WHY IS IT REQUIRED
Reassessment is the reappraisal of existing real property and must be conducted every four (4) years by law. Paragraph (F) of La. Const. Art. 7, Section 18 provides all property subject to taxation shall be reappraised and valued at intervals of not more than four years. (See La. Const. Art. 7 §18) In addition, La. R.S. 47:1837 also requires the assessed values to be within 10% of fair market value. To accomplish this task, our office utilizes the most modern mass appraisal methods and conduct ratio studies to determine if the assessed value has fallen below 90% because of increases in market value of real estate. Any property below the required level should anticipate an increase in value because of the reappraisal.
WHAT IS NOT AFFECTED
Reassessment does not include new construction and personal property, which is inventory, furniture and fixtures, and machinery and equipment. Personal property is reported and assessed annually. Also, bond millage rates are not affected by reassessment.
MILLAGE RATES
The millage rate is the basis for the budget needed to provide for services such as schools, drainage, law enforcement, etc. Millage rates are simply those rates, which will provide funds to pay for those services. Either by a majority vote of the citizens of Ascension Parish or by law, a taxing body has a maximum millage rate that can be levied as an ad valorem property tax. The taxing body is not required to levy the maximum millage rate and can levy any rate from zero to the maximum allowed rate. Once a taxing body adopts a millage rate for the year, the Louisiana Legislative Auditor must approve the millage rate. Once all millage rates are approved, the Louisiana Legislative Auditor will provide the Assessor a letter of approval, which must be submitted to the Louisiana Tax Commission in order to certify the annual assessment roll.
ROLL BACK VERSUS ROLL FORWARD
Before reassessment even takes place, the Assessor is committed to adopt the adjusted millage rate from reassessment, i.e., the “roll back” millage rate.
Once reassessment is complete, the Assessor is required to recalculate the assessment roll and utilize the reassessment numbers in the Louisiana Legislative Auditor’s system to determine the adjusted millage rate for each taxing body. If there was an increase in value for the taxing body, then the millage rate decreases. If there was a decrease in value, then the millage rate increases. The reason this occurs is to allow each taxing body to go through reassessment and maintain the same ad valorem property tax revenue as the prior year. This is a budget-based system as the intention of Louisiana law is to allow reassessment to occur without causing a tax increase on the taxpayers but maintaining a budget the taxpayers approved by a majority vote. The Assessor recommends all taxing bodies to adopt the adjusted millage rate from reassessment. By not “rolling forward,” all taxing bodies will still receive the normal increase from new construction and increases from personal property that comes from the industry and businesses.
At reassessment all taxing bodies have the option to “roll forward” and adopt the maximum millage rate originally approved. By doing such, the taxing body is now using a rate driven system in order to capture an increase in ad valorem property tax revenue from reassessment. The result is a tax increase on all taxpayers whose property was reappraised from reassessment. The Assessor does not recommend any taxing body to roll forward as this will further burden current taxpayers in Ascension Parish. By “rolling forward,” any taxing body will not only receive the normal increase from new construction and personal property but also the increase from reassessment. In essence, a taxing body is able to maximize property tax revenue from reassessment.