From David McAuley. Email him at david[AT]borderstan.com.
An attempt to slow down the rise of DC home property assessments took a step forward on Monday, March 11. The DC Council’s Committee on Finance and Revenue heard testimony about the possible effects of new law which caps yearly increases of a property’s tax assessment at five percent.
The current cap is 10 percent. DC Council Bill 20-0022 would also eliminate the current requirement that a property’s assessment be at least 40 percent of its market value.
An assessment is defined as “[t]he value assigned to your home by a government tax assessor to determine property tax payments.”
History of the Bill
Committee on Finance and Revenue Chair, Jack Evans (D-Ward 2), opened the meeting by recapping the bill’s history. In recent years, assessed values of many district properties have increased by 25 to 50 percent, Evans said. In response, laws were passed to limit the maximum possible increase in a property’s assessed value.
The first law limited assessment increases to 25 percent yearly. Then successive laws limited assessment increases to 12 percent, and then to 10 percent. Still, Evans said, people testified last year that they can no longer afford to pay taxes on a yearly 10 percent increased assessment.
“There seems to be widespread support on the council” for the measure, Evans said. He added, however, that Council Chairman Phil Mendelson does not support the bill. Speaking after Evans, Councilmember David Grosso (I-At Large) called the bill “an important one.”
Impact on City Revenue
The only witness testifying about Bill 20-0022 was Stephen M. Cordi, Deputy Chief Financial Officer at the DC Office of Tax and Revenue. Cordi testified that the changes were “straight forward” and there would be “no significant problem with implementation.” Cordi said that, without the legislation, the assessments of over half the properties in DC would go up over 5 percent.
When pressed for a ballpark estimate of the possible annual loss of revenue to the city, Cordi speculated that the figure might be around $10 million, but emphasized that he was not sure.
The bill will move into final committee markup in four to eight weeks, after which it must be approved by the full council and the mayor, and reviewed by Congress.
At the same meeting, the council heard testimony on bills to grant property tax relief to certain individual organizations. Councilmember Jim Graham (D-Ward 1) joined the meeting to champion relief for two projects in his district, the low-income Jubilee Housing Residential Rental Project and the Gala Hispanic Theater.
Representatives from The Washington Latin School and the Basilica of the National Shrine of the Immaculate Conception also testified in favor of their requests for property tax relief.