Waterford’s New Grand List: Property Owners Pay Less, Businesses Pay More

The town has signed off on its grand list for 2012, and the bottom line is this: businesses will pay more and property owners will pay less.

At the end of February, Waterford Tax Assessor Michael Bekech signed off on the $3.18 billion 2012 grand list. That is a 14.4 percent decrease from the $3.71 billion 2011 grand list.

The reason is the town has just completed its real estate revaluation, a once-every-five-year process. The revaluation was last done in 2007, at the height of the housing bubble, where home prices were far higher than today.

Waterford's real estate assessments dropped 18.7 percent since 2007, according the new revaluation. However, since personal property and motor vehicle taxes are assessed every year, there was no such drop off, meaning they now make up a larger percentage of the grand list.

Specifically, real estate used to make up 73.7 percent of the grand list, and now it only makes up 70 percent. That means, if the town’s budget didn’t change at all for the 2013-14 fiscal year, the average property owner would pay 3.7 percent less in property taxes, Waterford Finance Director Rudie Beers said.

More specifically, the average assessed residential property value this year was $188,000, and the owner paid $3,716.76 in taxes, according to Beers. Now, under the new grand list, the average assessed residential property value is $157,500, she said.

That means that if the 2012 grand list was used to calculate the 2012-13 budget (the 2011 grand list is used), the average residential taxpayer – despite being subjected to a higher mill rate – would have paid $3,639.83 in taxes, or $76.93 less. Meanwhile, businesses, particularly Millstone Power Station, would have paid more.

Huh?

Every five years, the town does a revaluation of all the real estate in town. The 2011 grand list, which is used to compute the current 2012-13 budget, had inflated real estate values because they were based off of 2007 assessments, when the market was stronger. However, motor vehicle and personal property assessments are done every year, and therefore had a more realistic value.

Now, the 2012 grand list is complete, which will be used to compute the 2013-14 budget. With real estate values dropping and other values staying constant, the percent real estate makes up of the grand list has dropped, meaning property owners will pay less comparatively.

Conversely, businesses will pay more. No business will be hit harder than Millstone Power Station, the town’s largest taxpayer. Millstone’s two active nuclear reactors – the most valuable pieces of the power plant – are assessed annually.

How much more? The power plant used to make up 30 percent of the total grand list. Now, it makes up 34.4 percent of the grand list, meaning that they will have to pay 4.4 percent more in taxes if everything stayed the same, Beers said. However, the town is increasing its budget next year so they’ll have to pay more on top of that, she said.

Millstone has appealed is value before, resulting in a multi-year lawsuit in the early 2000s. When reached Friday, Millstone spokesman Ken Holt would not say if Dominion would appeal the value or not.

"I'm not saying we are and I'm not saying we aren't," Holt said. "We will evaluate it."

As far as taxes, if the 2012 grand list was used instead of the 2011 grand list to calculate the tax rate for this year, Waterford taxpayers would have been subjected to a 23.11 mill rate. Right now, using the 2011 grand list, which is much larger, taxpayers are subjected to a mill rate of 19.77.

Despite the increased mill rate, the actual amount of taxes property owners would pay would drop by 3.7 percent on average, Beers said. However, Waterford’s budget is expected to increase next year, and revenues could drop, so it is likely property owners will still pay more in taxes next year, she said.

Beers also stressed that the 18.7 percent drop of real estate values is an average. Real estate that held its value, like waterfront properties, likely dropped less than that while others dropped more, she said.

Real Estate Values

(total, percentage of the grand list)

$2,736,391,690;

73.7 percent

$2,225,710,785;

70 percent

Personal Property Values

(total, percentage of the grand list)

$762,006,235;

20.5 percent

$763,087,293;

24 percent

Motor Vehicle Values

(total, percentage of the grand list)

$147,249,552;

4 percent

$145,168,740;

4.6 percent