City staff is seeking Council direction on posting a 60-day website notice related to Primary Property Tax.  A notice is required to be posted on the City website and distributed through social media at least 60 days prior to adoption of a new tax or fee, or an increase in the rate of a tax or fee, per A.R.S. Section 9-499.15 ("60-day notice"). The City must post the 60-day notice in the event Council would be considering adoption of either an increase in either the Primary Property Tax levy (revenues) or the Primary Property Tax rate.

If Council gives direction to increase our Primary Property Tax levy (revenues) the City is required to publish Truth in Taxation notices in the local newspaper, per A.R.S. Section 42-17107. City staff is asking Council if they would like to provide a 60-notice. Posting the 60-day notice on the City's website does not commit the City to increase the levy.  

City staff is seeking City Council direction on whether it desires to post a 60-day notice on the City's website prior to consideration of adoption of an increase in the Primary Property Tax levy (revenues).  

Arizona's statutes allow cities to increase their Primary Property Tax levy (revenues) by 2% annually, excluding new construction added to the assessment rolls.  If the cities do not utilize the maximum allowable levy, the increase is available in future years in addition to 2% allowed annually.  The City did not assess the increase levy since FY 2019-2020, and therefore we are allowed to increase the levy up to 8%, $590,000 for the next fiscal year. 

Arizona Revised Statutes Section 9-499.15 requires posting of a 60-day notice on the City website and social media if the City proposes to impose a new tax or fee, or increase the rate of an existing tax or fee.   The public notice includes posting on our website and social media.  The deadline to post the notice is April 21, 2023.    

The current Primary Property Tax rate is 0.6954 per net assessed valuation and the maximum allowable rate, with the 8% levy increase, is $.7180 per net assessed valuation.

Arizona Revised Statutes Section 42-17107 requires publication of Truth in Taxation notices in the local newspaper if the City considers increasing our Primary Property Tax levy (revenues) by any amount above the prior year's levy plus new construction.  Should Council give direction at the April Budget Retreat to increase the levy the publication requirements will begin late May.  The process will include posting a notice in our local newspaper twice as well as a public hearing during budget adoption.    

The current City Manager budget proposal will be discussed on April 27 and 28, 2023 at the Budget Retreat.  The proposal does not include a recommendation to increase the Primary Property Tax levy.  During the retreat, the City Council will have the ability to provide direction to amend the proposed budget.  Decisions could include balancing the proposal by adding items to fund with potential offsets of deleting items that are currently proposed.  In addition, the Council could propose a Primary Property Tax levy increase, up to 8%, to fund additional items or programs at the Council's request.  

If the Council would like to discuss the option of increasing the Primary Property Tax levy at the Budget Retreat, staff recommends posting a 60-notice on the City website and through social media. As part of the posting we would provide the public with information to be considered at the Budget Retreat.