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The Honorable Chairman Gary Safarik <br />and Members of the County Council <br />Page 2 <br />March 1. 2005 <br />Ordinance 04 -123 provides an additional exemption of 20% of a property's assessed <br />value (to a maximum of $80,000), for properties eligible for the home exemption. <br />Ordinance 04 -121 limits the increase in the market value of properties in the homeowners <br />class to not more than 3% per tax year until the property is sold or otherwise transferred. <br />Ordinance 04 -122 reduces the current dedication period from ten years to five years and <br />reduces corresponding rollback provisions by five years. Assessed values of properties in <br />this program are "frozen" for the period of the dedication. <br />As a result, the estimated net taxable real property values in the Homeowners class is <br />expected to drop by 14.19% in FY 2005 -06. All other classes except Conservation, however, <br />will increase significantly. <br />The Council also adopted Ordinance 04 -143 that limits the assessed value of a farm dwelling <br />site (not to exceed 'A acre) at the highest commercial agriculture use value. This means that in <br />FY 2005 -06, the land under farm dwellings will be assessed at no more than $500. This will <br />benefit agricultural properties used in or dedicated to agriculture. <br />In spite of these relief measures, this budget reflects a 13.6% overall increase in estimated net <br />taxable real property, a 15.7% increase in real property tax revenue, and no changes in the tax <br />rates. The real property assessed valuations used are still preliminary figures and the values <br />certified in April may vary from those assumed here. The final budget presented to you in <br />May will be based on the final numbers. <br />ADDRESSING AREAS OF NEED <br />This budget begins the process of addressing the many areas of need within County <br />departments that resulted from years of funding restrictions. For years, departments were <br />required to try to provide the same level of services, and in some cases increased services, <br />without any budget increase even to account for inflationary increases in such fixed costs as <br />electricity and gasoline. Repairs and maintenance as well as equipment replacements are <br />years behind since these are the areas first cut in times of fiscal distress. <br />The budget instructions given to departments in September 2001 for the next year's budget <br />required funding requests (excluding straight -time wages) to be no more than that current <br />year's budget amount. To enable the County to continue to fund its budget at that level, the <br />difficult decision was made to propose an increase in real property tax rates in May 2002. <br />This tax increase only allowed the County to avoid steep cuts and possible reduction in <br />personnel. Budget instructions given in 2002 were the same as 2001. In 2003, departments <br />were finally allowed to include inflationary increases to uncontrollable cost items such as <br />electricity and fuel. In 2004, for this present budget under consideration, departments were <br />again allowed to include inflationary increases to uncontrollable cost items, and list as <br />supplemental requests other new items requested for funding. <br />Because of the improved economy and favorable future outlook, the County can now finally <br />look at improving services and doing a better job of meeting its responsibilities to the public. <br />