Surging real estate prices have given Utah homeowners a lot of reasons to grin — that hefty investment sure is worth a lot more — but it’s also hitting many where they weren’t expecting it: in their property tax bills.
• An education funding law adopted by the Utah Legislature in 2018 is interfering with a mechanism in the state’s truth-in-taxation law from the 1980s, leading to higher payments than you would have to make under normal circumstances. It has affected taxpayers since it passed, but increased valuations have exacerbated the payments this year.
Utah’s housing market is booming, and the value of residential properties shot up exponentially more than commercial properties, many of which are seeing sluggish growth coming out of the COVID-19 pandemic. Note, however, that appreciation only hurt homeowners whose property value grew by more than the median increase in a given jurisdiction.
The town has not raised its property tax rate substantially since at least 1997, Anderson said, and had been siphoning off its reserves to operate. The only thing the new tax rate does is plug a roughly $20,000 hole in the budget. Utah’s capital wants property owners to chip in about 10% more, mostly to cover increased costs and additional employees to meet the rising demand for city services. By absorbing a smaller uptick now,Salt Lake City’s proposed rate would raise property tax payments on the average home by about $90.HB293
The silver lining: This is the final year Utahns will have a rate floor on this line item, unless the Legislature extends it.There are options for homeowners to appeal the valuation of their property, but there is nothing in state law to automatically cap how much you’ll have to pay when residential property values increase faster than other property categories.Lawmakers have just started discussing possible reforms. One aspect that makes reform tricky is the language in the Utah Constitution.