Key To County’s Wealth Is Property Assessment

As we look at the financial picture over the past 40 years of our body politic in Chautauqua County, a lot has changed. It has often been said that “if you want to know what is happening, follow the money.”

I have always believed that statement to be overly simplistic. It might be better to say in analyzing our government, “where is the wealth located?”

In the case of our union in a common government at the county level, at least one place to measure that wealth is with the real property assessment rolls.

In 1970, the total assessed full value of the whole county was $781,390,048-under $1 billion. By 2010, that value had grown to $6,673,546,112 or $6.67 billion. That growth rate is slightly greater than the cost-of-living adjustment over that period of time.

So that is good news – the county’s value as measured by real property wealth grew faster than the rate of inflation. It also was a measured and modest growth. We didn’t go up and down in the dramatic swings of the real estate market and so were less affected when the “housing bubble” across the country blew up bringing on our most recent recession. So, though our population in the county has decreased 8 percent since 1970, our real estate values have experienced a real, though moderate, increase.

A good portion of what we pay in real property taxes goes to the county. How much we pay is based upon the percentage of the total value of the county that we own, our own individual property assessment. The county “levy”, as it is called, is actually raised by the county sending out bills to the towns and cities. These units of local government have their own adjusted full value, and are billed by the county for their proportionate share of the county budget. The towns and cities then turn around and send each of us, as individual property owners, a tax bill which includes their own budget expense as well as the county levy. It is a somewhat convoluted and hard to understand system, but it brings in the money. In 2011, the Chautauqua County real property tax levy was $58,893,945.

There have been some remarkable changes in how the value of property has shifted in our County in the past 40 years. Here are some highlights.

In 1970, the city of Dunkirk paid 20 percent of the County levy, and the city of Jamestown, 21 percent. In other words, these two cities constituted over 40 percent of the entire value of the county. In 2010, however, Dunkirk paid just under 5 percent of the county levy and Jamestown paid 10 percent of the county tax. There has been a significant shift in property values from our two cities to surrounding areas outside the cities.

Where did the values go? In 1970, the combined assessment of the towns and villages that surround Chautauqua Lake (Busti, Ellicott, Ellery, Chautauqua, North Harmony including the villages of Lakewood, Celoron, Bemus Point, Falconer and Mayville) totaled 24 percent of the countywide assessment. In 2010, these same towns and villages had grown in value and were paying 42 percent of the county levy. One town, the town of Chautauqua (the home of Chautauqua Institution), is now valued at slightly over $1 billion – more than the assessed full valuations of Dunkirk and Jamestown combined.

What does all of this tell us? For one thing it reinforces the value of Chautauqua Lake to the community. The real property tax value in the towns around Chautauqua Lake is paying over 40 percent of what we levy on ourselves as the county tax. The lake is a major resource and is a driving economic force in the county. However, as taxes have gone up around the lake so has the anxiety over paying them. Some people have the left the lake because of the taxes. All are worried about the water quality and weeds in the lake and how that could affect property values.

Though properties near the lake have gone up in value, the people who live there need to also be concerned about the relative decline in property values in Dunkirk and Jamestown. When those cities were more viable, they shared more in the costs of running the county. People who live outside these cities should be cheering for them to do better. Financially stronger municipalities help everyone who lives here in the community corporation we call Chautauqua County.

There is another change that has occurred since 1970 which directly affects northern Chautauqua County, and that is the deregulation of electricity production.

The Dunkirk generating plant has always been, in my memory, the major taxpayer in the City of Dunkirk. Today it pays approximately 35 percent of Dunkirk’s city and school district tax levy. Forty years ago, when the production of electricity was owned and controlled by Niagara Mohawk, the utility readily paid these taxes and passed on the cost to its customers. However, today, electricity generation has been deregulated and the current owners of the plant have been in financial trouble. If that plant closes, it will no longer contribute to the revenues of the city of Dunkirk, nor will it be contributing to Dunkirk’s share of the county tax levy. Therefore, it is in everyone’s best interest, both north and south county, to try and keep the Dunkirk generating plant in business.

Why write about real property taxes at all? It is such a boring subject. Yet, it is an important topic. We are talking about real money that most of us are obligated to pay. Property taxes are still the primary local source of income for school districts and for town, village, city and county government. Most of us don’t like paying property taxes, but they are a major part of being and participating in this place we call home, Chautauqua County. Maybe having more “perspective” on it will help in determining how much government we want and how much we can afford.

A Chautauqua County resident interested in analyzing public policy from a long-term perspective writes these views under the name Hall Elliot.