Opinion and Commentary
There are a lot of good arguments as to why San Angeloans should support the proposed Skybox Datacenter. One of the benefits touted to the community would be the increased property tax value it would bring.
Projections are that it would increase property tax values within the City of San Angelo by $7 Billion. According to City Finance Director Tina Dierschke, the current property tax value of the entire city is around $7.9 Billion.
Assuming tax values do increase by that margin, that would increase tax revenue available to the City and other local governments considerably.
Theoretically, increased values on commercial properties can mean a reduced property tax burden on residential homeowners. Compared to other similar cities, San Angelo’s tax burden falls more heavily on residential properties. This is because of the small economic commercial property base here.
What Will City Do With Additional Revenue?
Increasing the commercial property tax values in San Angelo is a good thing, but no one should get the impression this project means property taxes will be coming down for homeowners.
While it may help reduce the residential property tax burden in the long term, whether homeowners will see any impact depends on how the City manages the additional revenue. If the project is built, you aren’t going to see any relief on your property tax bill any time soon.
Economic development projects can impact local property taxes over 20 to 30 years as the tax base increases in value. This is because new development and increased commercial activity will increase the tax base overall.
The bigger the tax base the lesser the tax burden on individual property owners.
Also, this project will add new property to the tax roll, so that will be a benefit to the tax base.
But there is no direct correlation between an economic development project like this and tax relief. That will depend on City Council.
When City leaders talk about the potential for lower property taxes they are talking long term.
Unless the City were to reduce the property tax rate because of the increased revenue, you are not likely to see an impact on your tax bill.
Additional Revenue Could Be Used For Other Purposes
But we also know that the City has lots of need for money to put toward infrastructure, police, fire, and other improved services.
Some of the new revenue would likely be used for other needs before property-tax reduction. Depending on how the City Council manages the additional revenue, it may not actually reduce property taxes for homeowners at all.
So far no one has said or promised that this project would reduce residential property taxes in the next three, five or even 10 years. Whether it does will depend on the increased value, its impact on city revenue, and how council manages the revenue and tax rate going forward.
