Property Values and Your Taxes - It's Complicated

Property Values & Your Taxes – It’s Complicated (But We’ll Explain)

Did you know that rising property assessments don’t automatically mean higher taxes?

That’s because municipal budgets are set separately from assessments. Whether property values go up or down, the Town doesn’t collect extra revenue—it only collects what’s needed to fund services. 

How Your Taxes Are Calculated

🔹 Expenses: Each year, Council sets a budget based on the cost of services like police, fire, recreation, parks, and roads. Inflation, service demand, and other levels of government all play a role. Town Council works to balance prudent and predictable taxes with quality services.

🔹 Revenue: In Alberta, towns collect taxes based on property assessments, which determine each owner’s fair share of municipal costs. In Strathmore, a third-party assessor (not the Town) determines property values. Our team then calculates a tax rate (mill rate) that raises exactly the amount needed to fund the budget.

Let’s break it down:

Imagine a town with...

✅ A $30 million budget
✅ 10,000 homes valued between $200K and $2M
✅ An average home value of $500K
✅ A total property value of $5 billion

To fund the budget, the town sets a tax rate of $6 per $1,000 of assessed value. That means a $500K home pays $3,000 in taxes.

Now, let’s say property values rise 20% to a total of $6 billion. The budget stays the same, so the tax rate is lowered to $5 per $1,000. If your home’s value also rose 20%, your tax bill stays at $3,000.

👉 If your home’s assessment increased less than average, you might see a tax decrease.
👉 If your home’s assessment increased more than average, your taxes will likely go up.

What About Tax Increases?

If the Town raises taxes by 3%, the average homeowner will see a 3% increase. However, because assessments don’t rise evenly, some property owners will see higher or lower changes. In the above example, a 3% tax increase means the Town's total tax revenue rises from $30,000,000 to $30,900,000, which is then distributed among property owners based on their assessments.

The Bigger Picture

Tax calculations get even more complex because:
✅ Commercial properties pay different tax rates.
✅ Some properties, like charities, are exempt.
✅ New development can spread out tax costs but also increases expenses.
✅ A portion of your tax bill goes to other levels of government, not just the Town.

TL;DR Version

✅ Higher assessments don’t mean more revenue for the Town.
✅ Assessments determine how taxes are split, not how much is collected.
✅ If your assessment rises above average, your taxes go up.
✅ If your assessment rises below average, you could see savings.

Got questions on your assessment? Wildrose Assessment Services can help! Call 403-343-3357 for expert, no-fee assessment support. They’ll review your property details and make any necessary corrections.