59.57% Of City Real Estate Tax-Exempt In Latest Annual Calculation

Thomas Breen pre-pandemic file photo

City Assessor Pullen: Reporting on latest figures, preparing for reval.

Nearly 60 percent of all city real estate value — or $8.5 billion in total — remains off the tax rolls, as City Hall gears up for a twice-a-decade property revaluation.

City Acting Assessor Alex Pullen gave that update Monday night during the Board of Alders Finance Committee’s first public hearing on Mayor Justin Elicker’s two proposed Fiscal Year 2021 – 2022 (FY22) budgets. The two-and-a-half-hour virtual meeting was held online via Zoom and YouTube Live.

One proposed general fund budget, dubbed the crisis” version, comes in at a total of $589.1 million and includes a 7.75 percent tax increase and a raft of personnel and service cuts, including the closure of Westville’s library branch.

The forward together” version totals $606.2 million, with no tax increase and a $53 million combined financial boost from Yale University and the state.

Tax-Exempt Grand List Grows To $8.5B

City of New Haven data

Before members of the public got their first chance to weigh in on the two fiscal proposals and before City Budget Director Michael Gormany gave a high-level overview of each set of revenues and expenditures, Pullen brought the alders up to speed on the latest with the city’s grand list.

That’s the sum total of taxable and nontaxable real estate, motor vehicle, and personal property value in the city. The taxable grand list represents the single largest source of revenue in any given year’s city budget, as it determines how much the city can collect in local property taxes.

Pullen said that the total tax-exempt grand list — that is, real estate that New Haven city government cannot collect property taxes on — is now worth an estimated $8,507,435,687. That’s nearly 0.4 percent, or over $32.5 million, higher than last year.

In total, 59.57 percent of the city’s overall real estate value is currently nontaxable. The city saw virtually the same ratio last year, when 59.74 percent of city real estate property was tax-exempt.

Yale University owns $3.5 billion in nontaxable local property, or 40.57 percent of the tax-exempt grand list, Pullen said. Yale New Haven Hospital owns $1.2 billion, or 14.25 percent of the tax-exempt grand list. The city owns $2 billion of that tax-exempt property value, the state owns $858,000, and various other tax-exempt nonprofits own $842,000.

Zoom

Monday night’s virtual Finance Committee meeting.

Pullen said that the largest increases in tax-exempt property value last year came through improved municipal properties, like the housing authority’s redeveloped Brookside/Rockview apartments; through the expansion of charitable organizations like Mary Wade Home and Chapel Haven; and through new acquisitions by private colleges like Yale and Albertus Magnus.

Mayor Justin Elicker, the Board of Alders, and the city’s state legislative delegation have pointed time and again to the preponderance of tax-exempt property value in town as a critical driver of New Haven’s inability to collect as much revenue as it needs to run a functional, financially sustainable city government. Click here for a response from Yale’s spokesperson about the university’s current financial contributions to the city.

Net Taxable Grand List Grows By 1.33%

City of New Haven data

As for the net taxable grand list, Pullen said that the pool of taxable city real estate, personal property, and motor vehicle property grew by 1.33 percent, or $87.9 million, to an estimated total of $6,712,653,144.

The real estate portion of the net taxable grand list grew from $5.547 billion to nearly $5.597 billion.

It’s a modest increase,” Pullen said. He added that, in a non-reval year, we often do not expect growth and a lot of the time we do see decreases.” So an across-the-board increase in the value of personal property, motor vehicle property, and real estate property represents an encouraging, if modest, boost to the city’s tax rolls.

He said the biggest drivers of last year’s taxable grand list increase were properties that are participating in the city’s assessment deferral program slowly phasing in to their actual assessments, and therefore fuller tax burdens.

Pullen said that there are 133 properties currently under deferral, and assessment deferral phase-ins constituted around $42 million of the $87 million increase to this year’s taxable grand list.

He also said that the city’s top 10 taxpayers remained in the same order as they have been in the past five years. That includes United Illuminating at the top, followed by Winstanley, Yale University, Fusco, the Public Service Electric and Gas Company (PSEG), and Yale New Haven Hospital.

Pullen added that the city’s personal property grand list saw a big increase” thanks to United Illuminating acquiring more personal property.

2021 Reval In Sight

While the nontaxable-to-taxable ratio remained virtually the same as it was last year, Pullen, the city is in the early stages of its twice-a-decade citywide revaluation.

That’s when City Hall and hired consultants review the assessments of every single property in town to come up with an up-to-date estimate of how much a property is actually worth based on recent sales, income generation, and the overall condition of the property. The city then applies the same mill rate — totally $1 in taxes for every $1,000 in assessed property value — to each property to determine how much each property should yield per year in local taxes.

The last set of values come from the reval from 2016,” Pullen said. As you move further away from the reval, your values get further away from that 70 percent ratio where we’re designed to be.” New Haven assesses properties at 70 percent of their so-called appraisals, or estimated market values, to determine how much they should owe in taxes.

As of Jan. 26, Pullen said, city-hired inspectors are combing the city, gathering data on properties across New Haven for the 2021 reval. On Dec. 16, Pullen’s office sent out data mailers to all improved properties in the city.

We’re currently in the beginning stages,” he said. The reval should be complete and the updated grand list should be in place by the time taxes are due in July 2022.

In the meantime, the 2020 grand list will be used to determine tax bills in July 2021 and January 2022.

Gormany pointed out that the crisis” version of the budget would raise the city’s real estate mill rate to 47.28, or by 7.75 percent. The forward together” version would leave the mill rate as is at 43.88.

In both versions, the motor vehicle mill rate would stay at 43.88, he said, because of caps imposed by the state legislature on how much municipalities can tax motor vehicles.

If the crisis” budget is adopted, Gormany said, a homeowner whose home is valued at $200,000, for example, would see their local property taxes increase by $475. A homeowner with a home worth $350,000 would see a $833 property tax hike. And a homeowner with a home worth $500,000 would see their property taxes go up by $1,190.

The administration is definitely looking at the forward together’ budget,” Gormany told the alders on Monday. But, we wanted to be prudent and show you what would happen if the city did not get additional revenue that’s needed from the state and from Yale.”

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