Wednesday, February 6, 2008

"Fair" property taxes with "ability to pay proposed", plus the real story about 3 acre assessments, HB 155 status

Greetings friends and neighbors,

Below is a recent message sent to the "movers and shakers" who lead efforts to revise property taxation, indeed all taxation issues. I lay awake one morning thinking about the most significant problems with our current property tax law and worked on it. This "temporary solution proposal" is the significant relief I think we need in the more immediate or short term (next two years) while a more permanent solution is researched and studied such as acquistion value (purchase price) or baseline taxation.

Let me hear from you if you agree or disagree. And please remember to let the legislature hear from you again this week. Writing a letter to the editor of the Standard Examiner will "kill two birds with one stone."

And finally, the "rest of the story" about what really went down in Committee, as our local Representative sponsored HB 155 was discussed, is found on "page two".

To: "John Dougall" , "Wayne Harper", "Curtis Bramble" , "Wayne Niederhauser" , "Howard Stephenson" , "Dennis Stowell"

Honored legislators,

I know you are very busy now but I would like for you to think about something.

The current "Truth in Taxation System" has many flaws. I will not spend time delineating them as I think you are all aware.

But the most pressing and important concerns are deficiencies in "fairness" and "ability to pay".

And although I think we need our own version of acquisition value or modified acquisition value property taxation, I realize changing the Constitution and implementing AV or baseline could take several years.

So I would like you to consider this and offer it as an interim and more immediate solution.

Base property taxes on State adjusted gross income and charge 2%. In this manner everyone would benefit. Think about it.

Indigent and the poor struggling to get by on $20,000 in Social Security would pay $400. You could repeal the Circuit Breaker safeguard. You can put a stop to Froerer's and now Buttar's "Deferred Property Taxation" nonsense.

Property owners on a fixed income of $50,000 would pay $1,000 and no more. Young couples filing jointly in a rental situation making $72,000 and saving for a down payment on a home would pay $1,440. And it would be "fair" since they probably have kids in public schools. Landlords making $250,000 a year would pay $5,000 in property taxes. "Fair" because he/she has income earning property. The President of the University of Utah Medical Center would pay $10,000 in property taxes since his salary exceeds the limit of $500,000 a year where exemptions kick-in.

No more tax evaders claiming "primary residence" 45% discounts for vacation homes. No more debates or arguments about special interests or exemptions since property taxes simply become an extension of income/education taxes. No more outrage over unfair property taxes with all their "unique" injustices. No squabbles over whether local ordinances require more than one acre and taxing the "luxury" acerage at full market valuations.

This new property tax could be easily collected using the "Education/Income Tax" process. People, knowing their annual incomes, could budget for it and have their property taxes withheld by the state monthly. No more November shock and awe or "sticker shock" from guess work and game playing local governments.

"Other taxing entities" would be funded based upon existing pro rata shares of property taxes collected via the State Tax Commission. State could control expenditures and "Mac-mansion" public building construction and excessive growth in local (County) budgets. They could at long last be could be held in check.

Twenty-nine County assessor's offices could be virtually eliminated to pay for any minor increased responsibilities of the State Tax Commission. This would save taxpayers hundreds of millions of dollars which could be used to help with increased investments in natural resource funding and the bottomless pit of the public school system.

This solution would enable the Real Estate market to take its natural course via supply and demand without impacting property taxation.

Continuing to allow local entities to tax citizens must be considered a dismal failure. Counties and "other taxing agencies" have abused their taxing authority and continue to grossly abuse taxing powers. It is past time to reign them in before all trust and confidence in government is compromised beyond repair.

I hope this idea may be of some use to you in resolving the current problems with "unfair" property taxes which ignore "ability to pay" considerations.


285 S. 7200 E.
Huntsville, UT 84317

House Bill 155 is the one Keith Smith and so many others have been seeking relief from living under the yoke of the three acre minimum Ogden Valley ordinance. They are unfairly having to pay property taxes based on $100,000 and $200,000 an acre full market value "guesswork" and "speculation" by Weber County assessors on the extra two acres without a residential discount.

Oh, and the reason HB 155 is stalled is because its sponsor, Representative Gage Froerer, did not do all his homework. Questions were raised by several during the House Revenue and Taxation Committee on Tuesday. Frank Gardner, with the Utah Association of Counties was only one who wanted to know specifics. Like how much of a tax shift will be bourne by surrounding property owners or people living in other areas of the County.

Each Bill has a basic cost or revenue figure attached which they refer to as a "fiscal note". Yet there was none. This is usually obtained from the analysts in the legislative research department. Representative Hughes said with no cost information for the shift, I think it is too important to move it forward without this important information. Chariman Dougall asked Mr. Gardner to work with the sponsor in an emergency meeting in order to work out the details before the next scheduled meeting early Monday morning.

Yet when the Chairman asked for how much of a "shift" in tax dollars, as did others, only vague and subjective answers like "not great", "it would not be a significant amount", "somewhat minor" and "negligible amount" came from Representative Froerer.

The Committee thus voted to "table" the Bill so that the basic research could be done and a dollar figure less vague and nonspecific could be worked up by legislative research.

And that is the real story Mrs. Loretta Park forgot to report in the Standard Examiner today.


Minor Machman


Anonymous said...

Gage Froerer is one of the most disgusting creatures on the planet. He is either completely in over his head, completely dishonest, or a corrupt realtor republican. Oh wait...

The reason that the three acre issue isn't an issue for him, is because the powers decided to front load the first acre to 230,000. It is impossible to sell the first acre for that amount, so how can it be worth that amount.

It is one thing to have an accurate assessment, and another to let assessors make it up. Right up the road, neighbors' first acre is listed at 80,000. As I am in an area that is land locked, no sales, how did they come up with 230,000.

If I could only be represented by a tax and spend liberal. I have never experienced that in my voting life in Utah. I might be getting some services. My neighborhood is still waiting for snowplows to slightly increase our road width for cars to pass. Oh I'm sorry, the county is probably broke, and they will have to raise my taxes if I want a path and a half of clearing.

Anonymous said...

Now I will certainly concede Gage is a "Realtor Republican" and even a developer, but he is the sponsor of this bill that addresses the 3 acre minimums in Ogden Valley.

It also sounds like a County assessor issue if they are assessing similar properties at 230K and 80K respectively.

Did you appeal your assessment?

Minor Machman said...

I have never done the appeal thing before this year. I, like many, filed by the 17th of November. The County gave us three and a half months to appeal, so I guess it is only fair that I still have not heard back from Weber Co. on the results of my own appeal. I guess they can take the same 3 1/2 months to reply, which puts it at the end of February?

And yes, my "residential land primary" was assessed at $200,000 (first acre) and the adjoining one and one-half acres appraised at $78,000. Illogical that one acre of raw ground is valued at $200,000and the rest of the property is only assessed at $78,000. But that is what Representative Froerer thinks is "fair" and the "right way to go" with "front loading the first acre". This does not pass any logical test or prudent man common law test I ever heard of. It does pass along the hospitable notion that they are undervaluing the extra acerage and putting some of that undervalued value into the 45% discounted acre. And one should at least appreciate that attempt at fairness. But, as I say the current rules the assessors have to play (or choose to play) are the "disease" (fair market value) and we must demand property tax reform to acquisition value based property tax reform. Not "bandaids" on unjust "symptoms" of a very bad tax scheme such as is being proposed by our "representatives".

Anonymous said...

No, I did not appeal this year. After spending hours with the assessor (Doug Larsen), and one of the county commissioners, I didn't think I would be successful. I had appealed a few years earlier, and won. Winning meant I received enough off my taxes to pay for the appraisal. Unfortunately, within two years, an accessor was back at my door (three times in six years) and I went back where I was plus, but this time the property designations were skewed. According to Larson, don't look at the individual evaluations, just look at the total figure. That's what they do!

Forgive me if I sound a little angry and bitter. This three acre fight has been around for years. Prior to Froerer, there was Murray. Murray was going to fix it. Murray fixed it. Blah Blah Blah. I have been fighting this battle for years. I am not hopeful.

I agree with you about the diseases and bandaids. I just am unable to get very excited with their attempt at fairness. I do not have any faith that this crop of legislators can be fair. The disease is them and they will not be able to cure themselves. I wholly believe that the cure has to come from us, and we have to vote them out. And with that vote, be more responsible not to replace one with one. One party rule corrupts (either side). People have become stuck on labels, and are unable to look ahead. We have created this monster because we have faithfully voted one party. What is a fiscal responsible conservative? Have you seen one? I feel like I am stuck in the 80's.

Minor Machman said...

I hear you and agree. About all I can say is I will sign a pledge to voters saying I will not take anything of any value from any business interest or lobbyists. The experts tell me I have to take GOP Party money and some donations from individuals (I suggested $100 only from individuals who are so inclined to contribute) in order to get into office or I will have no chance at all. I accept their advice regrettably. If I can affect campaign finance reforms any regular citizen could run for any office and win without such financial burdens.

I will also sign a pledge to not vote for any tax increase nor any bill which favors developers and realtors (or anyother special interest group) at the expense of others. Always asking what does this mean to the average person, John Q. Public or Joe Sixpack.

I will also commit to joining with the 20 or so in the legislature to reform ethics and do away with the corruption and graft which is killing public confidence and trust of our legislative process.

I am working on a bill of taxpayer expectations we can all agree too. And then use our expectations as principles and as a my solemn oath and bond with taxpayers.

Beyond that, I can not think of much else one man can do. I will have to depend on constituents to guide me as my "lobbyists". Imagine that "citizens" as my primary consultants...not special interests or business lobbyists!

Murray and our current Representative gave lip service to trying to change a tiny piece of the problem which only applies to certain lot size property owners. I would go after changing the entire "Truth in Taxation" system based upon primarily two factors; "fairness" for everyone, and "ability to pay" considerations, again for everyone. It took Howard Jarvis 16 years to get change. I would like to accomplish it in two. Seems fair but it is a real uphill battle to change paradigms in Utah. I think we have to fight these battles both from the outside (with public outcry) and from the inside (by replacing conflicted and corrupt legislators).

Anonymous said...


Sounds like an announcement. Good on you if I'm correct, and good luck. However, people can't change the party from inside. The party changes the people. You "must" take some money from the GOP. It is already tainted money, and then game over.

I hope you are making an announcement, and I hope you run as something other than the majority party. We are so desperate for an honest debate. I'm afraid that there won't be one with one party rule.

Minor Machman said...

I am not wealthy. And the experts tell me I would have to fight off weekly mailings from the incumbent, which costs some bucks.

My daughter is a graphics design professional and could probably do much of the advertisement stuff for free. I will have to pay for postage and printing and it mounts quickly the political experts advise me.

I would run a very frugal campaign, to be certain. But a campaign where I finance it using mostly special interest money and wealthy family members is not in my plans. If you go to or read the papers recently you will see most legislators accept year round "campaign contributions" from special interests, in addition to gifts. And they pay themselves into the hundreds of thousands of dollars for things like (1) money they could have made if not having to be a public servant (2) suits and spouse's dresses (3) the list of rationalizations for graft is creative and near endless... And at the end they get to keep the money in their campaign warchests.

While currently legal, I detest this as paid for influence and access and immortal behavior for someone who volunteers to serve the public. I will not participate, except within what is absolutely necessary to campaign. Any contributions in excess of what is required to frugally gain a seat will be simply returned with many thanks until the next campaign.

And any mysteriously appearing donations without return addresses will be contributed to the little people so bravely publishing blogs, which are the purest form of freedom and communciation and information we currently have available. Many newspapers are reticent to publish information about the Realtor Association due to their substantial advertising revenues from the same sources, for example. None of us should discount the sacrifice and raw effort and courage it takes to run these blogs. I know because of my own personal experience with this very minor blogspot. Those like Rudi and Val E. deserve far more credit than they receive, I can say unequivocally.

I have mixed feelings about running as either a Republican or a Democrat, or as a candidate from any party for that matter. I have always prided myself on being independent, a maverick. For as you suggest, in the State their are those who are very upset about what is happeniing in any party. After talking it over with many, the best strategy is to go inside the belly of the whale and work on the insides for change toward decency and honesty. I expect the Realtor lobby and those most influenced by it, to come out in force, which includes virtually a vast majority of the legislature. Not all luckily, but a significant majority. And I expect to be hammered by this group of people.

So it is with considerable tepidness I have decided to offer myself up for this type of anticipated abuse. But as an ole fighter pilot buddy, nick-named "Nort" used to say, "A faint heart never kissed a billygoat."

If you can suggest a credible way to do this, I am all ears. The experts are telling me that by limiting to GOP Party contribution and individual donations, I am crazy and stand very little chance. But as I say, we have saved for retirement and I can not jeopardize our modest investments in a campaign only to seemingly accept special interest money to repay myself as most others do. That to me personally is grotesque and corrupt behavior. I hope this explains some of my thoughts on the matter honestly and sincerely.