Commission Meeting – March 2007
TAX BASE 101
Todd Kaufman, CAE
Loudoun County Assessor
CODE OF VIRGINIA § 58.1-3201
What real estate is to be
All real estate annually
Except exempted real estate
SHALL BE made at 100%
fair market value
Loudoun County Business Regulation
and Taxation Code 860.09(a)
ASSESSMENT AND EQUALIZATION OF
Assessment and equalization of real estate
for local taxation shall be performed on an
CODE OF VIRGINIA § 58.1-3280
Assessment of values for…..
All lands, lots, and improvements
SHALL physically inspect
CODE OF VIRGINIA § 58.1-3330
Notice of change in assessment.
Requires that property owners
be notified any time there is a change
in the assessed value of their real estate.
• "Market value" is the cash price a
property would bring in a competitive and
open market. In such a market, sufficient
time has been allowed for a sale, the
buyer and seller are not subject to undue
pressure, and both are well informed.
Market Value may not be the same as the
PRICES AND VALUES
• “Prices”…historical facts.
• “Values” …opinions…hypothetical prices,
based on actual prices, when comparable
properties sold in a competitive, open market.
• Market value can also be viewed as the present
value of future benefits (income approach).
• The date of value for assessments in Loudoun
County is January 1st of each tax year.
• Residential – sales within 12 months prior
• Commercial - sales and income data for
up to 36 months prior to DOV
• Fewer commercial sales.
• Income approach better supported by
stabilized I and E during a three year
period to establish a trend.
WHY FAIR MARKET VALUE?
• Fair…Objective…Easy Understood
• Avoids subjectivity
• Supported by market derived sources such as sales.
• Tax levy changes as market changes
• Relatively – market value – tax rate – budget
• Tax rate is not a constant factor
Methods, techniques, and mathematical
procedures that an appraiser uses to
analyze a property’s capacity to
generate benefits and convert these
benefits to an indication of present
value. The key element in establishing
value is the determination of the
• Replacement cost of improvements
• Subtract depreciation
• Add land value
Three basic sources:
• Construction contracts
• Historical files
• Cost services (Marshall and Swift)
• Informed purchaser
• Pays no more for a property than the cost
to him of acquiring an existing property
with the same utility.
• Use recent market transactions in
comparison to the characteristics of a
subject property to support value.
2007 Real Estate Tax Base Distribution (Office of the County Assessor)
Ag > 100 Ac 7% 2%
Ag 20-99.99 Ac
Real Estate Tax Distribution 2005 to 2007 (Office of the County Assessor)
2005 2006 2007
2007 OVERALL CHANGES
• All Real Property +4.34% or $2.79B; from
$64.52B to $67.32B
• -0.38% equalized value (-$241.9M)
• $3.04B construction/growth (4,102 parcels)
• $712.4M supplementals (3,163 parcels)
2007 OVERALL CHANGES
• Residential < acre -2.03%
• Residential > acre < 20 +8.47%
• Multi-Family > 5 units +10.53%
• Commercial/Industrial +18.51%
• Residential >20 a < 100 a +14.63%
• Residential >100 a -0.24%
• SCC +2.99%
2007 Commercial Property
• The equalized commercial tax base
increased 13.43% or $1,137,881,699.
• New construction and growth
• The commercial tax base increased
18.51% or $1,568,905,999.
2007 Value Allocation by Class and District (Office of the County
$ Per Billion
Blue Ridge Broad Run Catoctin Dulles Leesburg Potomac Sterling Sugarland Run