As reported in Tuesday's Clipper, a financial "windfall" could've netted the school district up to several million dollars, and more than $100,000 for Bountiful City, for example.
It all stemmed from the State Tax Commission's way of calculating the certified tax rate. That barometer is then applied by all government entities, from mosquito abatement districts to county governments -- for setting tax rates.
The error was discovered by County Clerk/Auditor Steve Rawlings last week. He and others started contacting state tax people, and some fast-track action was started to correct the error. That's because cities and school districts start a new fiscal year July 1, and that involves 16 entities inDavis County alone.
The reason for adjusting the certified tax rate stemmed from a change in the way it's calculated, thanks to legislation implemented by Rep. Ann Hardy, R-Bountiful.
"It changed the top part of the formula from taxes collected to budgeted revenues" in determining the rate, said Lee Brennan, deputy division director for property tax with the State Tax Commission in Salt Lake City, Wednesday.
"We made a decision, passed it out to the entities, and when they got to looking at it, they said they thought maybe some items should've been included in that revenue that were not,"she said.
State officials ended up agreeing there were problems that were being corrected as of Wednesday. "We're in the process of making those corrections and are getting back to the entities."
Those included board of equalization adjustments and five-year collection rates, among others.
"The result will be lowering the budgeted revenue figure that goes in the top part of the formula. Since that has been lowered, it will have the effect of changing the rate,"she explained.
"The counties should already have this new formula. They can go about setting their rate. We'll get an official notice to them," hopefully by week's end, Brennan said.
"We should not have any surprises like this next year,"she added.
The Utah Taxpayers Assoc. (UTA) met with state tax staff Monday to iron out any potential problems.
"When we met with the tax commission we were trying to discover why it is that the certified tax rates that they had distributed were around 10 percent higher than what they had been,"said Howard Stephen-son, UTA director.
"We worked with them for about three hours, helping them discover they were not using the correct figure,"he said.
"It was important to note, the 10 percent increase would bump taxes. The public wouldn't even know about it, because it wouldn't have to go through truth in taxation. That was what was most disconcerting," said UTA's research analyst Chad Vanderlinden.
At the same time, Davis County officials from cities and elsewhere were meeting in Farmington on the issue.
The vast majority attending that meeting agreed the rate had to be revised in order to not hurt taxpayers.
"Ithought it was very courageous of the county to recognize the problem and to take the position they did and encourage everyone (cities, etc.) to not take advantage of the situation,"City Manager Tom Hardy said.
"I think that everyone was trying to do the right thing. A lot of times, in government, people worry about the officials doing the right thing.
"In this case, absolutely, what Steve Rawlings and his staff were trying to do was the right thing."
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