ST. GEORGE — The Washington County Water Conservancy District is proposing a property tax increase that officials say will translate to an annual cost of nearly $7 for a home valued near $300,000. A public hearing on the proposed increase is set for Wednesday.
This would be the third property tax increase from the water district since 1990, Ed Bowler, chairman of the water district’s board of trustees, told the Washington County Commission during its Nov. 20 meeting. The last increase was in 2005.
The amount the water district is proposing would generate an estimated $650,000 of annual revenue, Bowler said.
Specifically, the amount the water district is asking for is a 0.000042 increase on property taxes, Ron Thompson, water district general manager, said. This would come out to $6.81 on a $291,000 home per year, he said.
It would bump the annual property tax of $97.47 to the water district to $104.39 for a home at the value listed above.
The tax for a commercial property of the same value would increase an additional $12.39 a year to $189.61.
“In terms of cost, it’s pretty insignificant in the big picture,” Thompson said.
If approved as a part of the water district’s 2019 budget, it would increase the district’s property tax revenue by 7 percent above last year.
Water district officials said the increase would offset the fact that rates are not being adjusted for inflation over the years.
The property tax rate is based on what is called the “certified rate,” Thompson said, which applies more to growth than adjusting for the cost of living.
“We set tax rates that applies for new growth, but is not adjusted for inflation,” he said. “So over the years, with no inflation being adjusted, your tax certified rate will continue to drop.”
Overall, property taxes make up 10 percent of the water district’s funding for capital projects. An additional 15 percent comes from water rates while the majority, 75 percent, comes from impact fees.
Thompson said he and the water district’s board of trustees, which includes area mayors and a County Commission member, believe the system they’ve set up to fund the district is “a fair way to tax versus putting it all in water rates.”
The proposed tax increase does have its detractors, among them being the conservation groups Conserve Southwest Utah and the Utah Rivers Council.
Both groups accuse the water district of subsidizing the true cost of water for water users through property taxes, thus keeping the cost artificially low while also doing little to promote efficient water use.
“(Conserve Southwest Utah) opposes the basic concept of a property tax to supplement the price charged for water delivery since these taxes hide the true cost of water and make it difficult for individual homeowners to reap the full benefit of their investments in efficiency,” the group said in a press release.
The Utah Rivers Council has said Utah is unique in using property taxes to to keep the price of water low.
“These taxes are why Utah has America’s cheapest water rates – and why Utah is one of the nation’s most wasteful water users,” the council stated in a press release.
Thompson said there’s nothing “unique” about Utah using property taxes to help cover water district cost. Other western states, including parts of California, do the same, he said.
“Property tax has been a fundamental part of water development in the western United States,” he said. “Almost all of your western states have some sort of tax that goes to providing revenue toward water development. Utah is not unique in that.”
Funding generated by the proposed increase, which would take effect in 2019 if passed by the water board, would go toward water treatment, transmission and development, Thompson said. That includes capital projects the water district has planned over the coming decade.
“Its a fairly modest increase,” he said. “Ultimately we’re going to need to (raise the property tax) to keep up with capital projects.”
The public hearing will be held during a meeting of the water district’s board of trustees at 6 p.m., Wednesday, at the Washington County Conservancy District building, 533 E. Waterworks Drive, St. George.
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