Property tax hike warning sounded

Assessor says some entities want to raise rates by 11 percent

KINGMAN - An organization that wants to limit property taxes in Arizona, recently issued a news release warning residents to be on the lookout for a 10-percent increase in their primary property taxes.

Mohave County could see an 11-percent increase in the budgets of some primary property taxing entities, said County Assessor Ron Nicholson.

There is probably nothing more confusing than property taxes. There are primary and secondary property taxes, full cash value, limited property values and different tax rates for the county, the college, schools, fire districts and improvement districts. Primary property taxes include the college, the county, the library district, the flood control district and the TV district, he said. These taxes are based off of the assessed limited property value.

However, the college and county are limited by Proposition 101 and can only increase their budgets by 2 percent per year.

The limited property value is usually below the full cash value or market value of a property, Nicholson said.

By state statute, limited property value is increased by 10 percent a year until it reaches the full cash value of a property. Then it stops until the full cash value of the property increases again. It can also drop if the full cash value of a property drops.

Catching up

Limited property values have not yet caught up with the decrease in full cash values, Nicholson said. He believes limited and full cash property values may catch up with each other next year, depending on the market.

But this year, Mohave County residents may see an 11-percent increase in the budgets of the library, TV and flood control districts since the tax rates for these districts stayed the same as last year, he said.

Residents may see a decrease in their assessed full cash (or market) values of their properties this year, Nicholson said. He has lowered the full cash value of property in the county by nearly 35 percent over the last two years, he said.

Secondary property taxes are based off of full cash values, he said. These taxes include schools, fire districts, bonding, improvement districts - in short, any taxing entity that is approved by a vote of the people, Nicholson said.

However, just because the full cash value of a property goes down does not mean the secondary property taxes tied to that property will go down.

Setting rates

Secondary property taxing entities set their own tax rates, which are approved by the Board of Supervisors every year, Nicholson said. Unlike the college and the county, most secondary property taxing districts are not capped at a certain growth rate. Schools have a formula which they follow in order to generate their tax rate.

Therefore, a secondary property tax district, such as an improvement district, could increase its tax rate in order to avoid a decrease in its budget due to the decrease in the full cash value of property in the county.

Mohave County property owners can check their property tax bills online at the County Treasurer's Office Web site, www.co.mohave.az.us. Click on the "department" link and then on the "Treasurer" link.