market value for residential and commercial property and productivity value for agricultural land. Assessed value is 50% of true and full value. Taxable value is 9% of assessed value for residential property and 10% for all other property classes. Therefore, taxable value is 4.5% of true and full value for residential property and 5% of true and full value for all other property. To calculate a tax bill, the taxable value is multiplied by the consolidated mill levy rate.

Q. What is Market Value and how is it estimated?

A. Market value is the most probable price that a property would sell for if exposed for sale in the open market between a willing seller and a willing buyer, free and clear of encumbrances. Normally, an appraisal is performed to determine market value. Lacking an appraisal or the assessor's true and full value, tax value estimates are sometimes made (a) using the fair sale price plus assumption of any special assessments, (b) using the construction costs of the new improvements plus land cost including special assessment improvements.

Q. What is an appraisal?

A. An appraisal is an opinion of value, performed by an individual who is competent and impartial. Generally, the appraiser determines market value; but in some cases, may be asked to determine insurable value, liquidation value, investment value, etc. The appraiser will normally consider the three approaches to value, (1) the cost approach, (2) the market approach, and (3) the income approach.

For financing appraisals, the appraiser is sometimes asked to determine market value, subject to assumption of the balance of special assessments. In those cases, the contributory value of the special assessment improvements must be added to estimate true and full value for assessment purposes; as assessors are required to assess all improvements, free and clear of the encumbrance.

Q. How is Agricultural productivity value determined?

A. True and full value of agricultural land is not based on the market value concept. It is based on a productivity formula established by the ND Legislature. Each year, the State Tax Commissioner certifies the county average agricultural value to the county director of tax equalization. The county director then determines the average agricultural value of each assessment jurisdiction. The local assessor then determines the value of each agricultural parcel by considering soil productivity, soil capability, and soils analysis.

Q. What are Special Assessments and Drain Assessments?

A. Special assessments and drain assessments are a special charge for a public improvement that benefited your property. These improvements include water and sewer lines, paving, lighting, sidewalks, etc. Drain assessments include projects sponsored by the water resource districts that improve drainage of the benefited property. Rural paving projects and sewage collection projects may also be assessed as a drainage item. The annual installment of payment of special assessments and drains is billed on a separate line on your annual statement of taxes. The balance of special assessments and drains are available from the entity that levied the assessment. For a contact list, click here.

Q. What is the 5% tax discount?

A. In North Dakota , the property tax and annual installment of special assessments and drains are collected at the end of the calendar year. The first half of the taxes and the entire installment of specials and drains are due by March 1 st following the end of the calendar year. The second half of the tax installment is due October 15 th . If the entire tax and all specials and drains are paid in full on or before February 15 th , a 5% discount is allowed on the property tax portion only.

Q. How is the mill levy determined?

A. The county auditor computes the mill levy rate that is applied to the taxable valuation of each property. It is calculated by dividing the budget amount of each taxing district by the taxable value of that district to obtain the tax rate. A consolidated tax rate is then calculated for each property by adding the tax rates of each of the taxing districts that affect the property, such as county, city, school, etc. The resulting consolidated tax rate is applied to the taxable value of each property to arrive at the total consolidated tax. The taxation rate is often expressed in mills, which represents 1/1000 of a dollar. Therefore, a mill rate of 300 mills represents taxes of $.30 per $1 of taxable valuation.

Q. Why does the assessor's estimate of value differ from my estimate?

A. If the assessment is lower than your estimate, the property may be receiving an exemption or homestead credit. Also, there may be a partial assessment or no assessment on any recent improvements. Also, the property may not have been inspected for some time. Depending upon the circumstances, the property taxes could increase significantly if the property assessment becomes adjusted to market value.

If the assessment is higher than your estimate, it may be that your estimate is subject to assumption of special assessments. Otherwise you may want to contact your city or township assessor and have your assessment reviewed.

Cass County Government
211 9th Street South • P.O. Box 2806 • Fargo, ND 58108