The reductions in Maricopa County property tax rates, as reported Aug. 19 in the Tribune, provide some good news for property taxpayers. Yet, as school district property taxes are affected not only by the school districts but also by the districts’ voters and the state Legislature, it is important for taxpayers to know who contributed to the tax rate declines and who actually inhibited the rates from falling as far as they would have otherwise.
School districts’ secondary property tax rates are essentially voter-determined. These rates will rise or fall as needed so that the amount collected will fund the district’s voter-approved overrides or bond programs. Of the $0.33 average rate decline of the six East Valley school districts included in the Tribune article, $0.12 resulted from declines in the voter-approved secondary rates.
The remaining $0.21 of the average decline resulted from decreases in the districts’ primary rates. While voter decisions determine the secondary rate, the decisions of both the state Legislature and the local school district governing boards determine the primary rate.
The Legislature annually establishes the qualifying tax rate, or QTR. As a result of the truth-in-taxation laws, the Legislature has consistently lowered the QTR to offset increases in property owners’ assessed values. Over the past 10 years, the Legislature has dropped this rate from $4.40 in 1998 to $2.92 for 2008. This year’s $2.92 rate represents a $0.28 decrease below last year’s level in this portion of school districts’ primary tax rate.
The total primary rate of the six East Valley school districts on average declined by only $0.21 due to increases in the locally-controlled portion of the primary rate.
The Gilbert Unified School District increased the locally-controlled portion of the primary rate by $0.40. Higley Unified increased this portion by $0.21 and Mesa Unified increased it by $0.14. The remaining three districts decreased this portion of their district’s primary rate — by $0.33 in Scottsdale Unified, $0.10 in Chandler Unified, and $0.02 in Tempe Elementary.
The locally controlled portion of the primary rate is largest in the Higley Unified School District ($1.10), followed by Tempe Elementary ($0.96) and Mesa Unified ($0.46).