Property Tax Cap (the short version)

THE GUARDIAN has been hearing elected officials mentioning and lamenting a thing called "the cap".  And in the same context they mention bumping into "the cap".  This was a new term I didn't have a reasonable feel for what it is and how it is calculated so I went on a quest for knowledge of this mysterious thing called "the cap"

Heretofore, all taxing districts have been in a growth economy and under Idaho Code their levy rates were budget driven.  This meant no matter what you assessed valuation amounted to all the taxing entities could take all the new growth plus a 3% increase in their maximum taxes levied against all real property.  If last year they got $100, this year they could take a 3% increase and take $103 for the sake of simplicity.

The past three years we have a situation where we have falling real property values and to protect property owners the Idaho Legislature wisely placed a "cap" on what all taxing districts can extract (levy) from property owners.  They simply can't continue to raise taxes in a down economy with taxpayers ability to pay imploding with regularity and lockstep with the general condition of the economy.

Idaho Code specifies the maximum amounts of money each taxing entity can take based  upon the average three year total assessed value of all real property.  Here are some examples spelled out by Idaho Code:

TAX ENTITY                                                   ID. CODE SEC.    CAP MULTIPLIER

Airport ..................................................................... 21-404                    .0004
For building and/or maintenance.
Ambulance Service ................................................. 31-3901                   .0002

Appraisal Program .................................................. 63-314                     .0004

Armory Construction............................................... 46-722                     .0002
Must jointly levy w/city. Total levy cannot exceed max levy.

So, here we are in 2011 with declining property values and most taxing entities faced with forced budget reductions v. going merrily forward with a 3% increase each and every year.  The "cap" was something wisely built into Idaho Code to protect taxpayers in a down economy from "PREDATORY TAXATION" regardless of the needs or wants of taxing districts.  Most elected officials do not have an understanding of "the cap" but it is out there and would behoove citizens to find out what it is in areas they have a concern about over-taxation.

( A special thanks to Joe Cox and Zach Wagoner who work for the Canyon County Assessor and Auditor/Recorder respectively for their help and explaining "the cap" to me.)