NE property taxes. OUCH!! (Omaha, Papillion: real estate, insurance, house)

[CA central coast]

Educate me here. I was looking at real estate on-line in some SMALL towns around Nebraska. The property taxes seemed out of site. What's the criteria? do they vary by county?

[Dave1215]

They vary not just by county but at the town level as well.

Towns generate most of their operating revenue from property taxes so they set a local rate.
Counties also do the same thing as do the fire districts, community colleges, and school districts.

So depenpending on how well each of those 5 entities that you live within manage determines your tax levy. The school district is the biggest factor - its probably 55% of your property tax bill - so look at school district more so than the town.

Primary 5 being:
School
Town
County
Fire
Community College

The tax levy is broken by each of these, so if you are looking at an area you can get the breakdown from the local County Assessor.

[tpabes]

The percentage for Nebraska property tax is high and it will vary from town to town, but you have to remember the price of a home in the small towns of Nebraska and the low cost of living.

[ehenningsen]

The rates are high, but if you do the math, for the same house you would get in california not only are you paying 80,000$ instead of 800,000$, but the 'high tax rate' which is about double the rate here than in CA, means that you pay 1,600$ a year instead of 8,000$ for the SAME house

[tpabes]

Which small towns are you looking at? There are some small towns in Nebraska that do free lot programs if you are interested. Central City, Fullerton and Kenesaw do them and I believe there are others.

[Dave1215]

Also understand if you are in the corporate boundaries of the town or just outside of the town... In Nebraska there is a concept of an "SID" (Sanitary Improvement District)... it is a legal entity that developers can create to help finance a new development or subdivision. The SID has taxing authority to help pay the debt of the development, to maintain its common areas, and to keep its streets maintained.

For property tax purposes the SID levy would replace the Town levy.... most people don't understand this and when they have a high tax bill they blame it on the city, but in reality they don't live in the town and the control is at their local SID board level and they didn't think about that when they originally bought their property....

Where I live (Papillion), I live in the corporate boundary of the town so get Papillion's city levy; however, Papillion has a lot of SID's around it... because each SID is independent some are good and some are bad... good ones have reasonable debt level and keep things maintained so the SID levy is not much more than the towns... however, there are a couple of SID's that have high debt and roads are not the best so will be facing repairs - in that case the SID levy is very high (like double the towns).

Long story - but in the Omaha metro area, Papillion has one of the lowest levy levels for city/towns; however, I could take my same house and move it about 8 blocks into one specific SID and my taxes would almost double because of that SID's high debt problem.

So again, understand primarily the School District portion of the levy and secondarily the City/Town/SID component of the levy.

The only relief from a high SID levy is for the city/town to annex the SID - but if the SID has a lot of debt or bad roads the likelyhood of being annexed is not very good because upon annexation the town/city assumes that debt and is obligated to bring those newly acquired roads up to standards - which would cost the town/city money. So bad SID's tend not to be annexed which means you don't get the relief you were dreaming of.

[jeepejeep]

You wanna see high taxes? Come to Long Island in NY. Absurd!

[StealthRabbit]

Originally Posted by Dave1215

They vary not just by county but at the town level as well.

Towns generate most of their operating revenue from property taxes so they set a local rate.
... The school district is the biggest factor - its probably 55% of your property tax bill - so look at school district more so than the town.

Primary 5 being:
School
Town
County
Fire
Community College

The tax levy is broken by each of these, so if you are looking at an area you can get the breakdown from the local County Assessor.

Good advice, when relocating ALWAYS visit the assessor, local school district, and check with fire marshal or your insurance agent on rating of fire protection.

Schools usually get the biggest share, sometimes libraries get a cut and in suburban / urban, look for local transportation district charges.

I pay $33/ day for property taxes on a joint we built for under $100k, and the local school gets $17 / day of the taxes (and has a terrible academic rating). For perspective... I spend $3 / day on food... This gets really tough on a fixed income = "Zero" (I was laid off 6 wks BEFORE retirement eligibility, after 32 yrs with same company...)

NE is pretty steep in overall tax burden when compared to other states. My relocation spreadsheet excluded most of the state due to higher costs of transport and food in more remote areas (proximity to medical / and airports), and low potential for real estate growth to support tax burden. It is sad, because rural NE can have a great quality of life, so one has to make their choices.

[CA central coast]

Wow, thank all for the good information. I really appreciate it. I was coming from the perspective of retirement and a fixed income, so that's where my mind set was. I can't remember all of the small towns I look at off hand right now. I also looked at Chadron and Scottsbluff. O'Niell was the one that got my attention. $165,000, on the golf course, nothing too spectacular, $4400 a yr. prop. tax. I guess I was initially surprised because that is more than I pay on a $400,000 dollar home. Incedently, I'll never be able to pay off my home before retirement, my paycheck only covers 2/3 of the mortgage, my wife's picks up the rest, most young families can never hope to buy in the area I live. It's still hard to believe I've made it this far. CA can be a tough place to buy a home and raise a family. If prop. taxes weren't capped at 1%, I definetly couldn't do it where I'm at.

It looks like it definetly would be wise to do your homework before buying out there. I'll check out those free lot sites too. Thanks for the info. I looked at the smiliar offerings in Kansas. I have young children now, so I just can't take off on a whim like I used to. I'd like to get out there though sometime. Get a good look at the state.

[Dave1215]

Originally Posted by CA central coast

Wow, thank all for the good information. I really appreciate it. I was coming from the perspective of retirement and a fixed income, so that's where my mind set was. I can't remember all of the small towns I look at off hand right now. I also looked at Chadron and Scottsbluff. O'Niell was the one that got my attention. $165,000, on the golf course, nothing too spectacular, $4400 a yr. prop. tax. I guess I was initially surprised because that is more than I pay on a $400,000 dollar home. Incedently, I'll never be able to pay off my home before retirement, my paycheck only covers 2/3 of the mortgage, my wife's picks up the rest, most young families can never hope to buy in the area I live. It's still hard to believe I've made it this far. CA can be a tough place to buy a home and raise a family. If prop. taxes weren't capped at 1%, I definetly couldn't do it where I'm at.

It looks like it definetly would be wise to do your homework before buying out there. I'll check out those free lot sites too. Thanks for the info. I looked at the smiliar offerings in Kansas. I have young children now, so I just can't take off on a whim like I used to. I'd like to get out there though sometime. Get a good look at the state.

Depending on age, Nebraska also has a homestead exemption which removes some of your property value from being taxed... not sure how old you are since you mentioned both retirement and young kids, but wanted to point this out...