Property tax load shifting to homes

If it seems like your property tax burden is getting heavier every year, it is. And experts say if the trend continues, homeowners and small businesses will be paying almost all property taxes and big corporations will be paying next to nothing.

Utah's tax burden has been shifting in the past few years from rich corporations with lawyers and tax consultants to Average Joes with homes and small businesses who pretty much pony up what ever they're told to at tax time.

In the past decade, the centrally assessed businesses, which can include small family-owned operations but tend to be big corporations, have seen their share of the total tax bill decline by 45 percent. At the same time, the total tax share of locally assessed properties increased to 85.9 percent from 74.6 percent, an increase of 15.1 percent.

"There is no question that locally assessed values have exploded with the growth of the number of new properties while at the same time, there are no new large oil discoveries, no new Kennecott mines, no new railroads entering the state," said recognized tax expert and lawyer Mark K. Buchi, a former chairman of the Utah State Tax Commission.

"One of the problems local governments face is that the average citizen thinks taxes are going higher because government is spending more. The reality is that taxes are not going higher, but taxes are being shifted to homeowners," said Brent Gardner, director of Utah Association of Counties. "If centrally assessed properties pay less, you pick up the difference."

Neither economic nor political forces are likely to alter the shift in the foreseeable future, Gardner and other experts say.

Centrally assessed properties include railroads, airlines, mines, gas and oil wells, pipelines and utilities. The state's Property Tax Division puts a value on the centrally assessed properties and the local county treasurer bills and collects the taxes.

The counties association reports that statewide, locally assessed properties had a taxable valuation of $37.3 billion in 1990. Total taxable value for centrally assessed properties in 1990 was $12.7 billion.

Locally assessed properties amounted to 74.6 percent of taxes paid and centrally assessed amounted to 25.4 percent.

By 2000, locally assessed properties were valued at $80.9 billion and accounted for 85.9 percent of property taxes while centrally assessed properties had a total taxable value of $13.2 billion and accounted for 14.1 percent of property taxes.