They say death and taxes are sure things — not that we’re sure to understand them.
Lewis County Assessor Dianne Dorey has spent 47 years working in the assessor’s office and even she recognizes that learning about property taxes tends to bring up more questions than answers. As for death, she’ll leave that to the coroner.
Earlier this month, around 60,000 land- and homeowners in Lewis County received notices in the mail of the new assessed value for their property. The value of their homes is one piece of the equation they’ll need for their 2023 taxes. But, according to Lewis County Manager Erik Martin, there is a commonly-circulated falsehood that the percent increase in assessed value equals a percent increase in tax rates.
“That piece of paper in the mail is not your taxes,” Martin said.
So, what are your taxes? What determines them? Where do they go? Dorey patiently did her best to answer these questions to a reporter with The Chronicle — whose degree is in communications, not math — on Tuesday evening, staying well past the time she intended to clock out for the day.
She broke it down by two players, the taxpayers and the taxing districts. In Lewis County, all property owners pay taxes to the county and the state. Beyond that, taxes depend on where the property is located.
Cities, counties and states are called “senior” taxing districts, while “junior” taxing districts vary throughout the county. Junior taxing districts are entities that provide services to residents within their borders. Those include school, fire and EMS, hospital, library, cemetery, water and sewer districts. Some residents live in areas where they pay to all those districts while others only pay to a few.
The average Lewis County resident pays into six taxing districts, Dorey said.
Because of state law passed in 2001, each of the districts, junior or senior, has a choice every year to increase their budget by 1% — meaning they’ll collect 1% more than the year prior — or to “bank” that money, thereby setting it aside for a later date. Those yearly budgets get collected by the assessor, who doles them out appropriately.
Budget is therefore the main determinant of taxes paid. Total assessed value in a community multiplied by the taxing rate equals the budget. Or another way to put it, as Dorey did, a district’s income (budget) divided by the district’s assessed value equals the tax rate.
While value increases, as it did for most property owners in Lewis County this year, budgets are only permitted to take 1% more than they did the previous year. To keep the budget where it’s meant to be, rates have to drop.
Let’s say John Propertyowner lives in One Man City (population: one) and the value on his home last year was $100,000. The city collected $1,000 at a rate of $10 for every $1,000 of John’s assessed value.
This year, One Man City decided to take its 1% budget increase and collect $1,100. His property was revaluated and its value increased by 37%, so it’s worth $137,000.
To collect the right amount after his value spike, the city has to change the rate.
Its budget, $1,100, divided by $137,000 equals .008. That means the city gets $8 on every $1,000 of assessed value on John’s property.
While John’s value went up, his tax rate went down. He paid more taxes this year though. Why? Because the city increased its budget.
In Lewis County, Dorey said the average citizen’s taxes go up by about 8% to 10% every year. Not because of value, but because budgets increase every year. Voter-approved levy increases or bond measures account for the biggest jump in taxes.
This last election, the City of Morton voted to withdraw from the Timberland Library taxing district. Now, the money that property owners would have paid to the district stays in their pocket; property owners pay less when they live in fewer districts.
“Or, (to pay less in taxes), decrease your budget,” Dorey said. “This is the thing that people forget: taxes equal services. What services do you want to give up in order to pay less in property tax? It’s roads, fire, police, cemetery, library, hospital. How much of their budget do you want them to cut?”
Typically, 90% of budgets go to staffing, she said. That means cutting a fire district’s budget, for example, usually leads to laying off firefighters.
“And if you cut firefighters, you're going to have fewer available to do EMT services, that kind of thing. If you cut roads, that means your road might not get chip sealed for another ten years,” Dorey said.
In actuality, taxes are a bit more complicated in Lewis County than they are in One Man City. In some cases, officials can vote to take more than the 1%, while plenty do not take the 1% at all. Thus, it rounds out to be a bit more than 1% average increase per every taxing district a property owner resides in: or, an average of 8-10% more per year, Dorey said.
For More Information
An upcoming edition of The Chronicle will include a story that digs deeper into the process of junior taxing districts and the services they provide, namely fire districts.
Dorey has also been invited to join the next episode of The Chronicle’s podcast, “NewsDump,” where she will address property taxes and other subjects. Episodes are posted at https://www.chronline.com/podcasts.
On the county’s website, at https://lewiscountywa.gov, under “Departments > Budget” there is a breakdown of the county’s 2023 budget. Under “Offices > Assessor > Property Tax Levy Information” there is information about the levy rates throughout Lewis County broken down by years.