Archive for July 28th, 2009

Looks like your property your Pima County property tax bill is going up….again. I was down at the board of supervisors meeting this morning and got an ear full of angry protesters at the end of their ropes with government taxation. 

From KVOA.com -

By a vote of three to two, the 4.35 percent primary tax increase was approved. For example, for the owner of a $200,000 home, the increase will raise their bill from $635 to $663, an increase of $28 dollars.

I’ve looked at all angles of this one and I’m still not sure how the tax will be implemented but I am sure you and I will pay more. 

Just to bring you all up to speed – There are a number of taxing entities that your property gets taxed by. The list varies by area of town and ranges from Pima County primary and secondary tax rates, to school districts, to flood districts, to fire departments to library districts to city property tax levies.  Deciphering them is not an easy task.

The amount you owe to any of the above starts with the VALUE of your property. The VALUE is determined by the elected Pima County Assessor. Bill Staples, our elected assessor,  pours over recent sales, market trending and comparable properties to match you properties characteristics to those near you. Once the property VALUE is determined then an ASSESSED VALUE is established. The ASSESSED VALUE is what the government entities use as a base to levy the tax.

Steve Emerine, a former Pima County Assessor and deeply missed voice of reason in our community explained that the ASSESSED VALUE is typically 80% to 100% of actual value. Maricopa County set their assessed value at 82% of actual. According to Steve we were in Pima County hovering at 93% of actual value. So movement on this % of actual has income consequences to the community. The higher ASSESSED VALUE is to ACTUAL VALUE the more money coming into the government coffers.

The other variable that government entities have power over is the property tax rate. The rate is the amount they charge you per amount of assessed value, usually $100 increments. In Pima County the primary assessed property tax rate is $3.31 per $100 value. It happens to be one of the largest in the state but that’s a different story.

So taxing entities get increased revenues at least three ways that I can think of:

1. Real Estate values go up.
2. The difference between ACTUAL VALUE and ASSESSED VALUE gets closer
3. The rate per $100 gets adjusted by voter mandate or elected officials.

Today at the Pima County Board of Supervisors meeting, property tax payments by you and me went up. I’m still not certain what actually happened. From what I’ve heard and read the tax rate is actually going down so that leaves and adjustment between assessed value and actual value.  I’ll do more digging tomorrow to verify.  Anyone out there with some insight it would be appreciated.

Breaking news! You’ve heard it here first - Senator Al Melvin, vice chair of AZ Senate Appropriations broke the news on this mornings WakeUpTucson show that a potential deal has been struck with  Govenor Brewer on the budget impass. The details are as follows:

The voters will get an up or down vote on all of the following. The items will not be individually voted on but the voters must up or down the entire package:

The package will be called the Arizona Budget Recovery Plan

- A sales tax increase (a sticking point for the Gov.) which would be 1 cent for year one, .3/4 of a cent year two and 1/2 of a cent year three. The Governor wanted 1 cent for all three years.

- Suspend the Prop 105 voter approved mandates to increased spending on education and many other state programs.

- Permanent repeal of the $250 million commercial property tax assessment.

- 2012 reduction of $200 million in personal income tax

- 2012 reduction of $200 million in corporate income tax.

Arizona’s corporate tax burden ranking nationally will move from 23rd to 7th.  Maybe that will bring in some new businesses and revenue…..from California!

The hits just keep on coming in the Texas v California debate. I love the fact that the Texas legislature only meets in odd number years and for 140 days at a time. If they aren’t meeting they can’t pass laws. From Tom Patterson of the  The East Valley Tribune:

Why does Texas thrive while California flounders? Gov. Rick Perry sums up the Texas philosophy as “Don’t spend all the money.” This governor, unlike the tax-and-spendaholic Gov. Arnold Schwarzenegger of California, added to his hard-line reputation by recently vetoing a pre-kindergarten spending bill. While California grovels for money, Texas recently turned down a $556 million unemployment fund subsidy from the feds because the expensive strings attached would have boosted state spending long after the “stimulus” money left.

Spending discipline is the key to Texas’ low, economy-boosting taxes. Not only do Texans lack steeply progressive taxes, they pay no state income tax at all.

Yet somehow, in spite of a penurious government, the state not only survives but prospers. As Perry explains, economies grow when governments “don’t spend all the money, keep taxes low, have a fair and predictable regulatory climate, keep frivolous lawsuits to a minimum and fund an accountable education system . . . then get the hell out of the way and let the private sector do what the private sector does best.”

Even Perry admits that’s easier said than done. In Texas, government is intentionally hobbled. The constitution permits only limited, specific powers. The governor’s powers are few and he must share authority with the lieutenant governor. Legislators’ salaries are a measly $7,200. The Texas Legislature meets only in odd-numbered years with a firm limit of 140 days. California legislators are the nation’s highest paid and they meet year-round. Texas’ state government is simply not able to be as intrusive and oppressive as are many other states.

The moment of truth for Texas came after the 2002 election, when outgoing Democrats went on a spending binge that left the state with a $10 billion deficit. Many clamored for a tax increase (sound familiar?), but Perry told the Legislature to not bother sending him one. Instead, they made deep across-the-board spending cuts. The results speak for themselves. Today, Texas has a $9 billion surplus to help it through the revenue shortfall all states are experiencing.

Now Arizona is facing crunch time. We can continue the tax-and-spend slide into economic decline. Let’s hope our leaders make the tough decisions that will keep our private sector strong and eventually get us out of this morass.