Here’s why property taxes vary so much from city to city

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Property taxes can be a major expense for households, and several factors may affect the size of the bill, research shows.

These levies, which typically fund public services, such as K-12 education, police and firefighters, can be tough to compare across jurisdictions.

But there are four key reasons for differences: property tax reliance, property values, local spending and classification, according to a new report from the Lincoln Institute of Land Policy and Minnesota Center for Fiscal Excellence.

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“In some communities, local residents are willing to pay higher taxes but expect higher spending on things like public parks and a robust public transportation network,” said Katherine Loughead, a senior policy analyst with the Center for State Tax Policy at the Tax Foundation. “In other communities, residents are less interested in the expense of public amenities but instead want to pay lower taxes.”

Property tax is “really instrumental” as a local revenue source, but Loughead stressed that every community has different priorities and budgeting goals.

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