Property taxes are not expected to rise in either Zephyrhills or Dade City after governments in both cities put together 2014 budgets.
The rate in Zephyrhills was tentatively set at 6.1415 mills ahead of its Sept. 16 meeting, where the city council there will make a final decision on taxes. The rate remains the same as last year, and despite recent property value declines, will actually generate a little more revenue for the city.
That’s because the council was aggressive this past year in annexing areas along Fort King Road, as well as the Silver Oaks area. While annexing areas might cost more to service, the tax revenue annexed areas bring in typically more than offsets those expenses.
In Dade City, commissioners approved a millage rate of 7.2, up from 7.1 last year. However, the city — which has not raised taxes since 2009 — has the option to lower it back to 7.1 ahead of its September budget meeting. Once the commission sets the tax rate, it is allowed to only lower it, not raise it. By starting it higher, it gives the commission some wiggle room in case taxes do need to go up.
One mill represents $1 of tax on every thousand dollars of taxable property value. For example, in Zephyrhills — based on a Zillow-reported average home value of $73,400 — the tax would be $297.25 after standard homestead exemptions. In Dade City, the average home valued at $67,000 would carry a tax of $302.40 after the homestead exemption.
Both cities have taken a long, hard look at annexation in recent years to try and make up for potential budget shortfalls plaguing other municipalities because of property value declines. However, recent news in the housing market showing significant gains in home values may change that need.
A new CoreLogic Case-Shiller report shows that home prices increased 10.2 percent in the first quarter compared to a year ago, the first double-digit increase since the peak of the housing bubble, according to the Florida Association of Realtors. Home price increases are generally followed by property value increases, which means more tax revenue for cities like Zephyrhills and Dade City without the need to raise taxes.
