Administrators had suggested the current rate of .008411 be reduced to .08383, the estimated certified rate for the next fiscal year. However, the board rejected that proposal on the grounds that it needed additional tax revenues to keep up with school construction and the costs associated with opening new schools.
“The additional taxes collected will be used to cover the expenses of new schools that are coming on-line as well as for capital expenses,” said Gary Gowans, Tooele County School Board president.
The certified tax rate is the rate set by the Utah State Tax Commission, and reflects the rate necessary to raise the same amount of total funds from property taxes as in the previous year, minus tax collected from new growth. As property values increase, the certified tax rate decreases. Implementing the certified tax rate means property owners pay the same amount of taxes each year, and the taxing entity receives the same amount of money each year, plus the increase created by new growth.
By maintaining the tax rate at .008411, the school district will collect more money in taxes from property owners than it did last year, as the assessed value of property in Tooele County is increasing.
The State Tax Commission has ordered the Tooele County assessor to increase the value of all residential land by 25 percent and all residential buildings by 5 percent to bring assessed values within 10 percent of market values.
This means with the tax rate staying the same, the district will collect more money than last year. That will require the district to hold a truth in taxation hearing, at which it will have the opportunity to explain the need for the additional funds to the public.
Prior to the hearing, the county auditor will mail to all property owners a notice that will show how the tax rate will affect their tax payment.
At the .008411 rate, the owner of a residential home assessed at $200,000 paid $925 in property taxes for schools last year. However, if the same home were to be reappraised at $260,000 — a 30 percent increase — the homeowner would pay $1,202 in property taxes for schools this year.
The decision to keep the tax rate the same, instead of lowering it to the certified rate, was not without opposition among board members.
Julia Holt made the initial motion to keep the tax rate the same as last year. Her motion was seconded by Debbie Chapman. Karen Nelson, however, said she felt the budget as presented was sufficient, and introduced an amendment to let the tax rate decrease to the certified amount. Jeff Hogan seconded that amendment.
The amendment failed to pass in a voice vote and the motion to keep the rate the same passed in a voice vote, with a few audible no votes. Gowans said the majority of board members wanted to keep the tax rate constant in order to avoid spikes such as one in 2001, when the rate went from .006695 to .009290.
“With the district in a growth mode, the additional income will help with capital outlay projects, new buildings, and the cost of maintaining those buildings,” Gowans said. “Keeping the tax rate level will help avoid spikes like we have had in the past.”