Reassessment Shows Big Jump In Real Estate Values
In the wake of the recently released results of Lexington’s real estate tax assessment, the city’s tax rate is being lowered by more than 20 cents per $100 of assessed value in the upcoming fiscal year.
Lexington City Council, during its regular meeting last Thursday, unanimously approved a resolution to appropriate spending for the fiscal year 2026-27 budget with only one amendment from what had been advertised for a public hearing at Council’s May 7 meeting: lowering the real estate property tax rate 23.4 percent, from 92 cents per $100 of assessed value to 70.4 cents per $100 of assessed value.
The change was recommended by the city’s Finance Director Jennifer Bell after the reassessment showed a 31.9 percent increase in the total taxable value of properties within the city since the last reassessment in 2022.
The assessment results showed an increase of $283,911,281 in the total assessed value for properties within the city, going from $2,016,742,220 to $2,300,653,901 for a 14 percent increase. There was also a nearly 5 percent increase in - the value of the exempt parcels within the city, increasing from $1,330,987,400 to $1,395,970,644. This resulted in a total taxable value of $904,683,257 under the new assessment, up from $685,754,820 in the 2022 assessment These values, which were presented to City Council, may change if people appeal their reassessment and are granted said appeal. Any individuals wishing to appeal their reassessment will have until June 19 to submit the appeal.
As a result of the decrease in the tax rate, the anticipated revenue for the city in real estate taxes will decrease from $6,407,072 to $6,368,970 (a difference of $74,289).
Bell explained to City Council that the anticipation is that the shortfall in revenue from real estate taxes will be made up by increased interest earnings on the city’s investments. The budget for FY27 anticipated interest rates of around 3.375 percent, and the federal funds target rate is currently between 3.5 and 3.75, with the city’s investments currently earning around 3.8 percent.
David Sigler made the motion to approve the resolution with the amended tax rate and Nicholas Betts provided the second.
