May 16, 2008
Contact: Pat Dodds, Public Affairs Officer, (480) 312-2336
Truth in Taxation notice published;
City property taxes to remain a fraction of owners’ total tax bill
Scottsdale this week is publishing a Truth in Taxation notice, as required by Arizona state law, which deals solely with the city’s primary property tax levy. The city’s “combined” property tax rate will remain relatively unchanged next year.
About 10 cents of every dollar in property taxes paid by Scottsdale property owners goes to city government, and the remainder goes to public schools, the county, community colleges and various special taxing districts. The other taxing entities may also be required by law to publish “Truth in Taxation” notices to explain changes in the amount of property taxes they collect.
Two types of city property taxes affect owners’ tax bills – primary and secondary – and the Truth in Taxation notice deals only with primary property taxes.
The City Council is set for final adoption of the 2008-09 budget at 5 p.m. on Tuesday, June 3, in the City Hall Kiva, 3939 N. Drinkwater Blvd. A legally required public hearing on the proposed property tax levy will be held immediately prior to the final budget adoption.
Under Arizona’s two-tiered property tax system, primary, or “limited,” property taxes pay for government operations. The secondary, or “unlimited,” property taxes pay for voter-approved bonds. The bonds fund construction of public facilities and infrastructure.
The Scottsdale Financial Services staff estimates that the current primary property tax rate of 38 cents will decrease to about 35 cents per $100 of assessed valuation under the proposed 2008-09 budget. The secondary rate is proposed to increase from 41 cents to just under 44 cents per $100 of assessed valuation in 2008-09. The increase in the secondary property tax levy is primarily attributable to the issuance of $100 million of voter-approved general obligation bonds in April 2008. Voters OK’d the bonds in 2000.
To simplify the calculation for property owners, Scottsdale officials often refer to a “combined” rate that includes both primary and secondary taxes. The Financial Services Department staff projects the city’s combined rate will stay relatively flat at about 79 cents for fiscal year 2008-09. The owner of a home valued at $100,000, for example, would pay about $79 in city property taxes.
The city’s requirement to publish a Truth in Taxation notice is linked to the total amount of primary property taxes expected next year. Although the city’s “primary” property tax rate is decreasing, the total amount of taxes the city will collect is expected to increase in 2008-09 because new construction has been added to the property tax rolls and property values are higher.
The Maricopa County Assessor’s Office determines property values used to calculate tax bills -- not the City of Scottsdale. The effect of the lowered tax rate on each property depends on changes in its assessed value.
Citizens with questions regarding the city property tax rate or other budget issues may contact the Financial Services Department at (480) 312-2437.
The following is a complete text of the legally required “Truth in Taxation” Hearing Notice:
Truth in Taxation Hearing
Notice of Tax Increase
In compliance with section 42-17107, Arizona Revised Statutes, the City of Scottsdale is notifying its property taxpayers of Scottsdale’s intention to raise its primary property taxes over last year’s level. Scottsdale is proposing an increase in primary property taxes of $420,046 or 2.0%.
The proposed tax increase will cause Scottsdale’s primary property taxes on a $100,000 home to increase from $34.65 (total taxes that would be owed without the proposed tax increase) to $35.37 (total proposed taxes including the tax increase).
This proposed increase is exclusive of increased primary property taxes received from new construction. The increase is also exclusive of any changes that may occur from property tax levies for voter approved bonded indebtedness or budget and tax overrides.
All interested citizens are invited to attend the public hearing on the tax increase that is scheduled to be held on Tuesday, June 3, 2008, at 5:00 p.m. at Scottsdale City Hall, 3939 N. Drinkwater Boulevard, Scottsdale, Arizona.