What is Proposition 2½ and how does it affect my assessment?
Proposition 2 ½ is a State Law which restricts the increase on the total levy limit to no more than 2 ½%. The levy is defined as the total amount of tax dollars we actually bill for the entire City, while the levy limit is defined as the maximum amount we could bill. The difference between the levy limit and the actual levy is called excess levy capacity. A very important exclusion for this limit is what is know as new growth. New grown is best defined as new construction or improvements that people make to their property. As a result, the actual total tax dollars the City bills may be greater than 2 ½% of the actual levy from the previous year. For the individual taxpayer or homeowner, it is important to remember that the 2 ½% limit does not limit the increase of your individual property to 2 ½%. In fact, there is no limit on the individual value increase or tax increase on any one property as long as the value is fair, equitable and an accurate reflection of market value.
