Certified Tax Rate

Understanding the Certified Tax Rate

Purpose of Periodic Reappraisal

The purpose of periodic reappraisal is not to increase the amount of revenue derived from property taxes, but to update and equalize the values of all taxable properties in the county and to ensure that the burden of taxes is distributed fairly, according to those property values.

One of the final steps in the reappraisal process for a jurisdiction is calculating a Certified Tax Rate based on the updated property values. Primarily the responsibility of the county or municipal legislative body, this procedure requires input from both the Assessor of Property and the State Board of Equalization.

Tennessee Code Annotated 67-5-1701 provides that upon a general county reappraisal of all property, the Assessor of Property must certify to the local legislative bodies the total assessed value of all taxable property in their respective jurisdictions. The Assessor must also furnish an estimate of the total assessed value of all new construction and improvements that were not included on the previous assessment roll, and the assessed value of deletions from the previous assessment roll. Exclusive of new additions and deletions, the local legislative body is required to determine and certify a tax rate which will provide the same "ad valorem" (according to value) property tax revenue that was levied during the previous year.

Prior to final determination of the jurisdiction’s certified tax rate, the legislative body must submit a proposed certified tax rate, including all supporting calculations, to the Executive Secretary of the State Board of Equalization for review. The Executive Secretary then has 15 days to review the submission and issue a report (or not). The local legislative body, after reviewing the state’s report (if one is issued) may make changes to the rate if they so choose, and then must certify a tax rate as their jurisdiction’s official certified tax rate.

Exceeding the Certified Tax Rate

In order to levy a tax rate in excess of the certified tax rate, the county commission must:

  • advertise the intent to exceed the certified tax rate in a newspaper of general circulation in the county;
  • furnish the State Board of Equalization with an affidavit of publication within 30 days after the publication;
  • hold a public hearing on the issue of exceeding the certified rate;
  • adopt a resolution to levy a tax rate in excess of the certified tax rate.

If the purpose of exceeding the certified tax rate is solely to offset the amount of reductions to the tax roll caused by County or State Boards of Equalization rulings, the increase may be adopted without following this procedure.