The Everett City Council met in special session on Monday night to set the tax rate for the coming year, but in doing so had several other decisions to make that affected that tax rate.
As in year’s past, the Council voted unanimously to adopt a minimum residential factor (MRF) of 1.75%, which means the larger share of the city’s tax burden will be borne by commercial, industrial and personal property (CIP) taxes, than by the residential property owners.
This allows the council to help alleviate the tax burden on homeowners and shift some of that burden to the businesses that actually make money by being located in the city.
The 1.75 MRF, means that residential properties, which make up about 64.4 percent of the property value in the city, will actually pay only about 37.8 percent of the tax levy. By contrast, commercial properties which make up 10.45 percent of the taxable property value will pay almost 18.3 percent of the levy and industrial properties which comprise 16 percent of the property value pay 28 percent of the levy.
In an attempt to limit the tax burden on residential property owners, the Council also voted unanimously to adopt a 20-percent residential tax exemption for owner occupied homes in the city.
The 20-percent tax exemption, basically amounts to a tax break for residential property owners who live in their homes, or who live in one unit of a multi-family dwelling.
According to Board of Assessors Chairman Bill Hart, the 20-percent tax exemption for 2016 means that owner occupied single-family and multi-family homes will discount their tax bill by reducing the taxable portion of their homes’ value by an amount equal to 20-percent of the average single-family home value in Everett, which for the coming year is estimated to be $65,851.
In other words, a residential property owner who lives in their home – or in one unit of a multi-family home – will have their tax assessment based on their home value minus $65,851.