American Fork Property Tax Rates Have Decreased 3 Years in a Row

This infographic very nearly speaks for itself. But a few notes, if you please.

One candidate is out there saying that our property tax rates just keep going up, year after year. This is not the case.

Learn before you vote

It’s true that someone’s property taxes can go up even if the City’s property tax rate goes down — if the assessed value of the property increases, or if another taxing entity, such as the Alpine School District, increases its rate.

The calculation for primary (first) residences is: multiply the rate by the assessed value of the property, then discount 45 percent. That’s the annual tax on that property.

Here’s your extra credit for the day. Some candidates can’t explain this, but maybe that’s okay, because it’s a little messed up.

The City’s certified tax rate (CTR) is set according to state law. A given year’s rate is the answer to this question: Looking at the same set of properties that was taxed last year, what rate will bring in the same number of dollars (perversely, not adjusted for inflation) as last year, given current valuations?

If the City lowers that rate, it’s a tax cut. If they raise that rate, it’s a tax increase, with special requirements for public notice and such. This is true even if the “increase” produces a rate lower than last year’s, or vice versa. So we sometimes see “increases” in which this year’s rate is lower than last year’s, and we occasionally see “tax cuts” in which the resulting rate is higher than last year’s.

The Utah Legislature calls this “Truth in Taxation,” and yes, it can be Orwellian. The long-term effect in practice is to starve municipal governments of funds, because to raise the rate even slightly, just enough to keep revenues equal in real (inflation-adjusted) dollars — and even if the rate ends up lower than last year’s — is a “tax increase.” And we all know tax increases, real or imagined, are dicey politics for incumbents.

Based on what I’ve heard from the legislation’s authors, this slow strangulation was an intended consequence. It’s clever, and it’s destructive.

Speaking of politics, why do you suppose a challenger running for City office would misreport the facts, saying repeatedly that our property tax rates have increased, when they clearly haven’t?

Want to make a difference? Share this. Before Tuesday. Help others learn before they vote.

 

Here is a longer discussion of certified tax rates, on the off chance that you haven’t had enough already.

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