College District Tax Rate Decreases, But Higher Valuations Will Raise Tax Bills

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By Tammy Gray-Searles
    A decrease in primary and secondary property tax rates was approved by the Navajo County College District Governing Board Tuesday, but the decrease will not be realized by most Navajo County homeowners due to increases in the assessed value of their property.
    Northland Pioneer College (NPC) Vice President for Administrative Services Blaine Hatch explained that even though the amount being collected is being decreased from $1.2257 per $100 of assessed valuation to $1.1719 per $100, because assessed values are going up, most homeowners will pay more property taxes this year than last, and the college will collect more funds than last year.
    An NPC press release notes, “The 4.4 percent decrease in the primary tax rate will raise an additional $688,508 in revenue due to new construction and increases in the county valuation estimates.”
    Hatch explained that because of the rate of new construction in Navajo County and the increased value of existing homes, a lower tax rate can still raise enough revenues for the college.
    Under truth in taxation laws, the governing board was required to post notices and hold a public hearing since, even with a decrease in the rate, most property owners will be paying higher taxes this year. The reduction in the rate is expected to cost Navajo County homeowners an additional $2.30 per $100,000 of assessed valuation. For example, according to Hatch, an owner-occupied residence valued at $100,000 last year would have previously been taxed a total of $114.89 over the course of the year, but in the upcoming year will be taxed an estimated total of $117.19.
    NPC documents note that the college's proposed 2008-09 budget “reflects a decrease in the primary property tax rate from $1.2257 to $1.1719 per $100 net assessed valuation. Under the state's truth in taxation statutes, the rate actually increases from $1.1489 to $1.1719.”
    During the 2007-08 fiscal year, NPC collected an estimated $9,956,536 in primary property taxes. With the changes, the college expects to collect $10,645,044 in the upcoming fiscal year.
    The college’s secondary property tax rate was decreased by 1.2 cents, from $1.4206 to $1.3548 per $100 of assessed valuation. Proceeds from the secondary property tax are used to repay capital improvement bonds that were previously approved by the voters. NPC collected the same amount in secondary property taxes as it did primary property taxes last year and expects to do the same again in the upcoming fiscal year, for an increase of 6.9 percent in revenue from both taxes.
    Governing board members also approved the college’s $30.6 million budget for fiscal year 2008-09.
    Expenditures in the budget are up by approximately 6.1 percent over the last fiscal year, in which expenditures totaled approximately $28.9 million.  According to the budget, $24.8 million will be expended through the general fund, which essentially pays for the cost of educational services. The remainder will be spent on capital improvement projects and debt payments.
    In other action May 20, the board:
    * Approved relocation of an overhead power line on the White Mountain Campus in Show Low in order to accommodate future expansion.
    The line will be placed underground at an estimated cost of $70,626.
    * Approved a resolution calling for the election of governing board members for Districts 1, 4 and 5, whose terms expire Dec.  31, 2008. Former Pinetop-Lakeside mayor Ginny Handorff was sworn in as the board’s District 5 representative, and will complete the current term of Neal Thompson, who recently re-signed.
    * Approved renewing membership with the Arizona Community College Association (ACCA).
    The next governing board meeting is scheduled at 11 a.m. on Tuesday, June 17, at the Holbrook Painted Desert Campus on Navajo Blvd. A work session to discuss items on the agenda will begin at 9:30 a.m.