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Stafford assessments soar

February 22, 2006 12:50 am

News about the increasing value of Stafford County real estate might be frightening.

But the information in the 2006 tax reassessment won't be a surprise to most locals when it starts showing up in mailboxes this weekend.

The county has seen a 63 percent rise in all property values over the last two years. That does not include new construction.

Residential properties increased in value by an average of 60 percent to 70 percent. Officials did not have more precise figures.

In Spotsylvania County, home values rose an average of 50 percent for the same period. Caroline County reassessments are expected to be mailed out soon.

And county supervisors will have to decide in April whether that translates into a tax increase. But, in anticipation of future county needs and population growth, the board faces challenges.

"With a reassessment always comes the expectation that more money will be available," said Scott Mayausky, Stafford's commissioner of revenue. "They have to try to find the balance between providing the right services and setting a tax rate that is acceptable for the tax- payers in Stafford County."

Setting the rate too high could put a substantial financial burden on local residents, potentially forcing some to relocate. If the figure is too low, the county may not have enough money to continue, improve and expand services.

Mayausky said most property owners would avoid a tax increase this year if the rate drops from 97 cents to 58 cents per $100 of the assessed value.

But even an equalized rate is no guarantee against higher taxes. Because the reassessment is based on the average increase in values, a landowner whose property value rose more than the average would still see a tax increase under an equalized rate.

Supervisors have traditionally argued that the real-estate tax should stay close to the "effective rate"--the amount it would take to generate the same revenue as in previous years plus 1 percent. They set the tax rate 5 cents higher than that figure in 2004, when there was a 34 percent increase in property values.

Several board members have expressed a similar philosophy this year.

"It's just an adjustment in housing prices. People don't need to panic over that" said Supervisor Mark Dudenhefer. "I don't think we should increase the size of government just because the value of real estate has increased.

Other board members say there is not enough information about the county's needs and the status of other funding sources to consider where the rate will fall yet.

"We haven't seen the needs yet," said Jack Cavalier, vice chairman of the board. "Real-estate taxes are just one piece of the puzzle. There are too many outside issues. For us to come up with a percent at this point would be premature."

Supervisor Pete Fields said the board is hoping for some additional money from the General Assembly for a lot of county services this year. That assistance, he said, could have a large impact on whether taxes go up or down.

Mayausky said this year's increase in real-estate values is more than any other two-year cycle he can remember. In the mid-'90s, for example, reassessments yielded 2 percent to 3 percent increases.

"As early as 2000 it was almost like someone flipped a light switch and it just started escalating," he said.

He attributes much of that growth to the area's proximity to Northern Virginia, scarcity of land, job growth and a high quality of life.

Other nearby areas have seen similar trends.

"The region as a whole is growing at a tremendously rapid pace," Mayausky said. "All the counties from Northern Virginia down to the Fredericksburg region are all experiencing 20 percent plus growth in property values and have been for a number of years."

The average existing home in Stafford is now going for about $390,000. And most land, even in rural areas, is priced 93 percent higher than it was two years ago.

Residential property makes up 88 percent of the county's real estate tax base. It's contribution to the real-estate tax base has increased by 244 percent over the past five years.

Commercial real estate is 12 percent of the tax base, down from 14 percent two years ago. It's contribution to the tax base has increased by 115 percent since 2001.

That does not necessarily illustrate a weak commercial base, Mayausky said.

"There is strong commercial growth, but it is still being outpaced by strong residential growth," he said.

He noted that commercial real estate still makes up 28 percent of the county's total tax base--which includes meals and personal property taxes. Some major commercial projects that are under way, such as Celebrate Virginia North and Fritter Park, could aid the county's funding in future years.

Stafford reassesses property values every two years. Assessments are based primarily on real-estate sale prices during that time.

More than 45,000 notices will be mailed Friday. And next week the Commissioner of Revenue's Office will begin accepting appeals from those who wish to contest the assessed value of their property. Mayausky encourages people to file their appeal using a form that can be downloaded from his office's Web site.

He told supervisors last night that he would make sure anyone who requested an appeal was heard.

"Appraising property is an inexact science," he said. Sometimes there are additional factors, not taken into account, that would alter a property's value.

To reach MEGHANN COTTER: 540/374-5434
Email: mcotter@freelancestar.com