Tax rate proposal
Property owners of Davis County will receive a property tax notice in the next few weeks.
The notice will say Davis School District is proposing a tax increase. An increase is being considered by the Board of Education to maintain $7.8 million in matching funds from the Utah State Legislature. The tax increase varies depending on the value of the home.
The notice will state taxes on a $403,000 home are proposed to increase $183.74 per year. By law, the notice doesn’t incorporate the district’s debt tax rate, which is falling because the district continues to pay off existing debt.
In essence, the proposed tax increase being considered would be an additional $60.95 per year ($5.12 per month) on a $403,000 home.
Frequently Asked Questions
Why is the Davis School District proposing a tax increase?
Because property values are significantly different throughout the state, school funding incorporates an equalization formula. This funding helps to “equalize” property tax revenue amongst school districts so that a child’s education is not based on where they live. In order to maintain this state equalization funding, every five years, the District must achieve minimum levels of tax effort or they begin to lose state funding. The proposed tax increase returns the District to these minimum levels and averts a $7.8 million loss of state revenue for school year 2021-22. This tax rate increase raises taxes on a $403,000 home by $183.74 per year.
What is the $7.8 million going to be used for?
As part of the District negotiation process, all school teachers with three or more years of teaching, will receive an additional $1,500 on their annual salary. Other District employee groups did receive a salary increase but did not receive the $1,500 as teachers did. This increase for teachers is funded by the $7.8 million raised by the proposed tax increase.
What does the debt service offset to taxes mean?
The debt service tax rate generates funds for debt payments associated with voter-approved bonds issued by the District. Because the School Board has paid down debt and is not issuing any new bonds, the District can lower the tax rate. This debt rate deduction lowers taxes on a $403,000 home by $122.79. Therefore, the overall increase is $60.95 per year or $5.12 per month.
What happens at the Truth in Taxation hearing on August 3?
The truth in taxation hearing is a public meeting for all Davis County residents. All citizens wishing to express their thoughts on the tax increase will have the opportunity to address the Board of Education of the Davis School District. After the public comment period, the school board will consider a final tax rate for the 2021-22 school year.