FY17-18 PUBLIC HEARING AND APPROVAL OF FISCAL YEAR 2017-18 PROPERTY TAX LEVY
Staff Contact: Vicki Rios, Director, Budget and Finance
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Purpose and Policy Recommendation
This is a request for City Council to conduct a public hearing on the proposed Fiscal Year 2017-2018 (FY17-18) property tax levy and, by a roll call vote, approve a motion to adopt the property tax levy that will be assessed by ordinance on June 27, 2017.
Background
Arizona's property tax system consists of two tiers - Primary and Secondary. The primary property tax levy has state mandated maximum limits; however, it can be used by a city for any purpose. The primary property tax revenue is included in the General Fund's operating budget. The secondary property tax levy is not limited; however, it can be used only to retire the principle, interest, and related fees on voter authorized bonds used to finance the city's capital improvement plan. Arizona state law requires Council to set the property tax levy by the third Monday in August.
Analysis
City Council reviewed the FY17-18 Tentative Budget and adopted a resolution formally approving the tentative operating, capital, debt service, and contingency appropriation budget at the May 23, 2017 voting meeting. The tentative budget assumed the primary property tax rate would decrease from $0.4792per $100 of assessed value for FY 2016-2017 (FY16-17) to $0.4632 per $100 of assessed value for FY 2017-2018 (FY17-18). In addition, the tentative budget assumed the secondary property tax rate would decrease from $1.6698 per $100 of assessed value for FY16-17 to $1.6140 per $100 of assessed value for FY17-18.
If Council approves this item, the total property tax rate will decrease from $2.1490 to $2.0772. The total of the levy will increase slightly but this is due only to the value of new construction added to the city during the prior year. This allows the city to reduce the tax rates slightly and does not require a truth in taxation hearing. Co...
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