There are various legislative proposals during this session of the General Assembly to modify the current schedules for both comprehensive revaluations and statistical updates. However, RIPEC believes that decreasing the frequency of property revaluations could result in less equity within and among jurisdictions; reduce the accuracy and reliability of data used to calculate and distribute state aid in the future; and result in credit rating agencies having less “real time” data to use in determining the credit worthiness of Rhode Island’s 39 cities and towns.
Rhode Island’s cities and towns generated approximately $1.9 billion in property taxes in FY 2008, which approximates the estimated combined collection of the State personal income tax ($1.1 billion) and the state sales tax ($900 million). By a wide margin property tax collections represent the Ocean State’s single largest tax source. Therefore, it is critical that procedures and practices are in place so that all property taxpayers are treated in an equitable fashion.
Periodic revaluation of property is an effort to provide for fairness in the process by reflecting the current market values. Revaluations are a necessary process which addresses the reality that properties appreciate and depreciate at different rates. Changes to the revaluation schedule can have an impact on equity within and among jurisdictions; the accuracy and similarity of data used to calculate and distribute State aid; and credit rating agencies which have less “real time” data to approve the credit worthiness of Rhode Island’s 39 cities and towns.
Maintaining current values is also critical for a number of reasons. More up-to-date property values will provide state and local policymakers with current and accurate data for administering the state’s local aid programs. For example, as state officials continue to discuss changes to education aid formulas it is necessary that they have reliable data that accurately reflects the property values in each community. Furthermore, current property values can provide bond rating agencies with more accurate and timely information. Credit rating agencies use property valuation data to help evaluate a locality’s revenue base, economic condition and debt position. Bottom line, statewide revaluation requirements were enacted to have a property tax system that would result in greater equity within and among jurisdictions, and to ensure that basic property tax data used to calculate and distribute state aid are accurate and reliable.