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Equalization Rates for School Taxes FAQ

What are the equalization rates for the various towns in our District?
Equalization rates for the various towns in the Onteora Central School District are as follows:

            Hurley              –          76.4%

            Marbletown     –          70.00%

            Olive                           100.00%

            Shandaken        –          18.50%

            Woodstock       –          61.00%

            Lexington         –          75.80%

 

Why are these numbers different?
The process of equalization is used to determine tax rates. Essentially, “full market value” serves as a common denominator, or equalizer, in the process of setting tax rates.

In general, if a town’s equalization rate is less than 100 percent, it means that overall, the property in the town is assessed at less than market value. (Meaning, if homeowners were to sell their home today, they would likely be able to sell it for an amount greater than their home’s assessed value.)

If the equalization rate is at 100 percent, it means a property’s assessment should be roughly its market value. (This means a homeowner in one of these towns would likely be able to sell their home for an amount that is equal to the home’s assessed value.)

How do equalization rates work?
An equalization rate is New York State’s measure of a municipality’s level of assessment and how close a property’s assessment is to its actual value. They are designed to ensure that owners of properties with similar full market values pay an equivalent amount of taxes.

To calculate an equalization rate for a given town, which is done by the state (not the school district) and finalized in August before the start of the school year, the state takes the total assessed value of the municipality and divides it by the total market value of the municipality. The end result is the equalization rate.

For example, if a town’s equalization rate is 100 percent, the town is assessing property at 100 percent of the market value. This means a reassessment was likely conducted in recent years. Your property’s assessment should be roughly its market value (the price for which you could sell your property).

If a town’s equalization rate is less than 100, this means that overall, the property in the town is assessed at less than market value. The lower the equalization rate, the longer it has probably been since the last reassessment.

The equalization rate will change from year to year based on the real estate market and each property’s assessment. Both equalization rates and assessments are finalized in August before the start of the school year.

Why are equalization rates necessary in New York State?
Each municipality determines its own assessment level (in contrast to most states that require one level of assessment statewide). Hundreds of taxing jurisdictions – including most school districts and counties – do not share the same taxing boundaries as the cities and towns that are responsible for assessing properties.

To distribute school district or county taxes among multiple municipalities, the level of assessment of each municipality must be equalized to full market value. Equalization rates are based on local data collected by the state.

The school district does not control equalization rates. It only controls the tax levy, or the amount that taxpayers within its boundaries will contribute to the district’s budget. The tax levy and the tax rate are not the same. The tax rate is the amount of tax paid for each $1,000 of assessed property value.

If all municipalities assessed property at 100 percent of market value, equalization rates would not be necessary. However, most of the state’s more than 700 school districts distribute their taxes among segments of several municipalities, many of which have different levels of assessment. The number of municipal segments in the Onteora Central School District is six (6).

Equalization rates measure the level of assessment for the entire municipality. They are not intended to correct unfair individual assessments in a city or town. The assessor has the primary role in ensuring the fairness of individual assessments. The more frequently properties are reassessed based on current market values, the more likely it will be that assessments are fair. Property owners also have a role to ensure their assessments are fair.