AND THE 2016 TAX RATE ON NON-HOMESTEAD PROPERTIES THAT WILL BE AT 18 MILLS AND THE 2016 DEBT LEVY ON ALL PROPERTIES THAT WILL BE AT 8.5 MILLS. THE PROPERTY TAX MILLAGE RATE PROPOSED TO BE LEVIED TO SUPPORT THE PROPOSED BUDGET WILL BE A SUBJECT OF THIS HEARING. 115 Truth in Taxation Hearing Conduct hearing at Board Meeting before the budget is adopted

59 Resolution for Tax Millage Rate Board authorizes tax levies 117 Usage of Extra non-pre

60 Property Tax Allocation Begin your new year Current Property Tax Allocation Tax Collection spreadsheet 2015 Tax Year = Fiscal Year 2016 Tax Year = Fiscal Year 119 Budget for Property Taxes From the taxable values, calculate the taxes you will collect for General Fund (non-pre), Debt Fund (all properties), Sinking Fund (all properties) ISD will have Special Ed (all properties)

61 Property Tax Hands-on Workshop Settlement Reconciliation 121 Property Taxes Collected Finalize Excel file details Each property tax receipt by municipality (i.e. township, city) County settlement collections Delinquent personal property tax from municipality

62 Taxable Values Print and Download (Excel) - Taxable Value (4410) from n.aspx (public access) 123 Taxable Values Copy and paste values into Property Tax Reconciliation Worksheet

63 Reconciliation Worksheet Modify content and formulas as needed for your particular situation and particular year (i.e. levy, sinking fund, tax captures like DDA, annexed parcels). Used to calculate expected tax collection of operating, debt, sinking fund, etc. Enter collected taxes, receivables, adjustments to 4410 needed. Tie to county settlements, L-4029, GL 125 County Settlements Tie to county settlements, L-4029, GL

64 Taxable Values Tie to General Fund GL and Debt Fund GL 127 Reconciliation Tie to State Aid Status Report for operating revenues expected If they do not match either the 4410 is not updated or the update to the 4410 has not been picked up by the State. Verify and note adjustment

65 Reconciliation Compare the L-4029 to get a sense of your expected taxable values versus final taxable values 129 County Settlements Most municipalities settle with the county by mid-may. Settlements are basis for revised DS4410 report. School district pays county for surety bonds issued for DTRF. Delinquent taxes on personal property collected by local treasurers, unless county treasurer agrees to collect

66 Calculate Your Foundation Foundation per pupil $7,693 x Number of students 3, = Foundation Total _27,310, State Source Expected Gross Foundation_ 27,310, Less Local Property Tax Revenue 4,332, Total Expected State Aid _22,978,044.65_

67 State Source Difference should be minor 133 Property Tax Hands-on Workshop Personal Property Exemption Loss

68 Personal Property Exemption The exemption of personal property was a loss for schools debt millage collection. Treasury will reimburse the loss under PA 86 of Must complete Form 5451 and submit to TreasORTAPPT@Michigan.gov due August 15, Personal Property Exemption Need REVISED L-4050 from County Equalization

69 Personal Property Exemption If you are in more than one county, make sure you have the IC version of the REVISED L-4050 from County Equalization. 137 Personal Property Exemption Complete form 5451 Personal Property Exemption Loss 2016 Debt Millgage Reimbursement Claim for School Districts & Intermediate School Districts

70 Personal Property Exemption Use Personal Property Exemption Loss 2013 TV-2016 TV Enter your debt millage levied based on year of obligation 139 Personal Property Exemption Reimbursement = 19,340,444 * mills = $164,394 Submit claim Form 5451 to TreasORTAPPT@Michigan.gov due August 15,

71 Lunch 12:00 12:45 pm