Property tax is the source of a large portion of the city's revenue. The total amount of property tax collected is a product of the tax (mill) rate and the aggregate value of all taxable property in the city. If there is a drop in the value of taxable property, then the tax rate on the remaining property must rise to maintain city revenue.
This year's Grand List has a total value of $3.74 billion. This is down by $11.3M from last year, a drop of about one third of one percent.
Showing posts with label grand list. Show all posts
Showing posts with label grand list. Show all posts
Thursday, February 2, 2012
Tuesday, February 23, 2010
Grand List: Correction
Earlier today I published the top ten grand list, with a mistake in the calculation for what the tax would be, a corrected table is below.
Property owners are charged a tax on 70% of the assessed value of their property. The "Assessment" in the table, is AFTER that 70% has already been calculated. Thus, the tax which property owners would pay (if the mill rate does not increase) is about 1/3 higher than I had in the earlier post.
The tax paid by the Kleen Energy is more complicated because of the 2003 tax deal.
| Taxpayer | Assessment | tax if NO mill rate increase | |
| 1) Aetna Life (Including lessor’s) | Insurance | $216,341,550 | $5,516,710 |
| 2) United Technologies | Manufacturing | $144,349,820 | $3,680,920 |
| 3) Connecticut Light & Power | Utility | $67,639,270 | $1,724,801 |
| 4) Middletown Power LLC | Utility | $45,332,710 | $1,155,984 |
| 5) Kleen Energy Systems LLC | Utility | $44,997,740 | It is complicated |
| 6) Northwood Apt Assoc LLC | Apartments | $23,619,040 | $602,286 |
| 7) Chestnut Hill Apt Assoc LLC | Apartments | $21,765,650 | $555,024 |
| 8) Fairfield Midtown Brook LP | Apartments | $21,609,110 | $551,032 |
| 9) Fairfield Midtown Ridge LP | Apartments | $21,337,320 | $544,102 |
| 10) New Boston Windshire | Apartments | $17,959,480 | $457,967 |
Kleen Energy and Property Tax
According to Damon Braasch, Assessor for the City, the agreement with Kleen Energy is for Payment in Lieu of Taxes (PILOT), specifically on the power plant. Other parcels of land, and a water plant, are not part of the PILOT agreement.
The assessment given above includes all of the Kleen Energy property. Braasch said that the assessed value of the plant itself (on October 1) was $40.9M, this would normally generate a tax of $1.04M. However, since the agreement calls for "the lesser of $1 million or the amount determined as if this Agreement were not in effect," the tax will be $1M. Kleen will pay a normal tax rate on the remaining $4.1M assessment, about $100,000.
Just to make things even more complicated, property owners also pay tax to one of the three fire districts. As there is no apparent agreement with the South Fire District, Kleen would pay full fire taxes on the entire assessment. A couple of years ago the South District mill rate was 3.4, this would yield about $150,000 in taxes from Kleen Energy for the South District.
Grand List Stable
Note: this article as originally posted, had incorrect values for the projected tax. I have corrected the table below, see Correction for further explanation.
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The city's grand list of October 1, 2009, rose by only 0.1% over a year earlier, to $3,506,962,608. The grand list is the sum of all taxable property in the city, largely consisting of real estate, personal property, and motor vehicles.
The 0.1% increase is less than the 0.7% increase of a year ago, reflecting a delayed effect of the recession on property values. Without any increase in the mill rate, the city would receive only $78,000 in added revenue from the 0.1% increase in property value. In June of last year, after appeals and adjustments, the grand list was reduced by approximately 0.1%, so ultimately the city may be able to count on no change at all in property tax revenue in the coming budget.
The top 10 taxpayers in the city remain Aetna, Pratt & Whitney, and CL&P; Kleen Energy is 5th. [According to the tax abatement discussed earlier, in the period between construction commencement and commercial operation, Kleen pays "the lesser of $1 million or the amount determined as if this Agreement were not in effect." If Kleen goes into commercial operation, the taxes as a percentage of its value would be dramatically lower.]
Below is the list of the top tax payers, their October 1, 2009 assessment, and the taxes they would pay in the coming fiscal year if the mill rate is not changed.
| Taxpayer | Assessment | tax if NO mill rate increase | |
| 1) Aetna Life (Including lessor’s) | Insurance | $216,341,550 | $5,516,710 |
| 2) United Technologies | Manufacturing | $144,349,820 | $3,680,920 |
| 3) Connecticut Light & Power | Utility | $67,639,270 | $1,724,801 |
| 4) Middletown Power LLC | Utility | $45,332,710 | $1,155,984 |
| 5) Kleen Energy Systems LLC | Utility | $44,997,740 | It is complicated |
| 6) Northwood Apt Assoc LLC | Apartments | $23,619,040 | $602,286 |
| 7) Chestnut Hill Apt Assoc LLC | Apartments | $21,765,650 | $555,024 |
| 8) Fairfield Midtown Brook LP | Apartments | $21,609,110 | $551,032 |
| 9) Fairfield Midtown Ridge LP | Apartments | $21,337,320 | $544,102 |
| 10) New Boston Windshire | Apartments | $17,959,480 | $457,967 |
Sunday, June 21, 2009
Grand List Takes a Hit
In a letter dated June 16 city assessor Damon Braasch has informed the mayor, the Common Council and the city's finance director that the city can count on a loss of $134,283 in anticipated revenue.
A large percentage of that, $38,053 comes from adjustments made to the grand list because of the sale of Marino Crane to Barnhart Crane and Rigging. According to Braasch's letter:
The sale occured on September 28, 2008, prior to the October 1 assessment date. As a result all 255 motor vehicles ,which had been owned by Marino and registered in the City of Middletown, were transferred to Barnhart. Barnhart has relocated 99 of these vehicles, and registered them out of state resulting in the loss of $1,492,290 in assessed value. Of that total, approximately one-half is attributable to two cranes assessed at a total of $721,000.
Other adjustments to the Grand List came from certificate of corrections to property and motor vehicles which have been issued for "invalid personal property accounts and court stipulations."
These adjustements resulted in a reduction of $2,284,687 to the Grand List.
A large percentage of that, $38,053 comes from adjustments made to the grand list because of the sale of Marino Crane to Barnhart Crane and Rigging. According to Braasch's letter:
The sale occured on September 28, 2008, prior to the October 1 assessment date. As a result all 255 motor vehicles ,which had been owned by Marino and registered in the City of Middletown, were transferred to Barnhart. Barnhart has relocated 99 of these vehicles, and registered them out of state resulting in the loss of $1,492,290 in assessed value. Of that total, approximately one-half is attributable to two cranes assessed at a total of $721,000.
Other adjustments to the Grand List came from certificate of corrections to property and motor vehicles which have been issued for "invalid personal property accounts and court stipulations."
These adjustements resulted in a reduction of $2,284,687 to the Grand List.
Monday, February 2, 2009
Councilman Bauer Concerned About Potential Drop In Future Grand List
Councilman David Bauer is worried about a financial tsunami that could be even more damaging to the city, its grand list and its tax revenue then even the current crisis portends. When Aetna leaves Middletown for good, the financial impact could be devastating, Bauer claims.
"Two years from now we'll feel an impact of a $30 million decrease in revenue over five years," Bauer said Sunday. "Nobody's talking. I challenge anyone, the chamber, city hall, anyone who has a different interpretation of these numbers, to bring them forward."
In an email to city hall staff on January 16, Bauer says:
Correct me if I am wrong, but doesn’t Aetna contribute about $ 8 Million per year in property taxes. Your suggested course of action seems tepid at best. Were we hoping that the problem might go away if we ignored it? The Common Council has a fiduciary responsibility to the City and this potential revenue shortfall eclipses any other budget issue. I am stunned and insulted that hard information concerning our #1 taxpayer has been withheld.
I recommend immediate action by the Council, the Mayor, Finance Director, PCD Director, and whatever outside expertise we need to enlist, to deal with Aetna and this impending revenue shortfall.
They mayor's administrative assistant Geen Thazhampallath replied to Bauer the same day, writing:
Councilman: We assure you nothing was withheld and that the Mayor is working the multiple facets of the issue along with the Chamber President, Finance Director and P&Z Director with the highest levels of Aetna. We'll be happy to meet with you to share any facts and data we have.
Not satisfied, Bauer points to recent information published by Moody's Rating Service which states "Management does not expect an adverse financial impact from the reduction in Aetna Life’s operations." and Standard and Poor's which reports "City officials project that the property Aetna plans to vacate will be quickly redeveloped." Moody's and S&P determine the credit rating for the city.
"I'm really concerned," Bauer said. "And any property owner in Middletown should be concerned. The first thing we need to do is have a workshop. We all have to be working with the same numbers so we can understand the potential impact."
Bauer feels that the city has not moved on the problem with appropriate haste, but that proper planning now could prevent a disaster.
"If we encourage development, it could be a half billion dollar development. It's 250 acres of prime land, with good access to I-91."
Bauer is demanding an immediate workshop.
Bauer writes in an email to the Eye:
We need to actively plan to cover this likely shortfall in revenues or we face a variety of unpleasant possibilities – dramatic cutback of services or property tax increases. We have to face these likely scenarios before we can engage our State Legislative delegation and force every Gubernatorial candidate to take a position on this issue. This situation has another bad effect on the Westfield Fire District because Aetna contributes over 20% of the revenue to the District.
"Two years from now we'll feel an impact of a $30 million decrease in revenue over five years," Bauer said Sunday. "Nobody's talking. I challenge anyone, the chamber, city hall, anyone who has a different interpretation of these numbers, to bring them forward."
In an email to city hall staff on January 16, Bauer says:
Correct me if I am wrong, but doesn’t Aetna contribute about $ 8 Million per year in property taxes. Your suggested course of action seems tepid at best. Were we hoping that the problem might go away if we ignored it? The Common Council has a fiduciary responsibility to the City and this potential revenue shortfall eclipses any other budget issue. I am stunned and insulted that hard information concerning our #1 taxpayer has been withheld.
I recommend immediate action by the Council, the Mayor, Finance Director, PCD Director, and whatever outside expertise we need to enlist, to deal with Aetna and this impending revenue shortfall.
They mayor's administrative assistant Geen Thazhampallath replied to Bauer the same day, writing:
Councilman: We assure you nothing was withheld and that the Mayor is working the multiple facets of the issue along with the Chamber President, Finance Director and P&Z Director with the highest levels of Aetna. We'll be happy to meet with you to share any facts and data we have.
Not satisfied, Bauer points to recent information published by Moody's Rating Service which states "Management does not expect an adverse financial impact from the reduction in Aetna Life’s operations." and Standard and Poor's which reports "City officials project that the property Aetna plans to vacate will be quickly redeveloped." Moody's and S&P determine the credit rating for the city.
"I'm really concerned," Bauer said. "And any property owner in Middletown should be concerned. The first thing we need to do is have a workshop. We all have to be working with the same numbers so we can understand the potential impact."
Bauer feels that the city has not moved on the problem with appropriate haste, but that proper planning now could prevent a disaster.
"If we encourage development, it could be a half billion dollar development. It's 250 acres of prime land, with good access to I-91."
Bauer is demanding an immediate workshop.
Bauer writes in an email to the Eye:
We need to actively plan to cover this likely shortfall in revenues or we face a variety of unpleasant possibilities – dramatic cutback of services or property tax increases. We have to face these likely scenarios before we can engage our State Legislative delegation and force every Gubernatorial candidate to take a position on this issue. This situation has another bad effect on the Westfield Fire District because Aetna contributes over 20% of the revenue to the District.
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