ST. GEORGE — In order to keep up with inflation, the Washington County Water Conservancy District is proposing a property tax increase for 2020. A public hearing on the proposal is set for early December.
Earlier this week, Ed Bowler, the chairman of the water district’s Board of Trustees, told the Washington County Commission the proposed increase was needed in order to keep up with inflation and that the certified tax rate the water district had attached to property taxes will otherwise decrease without a rate adjustment.
The increase would generate an estimated $750,000 of additional annual revenue, Bowler said. Specifically, the water district is planning on a 0.000042 increase in property taxes, which is the same amount water officials adopted last year.
The proposed increase would add $7.57 annually for a home valued at $329,000. The water district’s portion of the county property tax for such a home would go up from $106.76 to $114.33. A business valued at the same rate will see an increase of $13.77, going from $194.11 to $207.88.
If approved by the Board of Trustees as a part of the district’s 2020 budget, the new rate is estimated to generate an additional 7.09% of revenue over last year’s budget.
“That’s pretty modest in terms of the overall scheme of things,” district General Manager Ron Thompson said.
Special service districts within the county like the water district are allowed to collect property taxes based on a certified rate. While that rate is adjusted annually to account for a general increase in property value and growth across the county when that occurs, it does not adjust for inflation.
This has led to the water district’s certified rate decreasing as property values increase. In order to counter this, the water district is pushing for a tax increase through the truth in taxation process.
The district’s current certified rate is 0.000590, with the proposed increase moving that up to 0.000632. Because the increase is under the district’s maximum allowable tax limit of 0.001, it doesn’t require a public vote to pass. The proposed increase will nonetheless be subject to a public hearing before the Board of Trustees set for Dec. 4.
Property taxes are seen as a stable source of revenue for the various projects and programs that the water district is involved in and pursuing, Bowler told the county commission.
While a portion goes to help fund water infrastructure projects like the Sand Hollow Pipeline and the proposed Ash Creek Project and Lake Powell Pipeline, it is also applied to programs related to drought control, endangered species protection, water conservation, public safety applications, water shed protection and water quality testing, among others.
Property taxes are only a piece of the puzzle in how the water district funds capital projects and programs, Thompson said.
Property taxes make up 10% of the funds, while 15% comes from water rates and 75% comes from impact fees. The district sees this funding model as an equitable way to help cover the cost of future projects.
“We’re not putting it all on water rates,” Thompson said, noting that the tax plan spreads out the cost among all users and industries that benefit from water use.
In the past, groups opposed to the how the district manages the county’s water, and moreover its advocacy for the Lake Powell Pipeline, have accused the district of using impact fees to subsidize the true cost of water for the end user. Doing so provides no incentive for water users to conserve water due to how cheap it is from the district, opponents argue.
Thompson countered this argument by explaining how the water district uses the property tax to help defer the expenses of infrastructure and other projects rather than dropping it all on the existing water users.
If approved, the proposed property tax increase will be the fourth implemented by the water district over the last 30 years. The most recent increase occurred in 2018, with the others taking place in 2005 and 1989.
“It’s a very modest increase,” Thompson said. “It’s for the most important commodity we have in our society – water. It’s a small price to pay.”
The public hearing on the matter will be held Dec. 4 at 6 p.m. during a meeting of the water district’s Board of Trustees at the Washington County Conservancy District building, 533 E. Waterworks Drive, St. George.
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