County says tax hike won't raise taxes
As home values drop, residents will pay less secondary property taxes
KINGMAN - The Mohave County Board of Supervisors sought to assure the public on Monday that they will not pay more in property taxes next year, even as supervisors voted unanimously to raise the county's primary property tax rate by 20 cents for 2010-2011.
The new property tax rate will be set at $1.4637 per $100 of limited assessed value for homes in the county, an increase of 16 percent over the prior year's $1.26 rate, but still well below the $1.75 county residents had been paying for the 16 years prior to 2006.
That year, the passage of the Local Property Tax Levies Act voter referendum, also known as Proposition 101, effectively reset each taxing entity's limit to its actual tax levy, plus an additional 2 percent each year from 2007 on.
At the time, the goal of the referendum was to remove "unused taxing capacity" and to limit local governments' ability to raise property taxes at a time when property values were skyrocketing.
In the years since Proposition 101 passed, Mohave County had seen its property tax fall precipitously - until now, that is.
With the County Assessor's Office catching up with the plummeting property values that followed the 2007-2008 housing market collapse, Deputy County Manager John Timko explained to supervisors that the increase was a means to maintain the county's existing tax levy as authorized by the voters in 2006.
"Since its inception five years ago, the voter-authorized limitations have reduced county tax revenues by $33.9 million from the amount we would've collected by leaving the rate at $1.75, which it had been at from 1997 through 2005," Timko said.
"This year, due to the 8.4 percent decrease in assessed valuation, the Property Tax Oversight Commission's rate calculation requires a rate increase to maintain the statutory 2 percent growth rate."
Timko added that while the increased tax rate would add about $2 million to the county's general fund, other secondary taxing districts such as the TV, flood control, fire and library districts would see their revenues drop by $5.3 million over the same time period, leaving actual county revenues down a net $3.38 million over the previous year, a fact that Supervisor Gary Watson sought to emphasize.
"So, in actuality, when you hear rumors floating throughout (the county) that we are increasing taxes, that is actually a false statement?" Watson asked Timko. "That's correct," Timko replied.
Supervisors also unanimously passed the $267.7 million budget for Fiscal Year 2010-2011, which includes $81.9 million in the general fund, down from the $82.3 million budgeted for 2009-2010. County Manager Ron Walker referred to the budget as a "reality budget," featuring across-the-board spending cuts in anticipation of further state funding sweeps later this year.
"The one thing I think we can look forward to in the immediate economic future is uncertainty," Walker said. "And that uncertainty for us poses a significant threat. In particular, if the state sales tax which was recently enacted doesn't solve the state's budget problem - and personally, I don't think it will - we still have the uncertainty that may go to a certainty that the place the state's going to look to fix their problems is going - they're going to come down and look at us."