Municipal Tax Burden On CH Residents Among the Lowest in the State

Municipal Tax Burden On CH Residents Among the Lowest in the State
Posted on 10/07/2015

By Mayor Kelvyn Cullimore Jr.

'Tis the season for property tax notices.  Every August, all property owners in Cottonwood Heights receive their annual property tax notice.  The value of your property is determined by the county assessor.  The tax rates applied to the value of your property are set by each jurisdiction (city, school, county, etc.) and overseen by the State Tax Commission.  Those rates are calculated to yield tax revenues to the taxing entity roughly equivalent to the taxes paid the prior year - unless the taxing entity is imposing a tax increase.  Those imposing a tax increase are identified on your tax notice and the time and date of the hearing on the proposed tax increase is also shown on your tax notice. 

If your property tax is not roughly equivalent to what you paid last year, and there are no taxing entities imposing a tax increase, it means that the county assessor has changed the value of your home beyond the average increase or decrease for the area..  The opportunity to appeal the valuation of your home ran from Aug. 1, 2015 to Sept. 15, 2015.  There are exceptions for a late appeal listed on the county website at www.slco.org/property-tax

We are pleased to report that for the eleventh straight year (since we incorporated) there will be no increase in property taxes imposed by Cottonwood Heights. 

In July 2015, the Utah Taxpayers Association published their 2015 Cost of City Governments based on fiscal year 2014 data.  In this report, the Taxpayers Association attempted to provide an equalized look at what residents paid for their city government in the 50 largest cities in Utah.  They state in the opening paragraph of their report that, “This data provides a snapshot of on average how much of each thousand dollars earned by a citizen is consumed by the city government in Utah.”  

The report goes on to say, “This report systematically compares how well elected officials in Utah’s cities control public spending and illustrates the relationship between government as a service provider and citizens as consumers.”  The report ranked the 50 largest cities and compared how much citizens paid per thousand dollars of income for city government and how much tax revenue per capita each city received.  Cottonwood Heights ranked 21st in population among the 50 largest cities in the state with a population of 34,238.  The average population of the 50 cities was 42,588 and the median was 29,815.  We were just about in the middle. 

The report calculates that the average amount per thousand dollars of income that Utah residents in these 50 largest cities paid for municipal government and services was $25 or 2.5%.  According to the report, Cottonwood Heights residents paid $11.49, or less than half the average.  The only city where residents paid less was Riverton.  We ranked as second lowest among the 50 largest cities.  An argument could be made that Cottonwood Heights should have been the lowest because our residents do not pay extra taxes for fire and police services as the residents of Riverton do.  In other words, this report looked only at tax revenues taken in by the city.  Riverton residents pay taxes to service districts, not the city, for police and fire so those taxes are not included in the Riverton tax revenue calculated in this report.  Therefore, arguably, Cottonwood Heights residents paid the lowest percentage of their income for municipal government of any of the 50 largest cities in the state according to this report.  

Cottonwood Heights ranked second highest in per capita income of the fifty largest cities reporting in at $36,668.  This is considerably higher than the average of $23,707 for all 50 cities in the report.  The fact that our per capita income was so high explains, in part, why we were so low when considering tax revenue the city receives as a factor of per capita income.  It does not, however, negate the fact that Cottonwood Heights residents paid less of their income for city taxes than virtually any other city in the state.  

Examining tax revenue on a per capita basis takes into account the amount of tax revenue the city receives divided by the number of residents.   The fifty largest cities received on average $568 in tax revenue per capita during the period covered by this report.  Cottonwood Heights received $421 in tax revenue per capita which was well below the average.  It ranked us as the 11th lowest in per capita tax revenue of the 50 cities included in this report.  However, it should be noted that, like Riverton, three of the 10 cities that were lower also paid separate taxes to a service district for fire services not included in their city budgets and two paid extra to a service district for police services that were not in their city budget.  Arguably, that would have moved Cottonwood Heights up to 8th lowest among the 50 largest cities.  Whether we were ranked 8th lowest or 11th lowest, we were still at the very low end of the scale.  

We are pleased that Cottonwood Heights residents paid the least amount of taxes per thousand dollars of income for municipal government of virtually any other city in the state and that our per capita taxation rates were also among the lowest in the state according to this report.  As you pay your property tax this year, please rest assured that we as city leaders are committed to being fiscally responsible.  We understand the need to balance taxes assessed with the service levels our residents have come to expect.  We appreciate reports like this from the Utah Taxpayers Association that tend to validate that our fiscal policies are effective. 

If you would like to read the entire report, it can be found online at http://www.utahtaxpayers.org/wp-content/uploads/2015/07/Final-City-Cost-of-Government-Report-2015.pdf.