QUESTIONS  

The following commonly asked questions and their answers provide an overview of the Assessor's responsibilities and the basis of them.  

One very important fact should be kept in mind - The Assessor performs the function of an appraiser in placing a dollar value on your home or other property. The Assessor does not establish the dollar amount of taxes required nor does the Assessor bill or collect the taxes. The taxpayers, state limitations, and assessed value determine the tax rate for each district. The County Treasurer's Office bills and collects the required tax.  

WHAT KINDS OF PROPERTY ARE TAXABLE?  

Under Washington state law, two types of property can be assessed and taxed. 

One type is real property (real estate), which is land, improvements attached to the land (buildings, manufactured homes, etc.) and improvements to the land (driveways, utilities, etc.). 

The other type is personal property. Taxable personal property includes agricultural machinery and equipment; manufacturers', contractors' and logging machinery and equipment; office machinery and equipment; and supplies and materials which are not held for sale or do not become an ingredient or component of an article being produced for sale. Furniture and fixtures in commercial use, leased equipment, certain leasehold improvements, franchises and easements of inter-county public utilities, lessee-owned improvements on public land and commercial vessels not subject to excise tax are also assessed and taxed as personal property. 

Many types of personal property are exempt from taxation. these include livestock; inventories held solely for resale; specific intangible property such as money, bonds, stocks or share of corporations, mortgages, notes and the like; and the personal effects and household goods in actual use by their owner. 

HOW IS THE VALUE OF REAL PROPERTY DETERMINED?  

In Washington State, assessment for tax purposes means establishing the full market value of your land and the improvements thereon. This is the job of an appraiser. Appraisal methods used in Island County follow basic practices and procedures used in the appraisal profession and in Computer Aided Mass Appraisal (CAMA). Island County is an annual county. Almost 55,000 parcels of real property are appraised each year.  The only way to accomplish this task is by Computer Aided Mass Appraisal (CAMA).

Three approaches may be used to determine real property value. they are:  
Market: The market data (sales comparison) approach 
Cost: The reproduction or replacement cost new, less accrued depreciation 
Income: The income or capitalization of economic rents approach. 

All three techniques are applied, if appropriate, in appraising improved commercial and industrial properties. The market and cost approaches are the basis of appraisal of improved residential properties. The value of vacant land is most often determined using the market approach. Whenever the Assessor revalues your property, you will receive a "Valuation Change Notice" . 

HOW IS THE VALUE OF PERSONAL PROPERTY DETERMINED?  

Most personal property assessments are based on information provided by the taxpayer on personal property affidavit forms furnished by the Assessor. The affidavits are mailed to established accounts by January 1 each year, and must be returned to the Assessor by April 30. Affidavits for new business reporting for the first time may be mailed after January 1. Extensions of filing date are not granted . A tax penalty of 5% per month will be applied to affidavits received after April 30. The Assessor may waive the penalty if the late filing is due to reasonable cause. A penalty of 25% of the tax due in the following year will be applied for failure to file an affidavit.

  The Assessor uses information provided by the taxpayer to determine value, taking into consideration the age, cost, and type of property. When the affidavit is processed and the property valued and entered on the assessment roll, a Personal Property Assessment Notice is mailed to the taxpayer.

IS PROPERTY ASSESSED AT FULL VALUE?

  Yes, the State Constitution requires property to be assessed at 100% of its true and fair value. The appraisal process is the responsibility of the Assessor, who values property on a cyclical basis according to a revaluation plan filed with the State Department of Revenue. In Island County, revaluations have been done every year since 1985.

WHAT DETERMINES THE AMOUNT OF PROPERTY TAX?

The cost of state and local government determine how much property tax will be levied. These include operating costs of schools; city and county government; and other taxing districts such as county, county roads, library, hospital, fire and sewer districts. A large part of each property tax dollar goes to pay off bonds for such capital costs as school buildings and other public projects.

HOW ARE PROPERTY TAX LEVIES ESTABLISHED?

The State Constitution, statutory levy limits set by the legislature, and excess levies approved by the voters are used to calculate the total property tax levy. The tax rate on your property is the figure resulting from dividing the dollar amount required for the taxing district by the total value of property within the district, and then adding up the rates of the various districts in which your district is located. The assessed value of your property multiplied by the combined rate produces a tax amount which is your fair share of the total property tax levy in your area. The Island County Treasurer issues tax statements and taxes are paid to the Island County Treasurer's Office.

WHAT ARE THE LEGAL LIMITATIONS ON PROPERTY TAXES?

The 1% constitutional limit:  The primary limitation on property taxes was established by amendment to the Washington State Constitution in 1972.  Article 7, Section 2 of the Constitution RCW 84.52.050 limits the total regular property tax levy to a maximum of $10.00 per $1,000 of the market value of property.  Excluded from this $10 limit are levies for ports and public utility districts.

Statutory maximum rate for districts:  RCW 84.52.043 establishes maximum levy rate for the types of taxing districts (the state, counties, cities and towns, fire districts and the like).  In addition, the statute establishes a maximum aggregate rate of $5.90 per $1,000 of assessed value for counties, cities, fire districts, library districts and certain other junior taxing districts.  The state levy for support of common schools is not subject to the $5.90 limit, although it is subject to the constitutional $10 limit. The 101% limit:  In 1971, RCW Chapter 84.55 established a limitation on the increase on regular property taxes for taxing districts.  The current limitation each year for most districts is 101% of the highest, lawful levy since 1985, plus an additional amount to allow for new construction within the district.

The 101% limit applies to the total amount of revenue collected for a taxing district, not to an individual's property tax.

With majority voter approval, districts may raise the 101% limit in order to exercise more levy authority under the statutory and constitutional limits.

Excess levies:  Most districts can submit proposition for additional property tax levies to a vote of the people.  Local school districts have no regular levy authority (although they allocated funds from the statewide school levy), so they receive a substantial portion of their funding from voter-approved excess levies.  Excess levies must be authorized by a a 60% majority of the vote, and such levies are subject to any of the limitations described above.

WHAT HAPPENS IF LEVY LIMITS ARE EXCEEDED?

The regular levy for each taxing district is reviewed by county authorities for compliance with the 101% limit, and the $5.90 and the 1% limits before the levy is made. If the statutory or 101% limits are exceeded by an individual district, then their levy is reduced to a lawful amount.  The statutes establish a district hierarchy for rate reductions if the aggregate limits are exceeded, and the rates are reduced accordingly.