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The Curious Bag
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The term tax mill refers to the tax rate on every $1,000 of real estate value that is taxable, sometimes referred to as the "millage rate." The word "mill" means "thousand."
Who is Responsible?
Local elected officials--city or county--are responsible for calculating the tax mill for real estate tax purposes every year.
Purpose of the Tax Mill
The tax mill is intended to cover the shortfall between non-tax government income-- license fees, fines and penalties---and the amount of revenue needed to fund public schools and provide essential services, such as fire and police protection.
Calculating the Mill
Divide the anticipated budget shortfall by the value of all the taxable real estate in the jurisdiction to find the millage rate. For example, if the calculations result in an answer of "three," the tax mill is a $3 assessment on every $1,000 of real estate value.
Public Hearing
After calculating the mill, the local elected officials will set a hearing for public comment prior to approving the millage rate.
Tax Mill Limitations
Some jurisdictions have enacted laws to set maximum tax mills in order to prevent elected officials from adopting high tax mills without first getting voter approval.
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