State Capitol News
3:20 pm
Thu August 13, 2009

Lack of a budget means higher property taxes

Phoenix, AZ – The inability of lawmakers to enact a new budget will have some
fallout: higher property taxes. Arizona Public Radio's Howard
Fischer explains why.

Three years ago lawmakers suspended the state property tax,
formally known as the county equalization rate, as part of budget
deal. But the tax returns automatically this year unless
lawmakers and the governor agree to permanent repeal. A bill to
do that went to Gov. Jan Brewer last month. She vetoed it because
lawmakers didn't give her the rest of what she wanted, notably a
vote on higher sales taxes. Lawmakers have since reenacted the
provision. But the bill can't get to Brewer by Monday. That's
important because that's the day county supervisors have to set
all the property tax rates. And Jennifer Sweeney of the Arizona
Association of Counties said there's no leeway to account for
legislative delay.

"The statute is pretty clear. There's not a lot of room for
interpretation of that particular section. And there's another
section that says that the equalization rate has to be levied at
the same time as other taxes, which is what ties that rate to
that same date."

On a $200,000 home the additional levy will add about $66 a year
to the tax bill. But businesses, assessed at a different rate for
tax purposes, will face a bigger hit. Lawmakers and the
governor's office are exploring ways the tax can be refunded --
if a budget deal eventually is reached.