SKOWHEGAN — Houses are selling better than paper mills and that’s bad news for homeowners with tax bills coming soon.Taxes for residential properties in Skowhegan are estimated to increase over 15 percent on average this year — many home owners will see increases of over 20 percent — with the majority of that jump related to the boom market in real estate in past years, according to Bill Van Tuinen, assessor’s agent.
“There is no easy way to explain it. The real estate market has been good and it is resulting in somewhat of a different composition of the tax base in Skowhegan,” Van Tuinen said Tuesday night, speaking to selectmen and residents.
He said the most recent figures of the Maine Revenue Service show that on average , the ratio of the assessed value of homes to actual sales prices was 76 percent. That means the town is valuing homes at about 24 percent less than what they are selling for.
While the housing market has cooled somewhat in the past year or so, that trend is not reflected in the data that make up the state’s sales ratio. The home prices that go into the ratio are about two years old.
The value of the town’s largest industrial property — the SAPPI Fine Paper North America Somerset Mill — however, has not kept pace, although Van Tuinen acknowledged that due to a shortage of sales of paper mills in recent years, it is more difficult to value the huge complex.
That growing gap means that the town has to adjust the valuation of residential properties higher to reflect the prices homes are selling for. That in turn means that more of the town’s overall tax burden will fall on home owners and less on industrial property.
According to charts Van Tuinen released Tuesday, in 2006, industrial property accounted for 66.8 percent of the town’s overall tax base. In 2007, industrial property will represent about 61.6 percent.
Van Tuinen said that if the town does not readjust its property values to reflect sales prices, it would have little defense against tax appeals.
Van Tuinen said he was not sure when property tax bills would be mailed out.
By ALAN CROWELL, MaineToday.com