BY MARK J. CRAWFORD
Bradford County has just approved an ordinance to further the process of imposing a special assessment to fund its fire department.
Non-ad valorem special assessments are used by counties to fund specific services and infrastructure improvements. They differ from traditional property taxes. Here, we address some of the most frequently asked questions about non-ad valorem special assessments to help you understand what they are and how they might affect you.
What are non-ad valorem special assessments?
Non-ad valorem special assessments are charges levied by local governments for specific services or improvements that benefit a particular property or group of properties. Unlike ad valorem taxes, which are based on the value of the property, these assessments are typically based on the benefit received by the property from the service or improvement.
That is not the only methodology, but it is the most frequently employed.
How are these assessments determined?
The amount of a non-ad valorem special assessment is determined by the cost of the service or improvement and how it benefits the property. For example, if a county installs a new sewer system in a neighborhood, the cost of the project might be divided among the properties that directly benefit from the new system. The assessment could be based on factors such as the size of the property, the frontage of the property along the improvement, or a flat rate per property.
Bradford’s assessment study looked where calls for service were coming from — primarily residential dwellings. Therefore, those dwelling units share most of the cost burden. Nonresidential buildings — primarily commercial structures — were assessed based on size (square footage). Nonagricultural vacant property would pay a flat fee.
Some have questioned the methodology and suggested evaluating all assessments by the size of the dwelling unit. That way, those with larger and generally more valuable property would pay more than owners of smaller and generally less valuable properties.
What types of services or improvements might be funded?
Non-ad valorem special assessments can be used to fund a variety of services and infrastructure projects. Common examples include:
—road improvements and maintenance.
—stormwater management systems.
—fire protection services.
—street lighting.
—sewer and water systems.
—solid waste collection and disposal.
Bradford only has one special assessment in place, and that is for solid waste collection and disposal.
How are property owners notified?
Property owners are typically notified of non-ad valorem special assessments through their annual property tax bill. The assessment will be listed separately from ad valorem taxes, allowing property owners to see the specific charge for the special service or improvement.
Additionally, prior to finalization of a new assessment for fire rescue services, a public will take place, and notices will be sent to property owners informing them of the date and time.
Who is exempt?
Government and agricultural properties are exempt, with the exception being housing units on land zoned for agricultures. Property owners would pay the assessment for those buildings.
The commission could choose to exempt other properties as well, including those owned by faith-based and other nonprofit organizations. It could also create exemptions for seniors, veterans, or low-income residents.
How much is the fee?
This is to be determined by how much of the fire department cost the commission chooses to recover from the special assessment. The consultant’s study placed the 100% recovery at more than $300 per dwelling unit and 20 cents per square foot for nonresidential buildings.
Discussion thus far points to the commission choosing an assessment amount below the maximum amount determined by the study.
Can property owners challenge an assessment?
Property owners have the right to challenge a non-ad valorem special assessment if they believe it is unfair or incorrect. The process was not outlined in the recently adopted ordinance.
This process usually involves submitting a written appeal to the local government or attending a public hearing to present their case.
The commission has until mid-September to finalize the details and hold a public hearing to get the new special assessment on this year’s tax bill.
Notices mailed to property owners should include contact information for those with additional questions prior to the public hearing.
