SOUTH PORTLAND — The South Portland City Council raised the curtain on the 2022 budget season with a joint workshop with the school board this week and already the annual real estate revaluation has one official worried about what changes in property values will do to residential tax bills.

“There’s going to be a pretty significant shift,” said City Finance Director Gregory L’Heureux.

L’Heureux presented his concerns to both boards at the joint workshop Jan. 5. Neither board took any action and the first official public hearing is not scheduled until April 6, but L’Heureux said he is already looking to what might happen to commercial and residential property values citywide.

L’Heureux said this week that city officials typically do a revaluation every year to ensure that property values reflect the current market rates. By doing the revaluations annually, L’Heureux said, any adjustments that happen are typically very small.

This year, however, L’Heureux said economic impacts of the coronavirus pandemic have already caused big changes to market values. Companies are going out of business or not serving customers in person and office complexes are being used less with employees working from home. At the same time, he said, more residents are moving to Maine from out of state, thinking Maine is a safer place to live.

“There’s all those dynamics in place now that weren’t there a year ago today,” he said.

The bottom line: For the city to adjust property values in 2021 to match the current market rates, commercial real estate will lose its value, while residential property will go up in value. This means, L’Heureux said, that even if the tax rate doesn’t change at all, homeowners could wind up paying higher tax bills. How much higher is hard to say, L’Heureux told the boards, but both boards need to be prepared now to address the problem.

In response at the meeting, Councilor Katherine Lewis said she understood the challenges but vowed to find a way to make the budget work.

“It’s going to be messy, like it was last year,” she said. “It will be worse this year, probably, with competing values and competing amounts, but, as we are in our own household to get through this, I’m ready to tighten things up here.”