Some Idaho property taxes may not go down as much as owners might expect

by Lora Volkert @ Idaho Business Review
10/16/2006

Boise residents and business owners may not see their property taxes fall as much as expected.
The Property Tax Relief Act of 2006, passed in August by a special session of the Legislature, means most school maintenance and operations budgets will come out of the general fund rather than being paid with property taxes.

That essentially eliminated a 0.3 percent property tax levied by school districts. The money will be replaced with an additional 1 percent sales tax and $50 million from the budget surplus.

But the Boise School District will still levy property taxes for its maintenance and operations budget, Commissioner Tom Katsilometes said at a recent meeting of the Idaho State Tax Commission.

Boise School District started with a higher levy rate than other school districts — 0.66 percent. Katsilometes said that, after the reduction, taxpayers in the Boise School District will still pay 0.36 percent.

The Boise School District won’t be the only one that still levies property taxes, Katsilometes said. The Blaine, Swan Valley, Avery and McCall-Donnelly school districts will be able to levy property taxes for their budget stabilization funds.

Those funds insure that the school districts receive the same amount of money per child that they did in prior years, regardless of what happens to their school populations or the economy, Katsilometes said.

The Property Tax Relief Act dealt with about $260 million in school maintenance and operations funds, equating to 19 percent of property taxes levied in the state. But Katsilometes said the actual amount of the school maintenance and operations budget is about $346 million.

The Boise, Blaine, Swan Valley, Avery and McCall-Donnelly school districts would still levy the remainder, he said. About 60 percent of the remaining $87 million goes to the Boise School District.

The school maintenance and operations budget was projected to increase by 16 percent before the Property Tax Relief Act went into effect.

Another change to the school district taxing structure that hasn’t been discussed much is that the schools will now be more subject to the legislative appropriations process, said Gary Houde, senior research analyst for the State Tax Commission.

Most people he talks to seem to be under the impression that the extra penny per dollar in sales tax will be automatically earmarked for schools every year, but it is not, he said.



$260 million

School maintenance and operations budget to be paid from the general fund instead of property taxes.


$87 million

Property taxes that would still be levied by school districts.


$52 million

Property taxes that would be levied by Boise School District alone.