It is an interesting dilemma to pay property taxes to fund a government whose expenditures are outstripping inflation by such a great margin.
In one conservative estimate, the buying power of a dollar in 2015 would now take about $1.37 to duplicate in 2025. So, according to this data, things are costing 37% more now than 10 years ago. Most of our incomes have not gone up that much. Many traditional residents of Wasatch County are feeling more strapped trying to make ends meet.
Tax on a home would need to increase by 35% over the last decade for tax paid to government groups to be able to keep pace with inflation. Homeowners on fixed incomes or have income that is not keeping pace with the inflation rate would find even average inflation-adjusted property taxes hard to handle.
So why have taxes on homes increased more than 80% in our county over the same 10-year period?
The dirty little secret of property taxes is that when values of homes go up faster than inflation (as they most definitely have in Wasatch County over the past 10 years) the homeowner’s tax, which is a percentage of the home’s value, automatically goes up correspondently as well, without any designated “tax increase.”
So if government costs go up 37% in 10 years with inflation, and the income they take in from the property taxes goes up 80%, what are they doing with the extra 43% windfall in property taxes?
On top of this automatic property tax increases, there seem to be groups always petitioning for a bigger percentage of our home values to be taxed. School districts, parks and recreation departments, open space proponents, government departments and others authorized to get a certain percentage of our property taxes come up with endless reasons to raise taxes and take out bonds that will “only cost a the average homeowner x dollars a year.”
These requests are often for “nice” things, but hold on. … Why not use some of the windfall of 43% over inflation property taxes to fund them?
Governments might be a little like teenagers. If Dad gives them some money to buy certain things and cover certain of their expenses, and they get to the end of the year what do they do with any extra money? “Use it or lose it” is the oft heard battle cry.
I have heard conversations in government departments expressing fears that if they return any extra money, it might result in a lower budget allowance for the next year. Every department has been wanting a new truck or a new secretary or a better building. and voila the windfall is used up. If and when property values stay flat instead of increasing as fast as inflation, taxing entities like a teenager will cry out for a higher piece of the home value pie.
With home prices (and property taxes) steeply escalating at a faster pace than inflation, government should feel a little guilty keeping this huge property tax windfall. We as homeowners and renters need to understand what is happening to us and stand up for more fair tax policy, especially during this time of such growth in home taxable values.
- We should demand that government spending and property taxation only grow as fast as inflation, plus fees and revenues collected from new developed property.
- We should demand to know what has happened to the windfall. It seems like a crime.
Scott Brubaker
Midway