A mill is one-thousandth of a dollar ($0.001). A mill levy (or millage rate) is the number of mills applied per dollar of assessed value to calculate your property tax. If your mill levy is 50 mills and your assessed value is $200,000, your tax is $200,000 × 0.050 = $10,000.
How Mill Levies Are Set
Mill levies are set by each taxing jurisdiction — your county, school district, city, and special districts — through their annual budget process. Each jurisdiction determines how much revenue it needs, divides by the total assessed value in its jurisdiction, and arrives at a mill levy. When assessed values rise, jurisdictions often lower their mill levy to collect the same revenue — or keep it the same to collect more.
Key insight: When your assessed value goes up, your tax bill may not go up by the same percentage — because the mill levy may be adjusted downward. But if your assessed value goes up more than the average in your jurisdiction, you're paying a larger share of the total tax burden.
Who Sets the Mill Levy?
| Jurisdiction | Who Approves the Levy | Typical Share of Total Bill |
|---|---|---|
| County | County commissioners/supervisors | 15–25% |
| School District | School board | 40–60% |
| City/Municipality | City council | 10–20% |
| Special Districts | District board | 5–15% |
Mill Levy vs. Assessment Ratio
The mill levy is applied to the assessed value, not the market value. In states with fractional assessment ratios, a high mill levy can still result in a low effective tax rate. For example, Alabama has a nominal mill levy of 40 mills but an assessment ratio of 10% for residential property, resulting in an effective rate of only 0.4%.
Can You Appeal the Mill Levy?
No — the mill levy is a legislative act set by elected officials. You cannot appeal the mill levy through the property tax appeal process. You can only appeal your assessed value. However, you can advocate for lower mill levies through the political process — attending school board meetings, county commissioner meetings, and voting in local elections.
The most effective way to lower your property tax bill is to lower your assessed value through an appeal. Even a 10% reduction in assessed value produces a 10% reduction in your tax bill, regardless of the mill levy.