How county tax levies are calculated

Custer County residents and other landowners should have received their property tax bills for the 2022, payable 2023, year. In this article, the county’s intent is to help explain tax requests, tax levies and how they are calculated.
The Department of Equalization carries out the first step by assessing your property. A market value for your property is determined, meaning the amount your property would sell for on the open market. All values are arrived at from doing a market approach, cost approach, or if county-wide data is available an income approach in accordance with South Dakota Codified Law. This is the valuation used in calculating your taxes. If you have any questions regarding your assessment contact the County Department of Equalization Office.  
The different taxing districts (County, Cities, Fire, Ambulance, and Secondary Roads) are restricted to a growth formula that determines the maximum tax amount each district can request. The amount cannot exceed the Consumer Price Index (determined by the State) plus the growth amount within their district. The one exception to this is the Special Assessment Road Districts, as they set and vote each year on the amount they wish to charge.
Tax levies for the three Custer County Schools are calculated differently; they can either request a specified amount for their General and Special Education Fund or choose to use the maximum levy figure (determined by the State). The Capital Outlay Fund allows a school district to authorize an annual tax levy and is the same for all land classes. The state and the school district analyze the data and calculations annually to determine the appropriate limitation. There are three methods of capital outlay limitations; regardless of which limitation applies, a school district may never exceed a $3 capital outlay levy.
Once the maximum tax request is calculated the tax levy is arrived at by dividing the total assessed valuation of property into the amount requested.
(Allowable Tax Amount Requested ÷ Custer County Valuation) x 1,000 = TAX LEVY
Example:  ($4,198,876.21 ÷ 1,735,791,055) x 1,000 = 2.419                                  
Calculating the amount property owners owe in taxes is done by multiplying each levy by the property’s determined market value.
(Owner’s Property Value x Tax Levy) ÷ 1,000 = Amount to pay Taxing District
Example:  (325,055 x 2.419) ÷ 1,000 = $786.31
The tax levies county-wide decreased this year and property assessment values increased. It is helpful to remember the county is merely the vehicle for collection and disbursement of all property taxes to each tax district. Each district evaluates their budget needs and submits their tax request to the county. The county makes sure the amount does not exceed what they are allowed to request in accordance to state law.
We can tell you the total amount each district is collecting, but we are unable to offer any more insight or information to answer the “why or need” as we are not privy to how these organizations determine their budget.
Tax collection amounts and levies the county can effectively answer questions on are its own budgetary requirements and needs. The process for the county’s budget starts in July and final approval by the commissioners is reached in September to meet the state’s deadline of Oct. 1. The budget this year for the county to include the courthouse building expense increased by $232,059; county firefighting, encompassing the seven volunteer fire districts, saw a $16,075 increase; and secondary roads maintenance increased by $30,879 this year.
For more information the county has provided some graphs regarding this year’s taxes that you can find at the county’s website: custercountysd.com and on the county’s Facebook page: Custer County Courthouse.
—Submitted by the Custer County Auditor Office