Grand County’s top taxpayer in 2014 has lost about two-thirds of its taxable value in the last three years. But rising values of other properties offset that decline, so most people who pay property taxes will see only a slight bump in the amounts they owe this year, due to increases from the Grand County School District.
The Grand County Treasurer’s Office reported a significant drop this year of about $24.5 million in the taxable values of oil, gas, mining and potash properties that the state assesses. The bulk of that decline – $21.9 million – is due to a plunge in Intrepid Potash’s assessed value, which fell from more than $122.6 million in 2014 to just under $45.39 million in January 2017, according to a county report.
However, all of the properties in Grand County outside Moab, Spanish Valley and Castle Valley were reassessed this year, adding $31.3 million in assessed value, according to Grand County Treasurer Chris Kauffman.
Combine that increase with an improved property tax collection rate of 96 percent last year – along with rising property values – and Kauffman said the end result is that taxpayers won’t notice a big difference on their bills.
“In general, we did see property tax rates go down a little bit, but the school district had their two increases, which brought them up a little bit for most people,” Kauffman said.
Part of that increase is tied to the school district’s voter-approved 2016 property tax levy, which aims to bring employees’ salaries gradually in line with the state average, while boosting support for academic programs. In the past, the district has estimated that owners of a primary residence with an assessed value of $250,000 could expect to pay an additional $27.50 in the first year after the levy’s passage.
Economic gains, office improvements boost collection rate
According to Kauffman, the county’s property tax collection rate increased significantly in recent years, from 92.8 percent in 2014, resulting in a $330,000 savings to taxpayers over two years.
“The better your collection rate is, the less taxes you actually have to ask for,” he said.
Collections of property taxes in Grand County dipped during the Great Recession, Kauffman said, but as the economy recovered, so did the collection rate.
“I think that a general improvement in the economy is one of the main drivers behind it,” he said.
The treasurer’s office also redesigned its property tax notices two years ago, boosting its collection of back taxes owed by adding those amounts to the grand total at the bottom of a taxpayer’s bill.
“What we saw in 2015 was a huge increase in back tax payments,” Kauffman said. “I think that helped the collection rate.”
Kauffman said his office has also tried to make its property tax bills easier to read, placing the due date in a more prominent spot. And in another improvement, taxpayers can now have their property taxes withdrawn automatically from their bank accounts, or their credit and debit cards, by signing up at: www.grandcountyutah.net/850/Payment-Note.
They have the option of paying the full amount once a year, on Nov. 15, or making 10 payments that are spread out over the course of the year.
So far, Kauffman said, about 70 people have signed up for the automatic withdrawals – an increase of about 50 people since this year’s property tax bills were mailed.
“It’s very similar to what options are available to people who are paying their utilities and credit cards and a lot of other bills,” Kauffman said.
The ease of making online payments, he said, is a “win-win” for everybody.
“It’s a convenience for the taxpayers, but it also helps us and our office,” he said. “It’s more efficient.”
This year, one new line item on property tax notices that might stand out to taxpayers is the “Charter School Tax Levy,” although only the name itself turns out to be new.
The existing levy previously appeared on notices under the “School State Basic Levy.” But according to Kauffman, state lawmakers reached the conclusion that taxpayers should know that charter schools receive property taxes, so they separated the two items.
“The legislature decided that we needed to split that out so people could see that part of their money goes to charter schools,” he said. “It’s not a new tax. It’s more about transparency, I guess, in where that money is going.”
The state does not send the money directly to Moab Charter School, Kauffman said, and the charter school does not set the rate.
“There is an office at the state level that sets the rate and disperses the money,” he said.
Rising property values lead to decrease in property tax rates
Generally speaking, property values in Grand County are rising, which leads to a decrease in property tax rates.
This year, Kauffman said, the county reported $38.5 million in new growth from commercial and residential construction.
Grand County Building Official Jeff Whitney said that the demand for overnight rentals and condominiums is driving much of the residential growth.
“Those people pay 100 percent of the taxable value, so as far as county coffers, that is a benefit,” he said.
But Whitney is concerned that the residential development trend is not addressing the ongoing needs for affordable housing and workforce housing.
“That’s kind of a disturbing trend to me,” he said.
The development of hotels has continued to fuel new commercial growth, Whitney said, noting that there are longer-term plans to build a new 220-unit motel, as well as a smaller hotel near City Market.
Far away from Moab’s urban core, the county is also reporting higher valuations around Cisco, Thompson Springs and the Green River area, where properties hadn’t been reassessed in many years.
“There’s not a lot of population (in those areas), but there is a fair amount of land,” Kauffman said.
Grand County Clerk Diana Carroll said the owners of gathering lines that convey oil and gas have all seen the assessed value of their properties go up. For instance, Mid-America Pipeline is now listed as the county’s top taxpayer, with a taxable value that has almost doubled since 2014 to more than $151.3 million, and a property tax bill of $1.54 million.
“The pipeline companies all increased in value,” Carroll said.
At the same time, Intrepid Potash’s diminished value dropped its property tax bill to about $461,247 – down from almost $1.18 million in 2014.
Utah State Tax Commission Natural Resources Section Manager Roger Barth said the taxes are based on the valuation that his office provides. But he said he cannot elaborate on the factors that led to the decline in Intrepid’s assessed valuation.
“The values are what the values are,” Barth said.
Both Carroll and Kauffman tied the drop to lower potash prices, which have tumbled from a high of just under $500 per ton in 2012 to about $218 per ton today, due to excess mining capacity and less demand from farmers.
“Because the price of potash has dropped so much, the value of their business has also dropped,” Carroll said.
“The price of commodities definitely factors into it,” Kauffman said. “It’s not like they tore down two-thirds of their buildings out there.”
Rising local property values offset a big drop in Intrepid Potash’s value
Property taxes are due by Thursday, Nov. 30. For more information, contact the Grand County Treasurer’s Office at 435-259-1338, or go to: grandcountyutah.net/138/Treasurer.
In general, we did see property tax rates go down a little bit, but the school district had their two increases, which brought them up a little bit for most people.