Amid a growing housing crisis in the region, property tax rates and higher home value assessments are concerning residents. San Juan and Emery county homeowners face 21% and 10% increases, respectively, due to the Utah State Tax Commission’s factoring order evaluation this year. At the same time, the Moab City Council is considering a property tax on locals for the first time in 30 years.
On June 15, the San Juan County Commission approved the county’s certified tax rate and a resolution for a tax appeal. The 2021 certified property tax rate ensures that this year’s county revenue will equal the property tax revenue collected in past years, but more important than the rate is the county’s significant increase in estimated home values.
The Utah State Tax Commission’s review of homes in San Juan County found that the assessed value of privately-owned homes in the county have increased at least 21%. Assessed home values in the Spanish Valley neighborhood will increase by a staggering 41%. The dramatic increase represents a larger shift in the county’s property tax burden from industrial properties to home-owning residents.
This year, the Utah State Tax Commission required that homes’ assessed value be evaluated and updated to reflect their market value. The assessed values of “real properties” like homes in San Juan County have increased, while “centrally-assessed” industrial properties supporting oil, gas, mining and utilities have decreased.
Home prices are now notably higher than their assessed values, the Utah State Tax Commission’s “factoring” revealed. The estimated 21% property tax increase is due to the $85 million value increase in locally-assessed properties in the county — including homes — from $454 million in 2020 to $539 million in 2021.
“The market values have gone way, way high based on properties sold in Spanish Valley, Monticello, Blanding, and Bluff,” said San Juan County Assessor Rick Meyer at a meeting on June 22 to set the county’s tax rates. Meyer reported that homes in Spanish Valley, valued at $300,000, have been sold at $600,000.
“We were way, way, way low based on market value,” Meyer continued.
Meanwhile, the value of centrally-assessed properties has decreased from $354 million in 2020 to $323 million in 2021 — a $31 million total decrease. San Juan County Administrator Mack McDonald said that the county’s centrally-assessed properties haven’t been “appraised for multiple years.” The consequence is that property taxes paid by homeowners will increase, while owners of industrial properties will pay less.
The drop in centrally-assessed properties is largely due to the decreased assessed value of Elk Petroleum properties in the Aneth Oil Field, caused by a “decrease in the valuation of oil and gas,” according to former San Juan County Clerk/Auditor John David Nielson. Centrally-assessed properties now account for only 34.3% of the county’s total tax base. Ten years ago, such properties accounted for 65.4% of the county’s total tax base.
Nielson proposed that the county consider other tax revenue sources, such as increasing business, exploring oil and gas opportunities and prioritizing tourism. Ultimately, homeowners and owners of other locally assessed properties will bear the brunt of the county’s taxes. “Continuing to shift the tax burden to the Real Property owners (representing about half of the county’s citizens) is a dangerous trend,” read a report from Nielson.
The San Juan Record reported that at the newly accepted certified tax rate in 2021, a home assessed at a $250,000 value would be taxed $632 in Blanding, $637 in Monticello and $655 in Spanish Valley, where the tax would have been only $488 in 2020. Assessed home values in Blanding will increase by 34%, and Monticello will see a 35% increase.
Changes in other taxing entities in the county, such as health, water and school districts, have not been made yet. Notice of this year’s tax bill is expected to go out in August and will be due on November 30.
Emery County property owners will also face higher taxes this year. The approximate 25% increase is due to a new school bond, lower taxes for centrally-assessed properties and a factor order from the State to the County Assessor.
Similar to San Juan County, the Utah State Tax Commission has lowered taxes this year for centrally-assessed properties and businesses, which shifts the burden from corporations onto residents. The lowered tax rate for businesses means $1 million in lost tax revenue for Emery County, which locals will have to account for.
The factoring order from the state, which found that homes and properties are selling for beyond their assessed value, most significantly affects residents that have two homes or homes that are not primary residences in Emery County. The factoring order increase in Emery County will amount to 10%, compared to 21% in San Juan County.
Amidst these regional property tax increases, Moab is considering tacking on its own. The city has not levied a property tax since 1991 but cites the need for local infrastructure repairs, law enforcement staffing and other city services as justification for the proposed tax.
Some residents have expressed frustration at the notion, wanting to keep the tax burden on Moab’s millions of tourists. City representatives have claimed that sales and use tax revenue — largely shouldered by tourists — is too unpredictable to rely on for funding infrastructure projects and increasing the city’s emergency fund.
But as the region’s increased cost of living threatens to drive out long-time residents, more and more people travel to this corner of the desert in hopes of making it their home. Posts from people seeking housing flood local classifieds on social media, often met with no response.
The housing shortage is not just impacting seasonal labor, but also essential services and institutions. Moab Chief of Police Bret Edge has stated that hiring new officers has been next to impossible because potential recruits can’t find a place to live.
“Moab City has a true shortage of employee housing,” city staff acknowledged in a July 27 agenda item for the city council. “Businesses have had to reduce hours due to the lack of employees. Employers such as the city and the hospital have difficulty hiring employees due to a lack of housing.”
The lack of housing and increasing property taxes in southeastern Utah mirror a larger problem throughout the West, where affordable rental homes for local workers are few and far between while the market for second homes and vacation properties is booming. Whatever the solution may be, property taxes and home values are solidly on the rise — and may change the way of life of many Moabites and other inhabitants of the West.