The numbers can give tax-paying homeowners a case of rate shock.
Several West Valley school districts published truth in taxation notices in today's View announcing minor to seemingly excessive jumps in primary property tax rates.
Tolleson Union High School District residents found out about a 114.5 percent hike, residents in the Buckeye Union High School District were told of a 1,348 percent increase and Saddle Mountain Unified School District officials informed residents in the Tonopah and north Buckeye area about a 2,972 percent jump.
The numbers are staggering, but often false because of a notice state law requires public school districts to publish, education officials say.
"I've always called it partial truth in taxation," said Mike Melton, Buckeye Elementary School District superintendent.
The law requires public school districts to publish notices and hold hearings if they want to raise taxes in several areas without a citizen vote, including excess utilities, desegregation related programs or adjacent ways funding, which is used for roads and sidewalks or to bring utility lines to schools . However, critics of the law's language say it forces the districts to announce huge hikes in property tax rates that might not happen.
"They are getting misinformation and it's very confusing to the public to read that notice and then find out taxes are not really going up - they are going down," said Chuck Essigs, director of governmental relations for the Arizona Association of School Business Officials.
State statute spells out how districts must word the notices and education officials say the notice makes it look like the district is raising an entire tax bill when really the hike represents a percentage of the total primary tax rate.
"The language becomes inaccurate because it looks like it's a tax increase and in many instances it's not a tax increase," Essigs said.
The Arizona Tax Research Association, which wrote and lobbied for the "truth in taxation " bill passed by the state Legislature in 1997, say the public notices are a vital way to inform taxpayers their elected officials are doing something that will increase property taxes. Kevin McCarthy, president of the tax watchdog group, said school districts have the ability to directly tax residents for several funding sources without going to a public vote.
"The only thing you can focus on is the single act; the truth in taxation notice prompts people to at least be notified that these people that we elected are taking some action that is going to affect their property taxes," McCarthy said.
State law requires districts publish the notices before the July 1 start of the fiscal year, to make sure residents have time to comment on the proposed increase before governing boards vote on district budgets. The Maricopa County Board of Supervisors does not set the primary property tax rates for school districts until August. If a district raised a levy in a certain area, adjacent ways for example, it must publish a notice the property tax rates will increase - regardless of whether the district foresees a decrease, a slight increase or a holding in the total primary property tax rate.
"It [the law] doesn't take into account increases in property values, so if you are in a rapidly growing district, they may be budgeting a lot more in adjacent ways because they are building a lot more schools," said Essigs, who spent 18 years as an assistant superintendent in the Mesa school district. "But they really aren't going to pay more taxes - all the new homes and all the new students are going to pay for all the new schools."
Meaning, the state funds districts per student, so with more students comes more money, in part offsetting the adjacent ways costs a district needs to build infrastructure for a new school.
In Buckeye, the high school district notified residents it is proposing a primary property tax levy of $2.6 million, increasing the primary property tax rate from $3.07 to $44.48.
What the notice does not explain is that the money is for an adjacent ways levy for a new high school and comprises a small part of the district's total budget. And, the district saw a 28 percent increase in its assessed value so it expects the overall primary tax rate to decrease this year, Jeff Simmons, the district's financial director, said.
"We don't set the tax rate but everything we do affects the tax rate," Simmons said. "It probably won't increase, but it's not set until August, everything right now is projections."
McCarthy said the notice is accurate.
"If they are increasing their adjacent ways that much, the tax rate will be that much higher than it otherwise might have been," he said.
This year, Simmons included an explanation to be printed with the truth in taxation.
McCarthy said oftentimes when school districts try to explain, they actually make the issue more confusing.
"The law is fairly clear, the law never suggested the final tax rate was going up or down," he said. "They all understand the actions relating to those levies they control. They don't like filing notices, they'd rather not tell people they are raising taxes."
In some cases, a district's budget may include lowering an adjacent ways levy from one year to the next, but it still must publish the notice as an increase. The law requires districts treat adjacent ways as a new tax each year. Agua Fria Union High School District's notice looks like it has a typo for its proposed $2.5 million adjacent ways levy, which will cause an "increase from $55.98 to $50.80."
"By law we have to post it, even though it's decreasing," said Norma Pacheco, the district's director of business services.
The truth in taxation law has been tweaked since it went into effect 10 years ago, however many education officials believe more can be done to explain this part of the complicated world of school finances and make the notices more accurate.
"The concept isn't bad, people ought to know if districts are doing some things in their budget that can increase taxes," Essigs said. "But the way it's set up - it's not always truthful."