VML  Local Governments Working Together Since 1905
VML Action Call
January 28, 2008

Tax, assessment bills in Senate Finance Committeee Tuesday morning

Call members today in opposition

Several bills that alter the process for setting tax rates, the local budget and assessment notices/tax bills will be heard by the Senate Finance Committee when it meets at 9 a.m. meeting Tuesday, Jan. 29. Please call your member of Senate Finance today in opposition to these bills.

SB 783 requires local governments to determine tax rates before authorizing a spending plan. Currently, local governments have to vote only if the rate increases, even if a reduction still results in higher revenue collections. Under these bills, local governments would have to justify the tax rate and the revenues produced before adopting a spending plan. This bill adds at least 60 days -- probably more -- to the time needed for publication of local tax rates.

SB 779 requires the previous year’s assessment and rate, as well as the rate that would result in flat revenue, and the proposed new rate be added to the public notice requirements. Twenty of 39 cities do not reassess every year, so the notices in these localities would be meaningless. Reassessments in towns depend on the county reassessment process, so this holds particularly true for towns. Only 12 of 95 counties reassess every year. The bill also requires local governments to offer a deferral tax program for owner-occupied primary dwellings. Some localities have tried tax deferral programs, and they have not been popular with residents, who do not wish to have a lien on their property.

SB 789 transfers the burden of proof for assessment increases to local government when increases exceed 20 percent. Currently, homeowners have to prove that an assessment hike is unjustified. The burden would fall on local governments under this proposal when an assessment increase exceeds 20 percent in a single year. Again, this bill would particularly hit local governments hard that do not reassess every year. A 20 percent increase over four years, for example, is only a 5 percent annualized increase. The bill places the burden of proof on the commissioner or the assessor to defend the assessment before the Board of Equalization or the courts, so please make sure that your local government attorney promptly evaluates this bill.

Senate Finance Committee membership and contact information.

Staff contact: Neal Menkes (nmenkes@vml.org); Mary Jo Fields (mfields@vml.org).

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