Definitions of Terms

Tax Capacity:
reflects potential tax bas of local government. Calculated by computing the hypothetical yield from each of several tax sources (income and property tax are two largest taxes) using the statewide average tax rate i.e. what county would have collected if it taxed at the statewide average tax rate.

Education Effort Index:
Calculated by dividing local education appropriation by local wealth and indexing to the State average.Local Wealth includes county assessable base for FY2006 and net taxable income for tax year 2004.