Saturday, September 3, 2011

Higher tax bills may surprise Chandler homeowners

When the Chandler City Council recently raised the municipal property-tax rate for the first time in 17 years, Mayor Jay Tibshraeny said residents would be paying less - not more - because real-estate values have declined so much.

As Maricopa County begins mailing tax bills this week officials are saying that the average homeowner will be paying $60 less than last year even though the Board of Supervisors also raised the county tax rate.

But that's not true for everyone, and a spot check of the tax bills on the Maricopa County Treasurer's website shows many Chandler property owners will get unpleasant surprises in their mailboxes soon: higher tax bills.

Assurances that the bills would go down in spite of rate increases may not have taken into account that the city and county taxes make up only a small portion of the total, and school districts take the biggest bite. They were based on average home values and the percentage that they have declined since last year. When the drop was less than average, bills often increased.

A random check of Chandler properties show city officials were correct in promising lower municipal taxes in spite of the rate increase but total tax bills were frequently higher because of school districts' rate increases. School taxes, including those for Chandler Unified School District and Maricopa County Community College District taxes, represent more than 75 percent of most bills.

Joel Wirth, chief financial officer for CUSD, said school-tax rates are set by legislative formulas, not elected boards. The state has shifted many of the costs of education to homeowners in recent years by cutting programs and halting state funding for school construction. That has forced districts to hold bond elections and go into debt to pay for things formerly funded by the state, he said.

In Chandler's case, voters approved an $84 million bond in November that will be used to for land acquisition, school construction, renovation, equipment, buses and technology upgrades. Property owners will pay it back in their taxes.

"It's obviously a concern," Chandler Councilman Jeff Weninger said of the higher bills; he cast the lone vote against the Chandler rate increase. "In Chandler, we've done a lot of streamlining. I wonder what kind of cuts were made in the county and school districts."

Wirth said the Chandler district has cut $34 million from its budgets during the past three years and said cash-strapped residents have a right to expect belt-tightening in all taxing agencies.

"It's a tough time," he said.

Dennis Strachota, Chandler management services director, said he has always stressed that it is the city's portion of the tax bill that wouldn't go up and that it amounts to "a relatively small portion of the tax bill. Other jurisdictions have responsibility and authority over their own levies."

The good news among the bad: Chandler's higher-priced homes and those in some subdivisions appear to be holding their values better than others, which may account for many of the tax-bill increases, Strachota said.

The increases appear to span all price ranges. A large Fulton Ranch home near Arizona Avenue and Ocotillo Road valued at $1.1 million is getting an $11,124 tax bill - about $500 more than last year. And a $271,000 home in south Chandler's Carino Estates near Queen Creek and Alma School roads will have to pay $2,434, which is $230 more than last year. A $160,000 Sun Lakes home in an unincorporated area south of Chandler will see a $21 tax increase this year. Many have cited the retirement community as an area that has held its home values better than others.

Yet the owner of a Dave Brown subdivision home near Arizona Avenue and Warner Road valued at $100,000 will pay about $50 less than last year. Taxes on a downtown San Marcos Common Townhome will go down by nearly $200. The owner of a vacant commercial plot near the Chandler Municipal Airport will get a bill for $12,561 - nearly $1,000 less than last year.

Chandler Councilman Rick Heumann urges residents to take a close look at their tax bills even though most taxes are paid by mortgage companies and included in the buyers' monthly payments.

"I hope they will see where their money is going rather than just looking at the total," he said.

They also might catch errors like several that were cited by homeowners and city officials over the years where properties are listed in the wrong cities or school districts and are billed incorrectly.

"We should all make sure we're paying what we're supposed to be paying; it all adds up: $10 here, $50 there," Heumann said.

by Edythe Jensen The Arizona Republic Sept. 1, 2011 10:37 AM

Higher tax bills may surprise Chandler homeowners

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