By now, most Harvey County residents will have received a 2013 "real estate change of value" notice in their mailbox. What most people want to know is if their taxes will be going up — and, if so, by how much — but there's more of a story behind these notices than people may realize.
First, Harvey County appraiser Craig Clough wants people not to panic, because the notice is not an actual tax statement. It's simply an indication of the change in your property's value.
Although every year there's a mixture of increases and decreases, as a whole, most residential properties went up in value this year, Clough said, with a typical 2 to 3 percent increase. He said home sales are up, which is an encouraging sign, and demand remains strong for rural residential property.
Residential property is appraised every year, but the county only conducts an on-site inspection once every six years. According to regulations, taxes are based on the value of the property as of Jan. 1 each year.
Unfortunately, this can mean that if your house burns down after the first of the year, you'll still receive a tax bill for the full value, Clough said. Conversely, if a lot is vacant at the first of the year but a house is constructed on that lot later in the year, the property still will be treated as a vacant lot in terms of taxable value.
"What was there Jan. 1, that's what they're going to pay taxes on," Clough said.
You may hear the terms "assessed value" and "appraised value" used interchangeably, but they actually mean very different things, Clough said.
The assessed value is used by the county, cities and other entities to determine the taxes you pay. Appraised value is essentially the same as market value.
In terms of state values, Harvey County makes up a relatively small slice of the pie of residential and commercial property values. Combined, Johnson and Sedgwick counties make up about half of the residential and commercial property values in the state, with the other counties splitting the remaining 50 percent.
The county appraiser's office does not set the value for agricultural use properties — that's done by the Kansas Department of Revenue. This year's agricultural values also are a mix of increases and decreases, depending on the soil type and how the land is used (pasture or cultivated and irrigated or non-irrigated).
Harvey County's predominate agricultural land type is "dry land," such as cultivated land used for growing wheat or soybeans. About 70 percent of the agriculture land in Harvey County is this type, with native grass making up 16 percent, irritated land (used for crops that require a large amount of water, such as corn) at 10 percent, and tame grass (such as brome) at 2 percent.
As a whole, Harvey County agricultural land values rose about 1.9 percent. Although nearby counties Reno and Sedgwick actually saw decreases in value (0.9 percent and 2.6 percent, respectively), Harvey County's increase was actually one of the lower increases across the state. Butler County saw an increase of 15.7 percent, and Cowley County saw an increase of 16.6 percent.
"Each county's looked at on its own," Clough said.
Clough said a fact people may not realize is that agricultural land use value is not necessarily "market value" — rather, it's based on "productive potential" attributed to the natural capabilities of the land and can be somewhat political.
Agricultural land's assessed value and the amount of tax dollars generated has remained fairly flat since 1996, despite increases in agricultural market value. By contrast, residential property assessed values and tax dollars generated has steadily risen since 1996.
"There are things that the legislature has passed that are constraining some of the things that are happening in the market," Clough said.