LOUISVILLE, Ky. (WDRB) – The Jefferson County school board is likely to vote tonight to raise its property tax rate, resulting in higher bills for homeowners this fall.
But instead of asking average people to pay more, the district could find some additional tax revenue at the racetrack, said John May, the Republican nominee for Jefferson County property valuation administrator.
May, who faces Democratic nominee Colleen Younger in the race for county tax assessor this fall, said he plans to use tonight’s hearing on JCPS’ proposed tax increase to call attention to the favorable deal Churchill Downs gets on taxes for its iconic racetrack at 700 Central Avenue.
In an interview, May said the district needs to ensure it’s getting fair payments from the Louisville-based company “before we go ahead and shift the burden to single moms, first-time homebuyers, veterans (and) retirees.”
WDRB reported last spring that, unlike the average homeowner’s property, the official tax value of the racetrack hasn’t changed since 2002, remaining the same $20.4 million despite hundreds of millions invested in the facility and additions to its footprint.
The reason has to do with the racetrack’s special status: It is technically government-owned property exempt from taxes. But since 2002, Churchill Downs has had a side agreement with JCPS to directly pay the school district for taxes it would otherwise owe, which is about $170,000 a year.
The issue is that the base on which those payments are calculated hasn’t changed in 16 years.
PVA Tony Lindauer, the elected official who values property for tax purposes, said his office wasn’t aware of that agreement, and so it treated the racetrack like government property and did not reassess its official tax value.
That’s in contrast to average homeowners, whose assessments generally change at least every four years, if not triggered by a sale or an improvement like an addition to the square footage.
“If I add a garage into my property for $10,000 or $12,000, you can betcha they’re going to be on me to me to the tax rolls,” May said.
May and Younger, who is Lindauer’s chief of staff, agree the situation needs to be addressed.
May said he wants to make sure the PVA is aware of all the special tax agreements JCPS has with businesses like Churchill Downs. Younger said she would go a step further by pushing for a change in state law that would ensure the side deals are reported to county PVAs.
“We have been left out of the loop on this kind of thing,” said Younger, who added that May didn’t change the racetrack’s assessment when he served a brief, appointed stint as Jefferson County’s PVA in 2005 and 2006.
When WDRB first reported the situation in May, Lindauer noted that JCPS never exercised its right to complain that the track’s value was too low.
The Kentucky Department of Revenue, which oversees county tax assessors, made that point in June in a cautiously worded letter responding to May’s request to look into the situation.
JCPS spokeswoman Renee Murphy said Tuesday that the district is “working with the PVA on this matter.” She declined to elaborate.
Younger said the discussions have included sharing the cost of a third-party appraisal of the racetrack property, which the PVA office does not have the resources to assess using internal staff.
A Churchill Downs spokesman has not responded to a request for comment.
JCPS, which gets the lion’s share of local property taxes, plans to raise its tax rate to 72.5 cents per $100 assessed value, from the current 70.4 cents.
For the average Jefferson County home – which sold for $207,127 last year, according to the Greater Louisville Association of Realtors – the change would mean an additional $43.50 in annual school taxes.