Mohave County government's revenues are not keeping pace with a county that witnessed the highest percentage in population growth of Arizona's 15 counties over the past decade, County Assessor Bev Payne said.
"The expectation is that the growth will support county government – the growth in population – and it doesn't," Payne said.
Payne determined that the county lost more than $30 million in assessed values over the past five years because of severalfactors.
That is the equivalent of removing from the tax rolls 4,049 new homes valued at $80,000 apiece during that time frame.
"My point for this whole thing is there are valid, legal reasons that the taxable value of growth does not match the growth of the needs for services," she said.
Payne issued a two-page memo on property values and revenues in advance of a meeting of the county supervisors Monday.
During the meeting, the supervisors deadlocked over doubling sales taxes to a half-percent and raising property taxes – now $1.75 per $100 in assessed valuation – by 21.94 cents when they adopted a $150 million budget Monday.
Supervisors Pete Byers, Buster Johnson and Tom Sockwell said they have not had a chance to analyze Payne's memo.
Her assessment apparently is shared in part by County Manager Ron Walker, who has been analyzing the county's financial situation since he started the job May 1.
In a report delivered to the supervisors on July 9, Walker wrote that the growth in county revenues is not keeping up with the increase in population and costs.
The county has been growing by an average of 6.8 percent a year since 1990, Walker wrote.
Census Bureau reported in March that the county's population rose from 93,497 on April 9, 1990, to 155,032 on April 1, 2000.
That growth does not necessarily translate into higher property tax values – and revenues – Payne said.
The county has about 230,000 parcels, but 9,147 of them are exempt in part or in full from taxation.
"Many people wonder, 'What has happened to all the growth? Why hasn't it helped pay the bills for the county?'" Payne wrote.
"My job is to determine the accurate (property) value, not to raise value to help the county budget," she said.
"Sometimes I lower values."
The full cash value rose 95 percent from $4.2 billion to $8.2 billion over the past decade countywide, Payne said.
During the same time frame, net assessed (taxable) value climbed 62 percent.
Payne cited several reasons for the discrepancy.
For one thing, the state Department of Revenue determines the values for mines, utilities, pipelines and railroads – known as centrally valued property - she wrote.
A statewide telecommunications lawsuit in 1996 removed $6.8 million from county coffers.
The loss of revenue was the equivalent of taking 850 of the previously mentioned new homes off the tax rolls, according to Payne.
Those homes are now assessed at $8,000 each.
Payne described the county's sales market as "very dynamic.
You must look at the entire county to see the total picture.
Values are going down in some areas while they are going up in others."
Much of the property from Bullhead City to Mohave Valley has dropped in value because of problems with septic tanks, Payne wrote.
Those values dropped by more than $5.4 million from 1999 to 2000, the equivalent of taking 682 homes off the tax rolls.
Payne also cited a drop exceeding $6.7 million stemming from the growth in property tax exemptions.
That is the akin to taking 842 homes off the rolls.
Home values also have declined in some areas, and manufactured homes usually decrease in value, Payne wrote.
Home sales prices have risen in Kingman over the past year, said Debbie Coleman, executive director of the Kingman/Golden Valley Association of Realtors.
During the first six months of 2000, 272 resale and new homes sold for a median price of $82,000, Coleman said.
The median price for 265 homes sold during the first six months of 2001 was $87,450.
Payne cited a study of remote areas that indicated property values are lower for land with older manufactured homes – assessed at 10 percent – than on vacant property, assessed at 16 percent.
For instance, a vacant lot valued at $10,000 is assessed at $1,600, Payne explained.
If that property had a house on it, the assessed value would drop to $1,000.
Payne said the state Legislature established those rate differences.
"I would say the logic is vacant land belonged to nonresidents, so they could jack their value up and not hear from the voters," Payne said.
She said the Legislature determined the county's tax base.
The Legislature lowered the ratio for centrally valued property from 30 to 25 percent between 1994 and 1999.
At an annual loss of $1.4 million, it is akin to taking 175 homes off the rolls in one year.
The state lawmakers also made changes for commercial personal property by accelerating the depreciation to roughly one-third of normal value for the first year, Payne wrote.