By Joseph Domelowicz Jr.
The Everett City Council voted unanimously on Monday night to adopt a tax rate shift for fiscal year (FY) 2018 to tax commercial properties at a higher rate, and to also grant a 25-percent residential exemption, essentially providing a tax break to owner occupied residences within the city.
The city adopted the maximum allowable shift of 1.75, thus allowing commercial, industrial and personal (CIP) property taxes to be charged at a higher tax rate based on their value, rather than residential properties. The maximum shift of 1.75 means that residential property taxes will be charged at a rate of $13.78 per thousand dollars of valuation, while the CIP property tax rate will be $33.74 per thousand dollars of value.
Without the residential tax shift, all properties in the city would be axed at a rate of $19.28 per thousand.
Despite this, residential property owners will still likely see a small increase in their overall tax bill for fiscal year 2018, since residential property values have been rising faster than commercial property values. The average single-family home value rose by more than $39,000 in the past year from about $327,000 in FY 2017 to $326,800 in FY 2018.
Thus, the average single-family property tax bill will rise from approximately $4,144 in fiscal year 2017 to $4,503 in fiscal 2018. Two and three family homes will also see increases, as values for those properties also rose in the past year, though at a slower pace.
Commercial and industrial properties on the other hand have actually seen their values slip or rise at a much slower rate, meaning that despite the tax shift to CIP properties and the residential exemption for the first 25-percent of home values, commercial properties across the city will see a slight decrease in their overall property tax bill for this year.
According to information provided by City Auditor Eric Demas, the property tax bills for CIP properties will decrease by less than $100 per year in most classes, with warehouse/distribution properties seeing the largest decrease year over year.
The residential exemption will also only apply to about 4,094 of the city’s 8,544 residential parcels, as the exemption only applies to owner occupied parcels.
The overall tax levy for fiscal 2018, based the allowable tax value increase under proposition 2 ½ is $102,566,340.