Mayor John Cooper announces property tax rate cut for Nashville but you likely will pay more in property taxes.

by Rod Williams - Mayor John Cooper has been bragging that he was planning to cut tax rates, this to some praise and applause.  Don't be fooled.  Cooper is required to cut tax rates and it is very doubtful the property taxes you pay will decrease.  Here is why.

Every four years all real property must be reappraised.  However, by law the aggregate of the new values cannot result in more tax revenue for the city than before the reappraisal.  The reason for the reappraisal is "equalization."  Not all properties appreciate in value at the same rate.  Also as new properties are put on the tax role, sometimes they are put on at a higher rate than existing properties, even though they are supposed to be put on the tax roles at a value with comparable existing homes.  So over time, values get out of whack. So, the reappraisal looks at sales data anew and puts properties on the roles at what is reasonably the current value. 

Since property is appreciating, if the property tax rate stayed the same, property tax revenue would increase.  So, by law, the tax rate has to be adjusted so that the new higher appraisals do not result in more tax revenue.  The new tax rate is called "the certified tax rate,"  This rollback in the tax rate is not something Mayor Cooper has any control over.  The city is required to do it. It is dishonest of Mayor Cooper to act as if he is doing people a favor by lowering the tax rate.

 What often happens, is that administrations raise taxes in the same year as the reappraisal.  Usually this is done at the same council meeting.  The council will approve the "certified tax rate," then the next order of business may be to pass a new higher tax rate.  Since this new rate is usually lower than the old rate, politicians can still claim they voted for a lower tax rate than previously existed.  Since most people don't understand what happened, when they get their tax bill, they blame the higher taxes they must pay on the reappraisal rather than the mayor and council for increasing their taxes.

When the city adopts the "certified tax rate," and assuming then that they do not pass a higher tax rate than that, some people's taxes will go down and some will go up and some will stay about the same.  Generally, if your property appreciated more than the average appreciation; your taxes will go up.  If your property appreciated less than the average; they go down.

Don't be fooled.  Cutting the tax rate as required by law is not a tax cut. 

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