Pub. 5 2015-2016 Issue 2

7 Taxpayers will see an additional line item on their property tax notices this year but that does not mean there is a new tax being levied. This new item on the property tax notice represents the work of Utah’s legislature on Senate Bill 38. SB 38 brought greater equity in funding for Utah’s students by increasing the amount of state money appropriated to charter schools by $20 million. The bill also added an increased amount of transparency to the property tax notice. Now, the notice will show exactly how much of a property owner’s taxes are going towards their local school district and how much is going to fund students who live in the district, but attend a charter school. In the past, the notice has not shown taxpayers howmuch of their property tax went towards charter schools. It only provided line items for their local district and the basic statewide levy. Thanks to Senate Bill 38, a new line item will be introduced to show the portion that the charters will receive. Again, I want to reiterate, this is not a tax increase. The current line item for the school district will now subtract the portion of the taxes collected for charters to show how much of the property tax is going to the local district. The next line will then show the subtracted amount indicating how much of the tax is going to charter students. If a taxpayer adds the two numbers together, they will find that the combined tax rate is the same as it has been prior to the passage of SB 38(unless the district is raising its tax this year.) At the risk of over explaining, I’ll try it one more way. The taxes collected for public education in Utah will still occur the same way and at the same amounts. What Senate Bill 38 changes is the mechanism that explains where tax dollars end up. Charter schools will still have no taxing authority under this bill, but will receive additional funding from the state. This new money begins to close the funding disparity between charter students and students attending local district schools. This money is coming from growth in state income taxes, not from tax rate increase. This is a step in the right direction. SB38 ensures that all Utah students attending a public school are receiving adequate funding and that Utah students have a choice in where and how they receive their education. While much of this is positive for taxpayers and Utah’s students, there is one caution that comes with this bill. As this new line item on the property tax notice is imple- mented, some local school districts may seek to increase their own taxes in the future and justify the hike by claiming the districts are losing money to the charter schools. To prevent this from immediately happening the legislature included a provision in SB 38 that prevents school districts from raising taxes this year unless they made their intentions to increase taxes known by March 4. However, that does not mean that in the years to come the district schools will not seek to ask taxpayers for additional money citing the amount given to charters as the reason. That argument should be dismissed immediately. Taxpayers are paying to provide the best education possible to all Utah students. If a student chooses to attend one school over another that does not justify higher taxes. Instead, that should send a signal to the school losing the student that it is time to improve, and find a way to be more attractive to that student. We expect Utah’s students will be the greatest benefactors from this legislation as it makes great efforts to ensure that every Utah student has an opportunity for a great education in Utah. The Taxpayer will also benefit, as they will have the opportunity to better understand how their dollars are helping Utah students succeed. TRUTH IN TAXATION BY BILLY HESTERMAN, VICE PRESIDENT OF THE UTAH TAXPAYERS ASSOCIATION