Property tax bills are going up — again — for several Utahns.
You might ask: Wait, aren’t state tax laws supposed to protect against this?
Yes, but they also allow local governments to propose a higher tax rate to generate more revenue to do things like pay for new buildings or increase employee salaries.
And surging real estate prices also are hitting people right in their property tax bill.
Want to know more? Let’s break it down.
Why are my property taxes going way up?
Your property tax bill is most likely going up for at least one of these two reasons:
About 80 taxing entities across the state — from cities and towns to school districts and libraries — are seeking property tax rate hikes this year, so chances are pretty good that one or more of those increases will hit your wallet. Go online to see a table with proposed tax increases.
The valuation of your home could be increasing your bill. Because home values are increasing more than those of commercial properties, homeowners are footing a larger portion of revenue increases.
Why are there public hearings about this?
Utah’s truth-in-taxation law limits the revenue taxing jurisdictions like cities, counties, school districts and water districts can receive. Under the law, a jurisdiction can only receive the amount of revenue it collected the year before, plus taxes from new development.
Those constraints mean tax rates automatically adjust down to offset additional revenue when property values rise.
Alta Mayor Roger Bourke said before a public hearing on the town’s proposed property tax increase that the law means officials fall behind as expenses go up — unless they change the tax rate.
If a taxing jurisdiction wants to create more revenue to pay for new services or items, officials must hold a truth-in-taxation hearing like Alta, population 216, did earlier this month.
The town at the top of Little Cottonwood Canyon proposed and passed a tax rate of 0.001043. That’s 64.25% higher than the certified tax rate and will cost the average homeowner about $425 more a year.
(Francisco Kjolseth | The Salt Lake Tribune) Alta City Clerk Jen Clancy gives a tour of the Community Center, a multiple use room on the second floor of the Alta Post Office on Tuesday, Aug. 15, 2023. Dozens of cities and towns have proposed tax hikes, and Alta hopes to use some of the money to save for a replacement building.
Though Alta’s hearing drew no public comment, the meetings usually put governing bodies in the hot seat and mean officials must explain to the public why they want to raise property tax rates.
They usually attract opposition that prevents — or at least reduces — major tax increases.
Alpine School District’s board, for example, approved a 7.8% increase after frustrated residents packed the board room and said a big increase would mean stretching budgets even more.
That was lower than the double-digit increase initially proposed. It’s also lower than last year’s rate, said Rob Smith, the district’s business administrator — though property taxes could still go up depending on a home’s valuation.
Why are jurisdictions proposing higher tax rates?
Local governments, school districts, water districts and other taxing entities have lots of reasons for bumping up property tax rates.
Alta has specifically cited a $161,000 increase in staff wages to attract and retain employees with competitive salaries.
Bourke also pointed to saving for a new community center.
Pleasant Grove voted to increase property taxes by 14.8%. That’s $56.64 more a year ($4.72 a month) for an average homeowner.
City officials went back 30 years and couldn’t find the last time Pleasant Grove increased property taxes, City Councilman Eric Jensen said.
The increased revenue will help the city add a firefighter and a library employee, increase police wages and build a new park with amenities, including a splash pad and skate park.
(Francisco Kjolseth | The Salt Lake Tribune) Dozens of cities and towns have proposed tax hikes this year. Pleasant Grove plans to use some of that money to help pay bonds funding the development of the Cook Family Park at 800 North and 600 West, pictured Tuesday, Aug. 15, 2023.
Some residents supported the entirety of the increase, while others wanted to see the park — the largest beneficiary of the revenue hike — funded another way.
One resident said he’s in favor of contributing to the city’s efforts to improve quality of life “for a fee of less than half of a Netflix account.”
Another expressed a problem in general with taxes as a burden on those with fixed incomes.
“You get your home paid off, everything’s good, you retire, and your property taxes keep on going up,” he said.
City Councilwoman Dianna Anderson said her property tax bill will go up $63 and the increase is “something that’s very real for each one of us.”
The two largest increases in the state are coming from towns with a combined population of about 1,200.
Goshen, a town of about 980 located on U.S. Highway 6 about 8 miles west of Santaquin, passed a tax increase of 198.6% and intends to use the additional revenue to buy a new fire engine for structure fires.
Wallsburg, a town of about 300 near Deer Creek State Park in Wasatch County, proposed a tax increase of 185.5%.
The notice didn’t include information about plans for the additional revenue. But a document for the public hearing said the $33,000 in additional revenue will increase the budget for street maintenance and repair, maintenance and supplies for the town hall and cemetery and increase pay for public officials and administrative staff.
Are there any mechanisms already in place to protect homeowners when home values suddenly soar?
There are options for homeowners to appeal the valuation of their property.
But nothing in state law automatically caps how much homeowners have to pay when residential property values increase faster than commercial property or other types.
How do I challenge my property valuation?
Homeowners have until Sept. 15 to file an appeal with their county’s board of equalization. That board can agree to lower a property value for homeowners who provide a compelling basis for their appeal.
You can start the appeal process by visiting the website for your county treasurer or assessor. There’s more information about how to file an appeal available on your valuation notice.
What if the county rejects my appeal?
There are still options after a rejected appeal, but they require jumping through more hoops.
The Utah State Tax Commission has a few ways of seeing if counties got property valuations right or wrong. Cases that make it to the commission have a fairly good success rate.
Homeowners can start with an informal hearing, where they tell their story, the county tells its side and a judge decides. They also can waive the informal hearing and go straight to a formal hearing.
There’s also the option of mediation, where a judge helps the homeowner and the county agree on the right property value. People who can’t reach an agreement through mediation can get a new judge and go through a formal hearing.
For people who still don’t get their desired outcome, there’s another set of options.
Homeowners can take the record from their formal hearing and send it to the Utah Supreme Court for review. They also can file the case in state district court.
I can’t afford my property taxes. Now what?
There are multiple options for homeowners who simply can’t afford to pay their property tax bill.
The “circuit breaker” tax relief program is available for homeowners with low incomes. Applications are due to counties by Sept. 1.
Homeowners also can ask their county for an abatement. That process asks elected county leaders to take up to $1,110 from a tax bill for the year and requires homeowners to file a TC-90CY form with the county.
Deferral is also an option for low-income Utahns who are 75 or older the year they apply for a new program. Under this route, taxes add up each year a person defers and come out of the eventual profit from a home sale. This program also requires homeowners to apply with the county by Sept. 1.
