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Property taxes are the City�s largest source of revenue of general government
revenue. Property taxes are assessed to taxpayers based on �taxable
market value � of properties and upon a rate formula prescribed in State
code. Since 1995, a �3 Percent cap� limitation has been a key
characteristic of Idaho cities property taxation.
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| Fiscal
Year |
1998a |
1999a |
2000a |
2001a |
2002a |
2003r |
2004p |
2005p |
2006p |
2007p |
| Annual 3% Increase |
1,384 |
1,471 |
1,555 |
1,658 |
1,823 |
1,929 |
2,048 |
2,147 |
2,250 |
2,361 |
| Growth
Formula |
1,502 |
1,350 |
1,859 |
3,856 |
1,675 |
2,068 |
1,269 |
1,296 |
1,421 |
1,415 |
| Adjustments |
363 |
250 |
129 |
661 |
(213) |
(1) |
(1) |
(1) |
(1) |
(1) |
| Foothills Levy |
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4,907 |
4,905 |
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| Base |
46,131 |
49,017 |
51,837 |
55,251 |
60,764
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64,261
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68,257 |
71,572 |
75,014 |
78,684 |
| Total Proceeds |
49,379 |
52,087 |
55,380 |
61,425 |
68,955 |
73,162 |
71,572 |
75,014 |
78,684 |
82,458 |
| % Change |
6.8% |
5.5% |
6.3% |
10.9% |
12.3% |
6.1% |
-2.2% |
4.8% |
4.9% |
4.8% |
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| Historical Events |
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Starting in 1995, the �Three Percent Cap� limited budget requests to a 3%
increase over the greatest of the three prior year�s budgets plus a �growth
amount� from new construction and annexation.
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Prior to 1996, Boise City levied for the current year. In FY 1996, the
City�s debt was restructured to allow the City to levy for the subsequent year
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The New Construction Roll was implemented in 1997. This restricted the
growth amount to only complete new construction rather than the value all
building permits that were issued
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In 1999, for the purposes of the New Construction Roll and Occupancy
assessments, residential construction is exempted from assessment until it is
first occupied
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In 1996 and 2000, Boise City completed large annexations that resulted in
annexation values of $222 million and $421 million, respectively.
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Changes in the assessment of leased personal property and in the processing of
tax cancellations affected the adjustments on the subsequent roll in FY 2001
and FY 2002.
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| Projection/Assumptions |
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Growth formula projections are based on the assumption that 2003 � 2006 new
construction values will be at about 90 percent of the trailing six year
historical average and that only developer initiated annexations will be
included. Building permit numbers and valuations of construction are used
as an estimator of new construction activity for the growth formula
projections. The projections during the six year projection window assume
that the economy will continue in levels similar to that of FY 2002.
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Projections for the six year window reflect less than 5 percent annual property
tax proceeds increase over the prior years compared to almost 6 percent annual
increase during the last six years. This projection is conservative and
reflects the slowing of new construction activity evident in 2003.
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Threats/Opportunities
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In FY 2003, the New Construction Roll was estimated to be $250 million.
The actual new construction roll value is $224 million, which results in
$144,000 less in tax revenues than estimated.
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If the new construction activity were to increase in the future, the impact
would not be recognized for one year because of the way the new construction
roll is created and assessed.
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If the economy were to significantly improve during the projection window, tax
proceeds could be used to meet unfunded facilities demands.
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City initiated annexation would provide additional tax revenue to offset the
cost of services to the annexed area. However, annexations have proven to
be a controversial topic to some residents in Boise City and in the City impact
area.
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Passed in 2003, House Bill 453, which allows capital investment income tax
credits to be applied toward personal property taxes as an exemption, may have
a significant impact on Boise City taxpayers. This exemption will result
in a tax shift to other taxpayers equivalent to the amount of tax credit.
The exemption remains with the personal property for two years.
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House Bill 302 also passed in 2003. This places the burden of proof in property
tax appeals on the party seeking affirmative action, thus making is easier for
taxpayers to appeal their assessed value.
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Qwest Corp. appealed its 2001 and 2002 property tax valuations in FY 2003.
The court date is set for October 2003. Boise City could lose up
to $1.4 million in revenue, if the Court reduced Qwest�s value to $0 for both
years. Any lost revenue could be recovered by a judgment levy in FY
2004.
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