A striking disparity between rural and urban property tax rates

This New York Times feature on "Great Homes and Destinations" caught my eye this morning because it feature a property in rural Arkansas. Indeed, as is typical of the series, it features three homes in the same price range; today's it's $545,000. Two of the properties are one-bedroom apartments in major cities--Boston and Washington, DC, and the third is a four-bedroom house in Botkingburg, in north central Arkansas. The description of the latter reads, in part:

This house is at the end of a four-mile-long gravel road in a rural part of the Ozarks in north-central Arkansas. The surroundings are wooded and remote. The town of Clinton, which has the nearest grocery store, hospital and library, is about 25 minutes away.

Botkinburg is not even a Census Designated Place, but Clinton's population is 2,362, and it is the county seat of Van Buren County is 16,411.

Interesting. I am thinking the market for houses like this must be very limited, and the asking price seems awfully high for an 1,800 square foot house with just 1.5 baths.

But what really struck me about this real estate feature was the whopping disparity in property taxes levied on these three homes, all in the same price range. While taxes on the Boston Back Bay one-bedroom, 665-square foot apartment are $5,400.65 a year, taxes on the more spacious (1278 square foot) DC loft are slightly lower at $4,669.31 a year. (Homeowners dues on both properties exceed are in the $200-$300/month range). Compare that with a shockingly low $315 annual property tax bill on the five acres in Arkansas with the four bedroom house!

Of course, residents of Boston and Washington, DC, presumably get many more services for the property taxes they pay, but this stunning disparity in property tax bills on properties of the same value points up a couple of things--one being how few services county governments like the one in Arkansas can afford to deliver because of the paltry property taxes they levy. With just about 16,000 residents and property tax rates this low, it is amazing that county raises enough revenue even to pay the salaries of the constitutionally mandated county officials.

I have written about some of the legal consequences created by such poorly funded county governments here and here.