CH Tax Burden Still Among Lowest in The State

CH Tax Burden Still Among Lowest in The State
Posted on 08/31/2016

By Mayor Kelvyn Cullimore

Every August, Salt Lake County sends out tax notices to property owners in the county.  As a result, I usually take this opportunity to address property taxes as they pertain to residents of Cottonwood Heights. I hope to educate and provide perspective relative to the property taxes you pay. 

As a city, we strive to provide a high level of services balanced against the cost to provide such services. Among the services your tax dollars pay for are police, fire, road maintenance, animal control, municipal justice court, snow removal, planning and zoning, community events, economic development, operating expenses, and much more. Our largest source of revenue for providing these services is property tax. We receive approximately $6.25 million per year in property taxes. That amount has been constant since we first incorporated in 2005 and has only grown slightly as new construction takes place. 

We are pleased to report that for the twelfth consecutive year since incorporation we have not increased property taxes. 

As a city council we strive to be fiscally constrained in our management of the city and find the least expensive way to provide the highest level of services possible. That fiscal conservatism was recognized by the Utah Taxpayers Association in their annual “Cost of City Government Report” published in July. This report analyzes the taxes and fees assessed by the 50 largest city governments in Utah. According to the report, the average resident of the 50 largest cities in Utah pays $22 of every $1000 of income to local government or 2.2 percent of their income. Cottonwood Heights residents pay, on average, $10.81 per $1000 of income, or 1.1 percent of their income. The report ranks Cottonwood Heights second only to Riverton as being the city with the lowest cost of government per thousand dollars of resident income among the 50 cities surveyed.  We are proud to be a “silver medalist” in this category. 

City revenues typically remain flat annually. Even so, our costs continue to rise. In order to meet all anticipated future needs of supporting infrastructure, providing high levels of service and competitive pay to our employees, it will be necessary to find new and creative ways to generate resources to meet these needs. In doing so, we will continue to implement fiscally conservative principles in managing the affairs of the city. 

If your property taxes have increased this year, it is due to several factors. For instance, in reviewing my own tax notice, there are two taxing entities that indicate they are raising taxes this year. The first is the Central Utah Water Conservancy District, which is proposing a 4 percent tax increase.  The other is Salt Lake County, which is proposing a 5 percent tax increase.  Since these entities are only two of thirteen taxing entities assessing property tax on my home, the overall impact on my taxes is negligible. 

Another reason why your property taxes may have increased is that the county assessor raised the assessed value of your home. If you believe your home has been overvalued, you have a right to appeal that valuation. Those appeals must be submitted to the county no later than September 15, 2016. For more information on how to appeal your property value assessment, go to www.slco.org/property-tax. 

Because of rising assessed property values, the tax rate assessed by Cottonwood Heights is the lowest it has been since we incorporated as a city. Because of truth-in-taxation laws, we are only allowed to collect roughly the same amount of tax from year to year. As property values increase, property tax rates decrease.  To collect more tax than the prior year, the city would be required to declare a tax increase and hold public hearings regarding that increase. We have never done that. 

As currently assessed, the taxes you pay to the city of Cottonwood Heights amount to a little less than 15 percent of your total tax bill. The majority of the property taxes you pay go to support Canyons School District. Even so, it is notable that since the Canyons District was formed in 2009, they have not increased property taxes. Incidentally, the Jordan School District bond debt tax assessment, which is a remnant of the school district split, has only six years remaining.  The good news is, that obligation has been shrinking in recent years due in part to refinancing and the overall payment structure of the debt, and it will continue to diminish each year until it is paid in full by 2021. 

You may notice that you are only taxed on 55 percent of the value of your home. Under Utah law there is a 45 percent exemption on a primary residence when calculating the assessable value. That exemption does not apply to commercial properties or to residences that are not your primary residence. With the existence of so much Class A office space at Union Park, Cottonwood Corporate Center and Old Mill Corporate Center comes a significant portion of the city property tax revenues. Appropriate development of commercial properties is a desirable way of broadening the city tax base and subsidizing city services for all residents. 

Being ranked second on the Utah Taxpayers Association list of cities with the lowest percentage of resident income being paid in city taxes and fees is an accomplishment we hope all residents can appreciate. As your city council, we will continue to take seriously the fiduciary responsibility to judiciously allocate the tax dollars you pay in a way that returns the highest benefit we can achieve.

As you review your tax notice, I hope you will be able to see not only a tax bill, but also an investment in your own community and the services you receive.