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County councilors expressed surprise and dismay when realization hit that they must approve a 36 percent property tax increase that will affect residents beginning in November.
“During the annual budget cycle council can increase or decrease the rate and council did not make any change to that last budget cycle,” Chief Financial Officer Steve Lynne said. “The last formal action council took on mill levy rates was in 1992,” Lynne explained to council that New Mexico’s Department of Finance and Administration (DFA) must calculate and certify property tax rates for all taxing entities within the state by Sept. 1 of each year.
State statutes require that within five days of receipt of the order, county council must issue a written order imposing the tax at the rates certified by DFA and set the net taxable value of property allocated to the appropriate governmental units.
A copy of that order is to be delivered immediately to County Assessor JoAnn Johnson for preparation of the tax schedule before Oct. 1.
There are two primary factors contributing to the increase in taxes from 2008 to 2009. The total levied residential rate increases by 6.141 mills or 36.3 percent and the total levied non-residential rate increases by 6.668 mills or 30.7 percent.
“The majority of the increases, approximately 5.5 mills, is a result of the successful school bond election and the related property tax rate increase that will pay debt service on Los Alamos Public Schools Building Improvement G.O. Bonds,” Lynne said.
Councilors questioned whether they could do anything to stop the increase.
“Could we argue with the state not to increase this formula,” Councilor Vincent Chivarelle asked.
County Attorney Mary McInerny responded that she did not believe the state would allow council any discretion at this point.
“Our residents are facing a 36 percent increase,” Councilor Robert Gibson said. “We had the choice (to address the issue during the last budget cycle) ... we didn’t do it ... now our citizens will see it in their November bill.”
Lynne explained that council won’t be able to address the situation again until the next budget cycle adding, “Individual taxpayers should not assume that their tax bills will change by the same percentage because changes in individual property valuation are not constant and will affect individual tax bills.”
Projected total revenue from these rates is $6,569,206 based upon a 99 percent collection factor. This amount is $87,416 higher than previously projected in the county’s FY2010 for this same period.
The rates will be entered by the assessor’s office by Oct. 1 and once the schedule is delivered, county accounts receivable staff will prepare tax bills and mail them before Nov. 1.
The first installment of the bills becomes delinquent after Dec. 10 and the second installment after May 10.