Sen. Almando "Rocky" Liburd addressed a letter to V.I. Tax Assesssor Roy Martin Wednesday objecting to a 10 percent increase in property taxes on St. John while St. Thomas and St. Croix had lesser rates in increase.
In the letter, circulated to the news media, the at-large senator said he also had written to Senate Finance Committee chair Lorraine Berry "asking her to convene a hearing to look into why there is such a big disparity" in the rates.
Martin said it's a matter of mathematics and the real estate market on the three islands.
Liburd's letter cited increases of 6 percent for St. Thomas and 5 percent for St. Croix in addition to the 10 percent for St. John. According to Martin, the figure for St. Thomas is 7 percent and the other two are correct.
By law and in current practice, Martin said, the actual worth of real property is re-evaluated every two years. This is done by two means, he said – with personnel from his office "out in the field doing the evaluations in new construction and additions and improvements to existing property," and from sales recorded during the period.
The most property taxes can go up for any one year is 10 percent. But Martin said the most recent re-evaluations found that the actual value for residential property on St. John increased much more than that from two years earlier. "Depending on the type of residential property category," he said, the increase ranged "from 20 percent up to as high as 35 to 40 percent."
On all three islands, he said, "the assessed values have gone up because of the market conditions." The large increase for St. John was not a surprise, he added. "We knew from a little while back that St. John was a little ahead of the other islands, based on the sales," he said.
Liburd in his letter stated that while the law allows for a maximum 10 percent increase, "I think it is totally unfair for St. John's tax rate to be placed at the highest level, considering the economic hardships many of our residents are experiencing."
He added, "This situation has caused major concern for the residents of St. John, who are wondering why the district of St. Thomas-St. John has two different tax rates being assessed." He asked Martin for "an explanation as to why the St. John property tax rate is the highest in the territory, whereas St. Thomas and St. Croix rates are still considerably under the 10 percent maximum cap increase."
Whether a 10 percent increase is steep, Martin said, "depends on what point you're looking at it from. Historically that has been the maximum percentage applied, with two exceptions: If property since the last evaluation has been improved by $50,000 or more, or if the property was sold since the last evluation."
Liburd also asked Martin for his help "in securing a more fair and equitable way of applying property tax increases for the island of St. John." Later Wednesday, Liburd said that Sen. Berry had agreed to schedule a Finance Committee hearing on the matter next Tuesday on St. John.
Martin also noted that, technically speaking, there was a change in the formula for calculating property tax this year – but one that makes no difference in the bottom line. The change was made to conform to a provision of the enabling legislation for the government's $300 million bond issue late last year, he said. "The law dictates that we show the 100 percent value of properties," he said, whereas this had not previously been the case. But, applying the formula, "what you should come up with is the same," he added.
Property tax bills were sent out in mid-June, Martin said, with the first deadline for payment June 30. However, property owners have until Aug. 31 to make their payments without penalty. As of Sept. 1, he said, "a penalty of 1.5 percent per month starts."
Martin noted that property owners can request an administrative review of their tax bills by telephoning or visiting an office of the Tax Assessor. "If we find any errors, we will correct them," he said. "And if the parties are still not satisfied, they can file a formal appeal."
He urged property owners who who have not yet received their bills to call the nearest office of the Tax Assessor – 776-8505 on St. Thomas, 776-6737 on St. John, 772-3125 in Frederiksted and 773-6449 in Christiansted.
