What role does local municipalities play concerning real property taxes?

Local municipalities play a crucial role in the administration of real property taxes, particularly through the levying of ad valorem taxes, which are taxes based on the assessed value of the property. Ad valorem, a Latin term meaning "according to value," indicates that the tax imposed is based on the appraised value of real estate. This means the municipality determines how much tax applies to a property after assessing its value.

While municipalities do assess properties, collect taxes, and set tax rates, the specific role most directly aligned with the definition and function of ad valorem taxes is the act of levying them. This process involves putting the tax amount into effect based on the determined value, making it a critical function of local government in the context of real estate transactions and property ownership. The effective implementation of ad valorem taxes is essential as it provides the funding necessary for local public services and infrastructure projects, which are vital for the community's needs. Understanding this role emphasizes the interconnectedness of property valuation and taxation within local government functions.