Salt Lake City Property Tax: How Does It Compare To Other Major Cities?

When it comes to home ownership, a house payment is only half of the story.  While taxes continue to soar in many parts of the nation, Salt Lake City property tax remains among the lowest of major metropolitan areas in the country, with Utah’s average property tax ranking 11th lowest in the nation.  With the majority of taxes going to schools and the remainder to Salt Lake County’s extensive public works operation, Salt Lake City property tax process is fair and transparent.

How Property Taxes Are Set

Salt Lake City property taxes are set using a simple calculation established by the Utah Constitution.  The state’s, county’s, and city’s approved budgets are divided by the total tax base to arrive at the property tax rate.  From there, the property’s value is multiplied by the property tax rate for each of the taxable government functions.  However, primary residences are only taxed at 55% of the property’s value, while secondary and income properties are taxed at 100% of the property’s value.

A typical primary residence in the Avenues neighborhood of Salt Lake City, valued at $400,000 will be taxed at 55% of its value, meaning the taxable value will be $220,000.  At a total property tax rate of 0.736%, the home’s value will yield a total property tax of $1619.

What Is Covered in Salt Lake City Property Taxes?

In Salt Lake City, the following government services are included in property taxes.

• Salt Lake County School Districts – The majority of funding for schools in the state of Utah comes from property taxes.
• State Basic School Levy – A State mandated levy to ensure equity in public education between school districts state-wide.  This levy is used to determine per pupil funding.
• Salt Lake County School Districts Capital Outlay – All school districts in Salt Lake County are required by the legislature to levy a tax for capital expenditure equalization.
• General Fund – County-wide levy that funds the operation of county government.  These services include aging services, meals on wheels, jail services, regional park and recreation, etc.
• Capital Improvements – Funds county-wide projects that are not funded by bonds.
• Bond Interest and Sinking Fund – Funds payments of principal and interest on bonds issued by public vote.
• Flood Control – While this tax may seem strange in a desert, these funds maintain ways for mountain run-off to be diverted away from homes and businesses.
• Government Immunity – Funds litigation against the government.
• Health Services – Pays for county-wide health services.
• Cities and Towns – Salt Lake City charges taxes for services such as garbage pick up, and snow removal.
• Clark Planetarium – Levy funds the Clark Planetarium located in Salt Lake City.
• Emergency Services Districts – Funds police and fire services throughout the county.
• Libraries – Keeps libraries open throughout Salt Lake County.
• Water Conservancy Districts – Levy pays for water services throughout the county.
• Mosquito Abatement Districts – Pays for mosquito control throughout the city.
• Water and Sewer Improvement Districts – This tax is in addition to monthly service fees and partially funds the costs of providing connections to water and or sewerage treatment facilities.

How Does Salt Lake City Compare?

Utah’s property tax rate is ranked 11th lowest in the nation.  While Salt Lake City’s property taxes are among the highest in the state of Utah, they are still a bargain compared to other cities of comparable size and location.

Boise, Idaho is not only Idaho’s capital but also contends with many of the same environmental issues that Salt Lake City does, namely its location in a desert and the need for snow removal in the winter.  With a population of approximately 214,000, compared to Salt Lake City’s population of approximately 191,000, Boise levies a 0.795% property tax, 0.059% higher than Salt Lake City.

Reno, Nevada, with a population of approximately 233,000 charges 0.903% of a property’s value in taxes.  Salt Lake City is able to provide significantly more snow removal service than Reno with 0.167% less in tax revenue.

Transparency Is Paramount

Utah Law allows for property tax rates to automatically increase or decrease when property values increase or decrease.  This ensures tax revenues to remain consistent from one year to the next and keeps a property owner’s tax burdens at a constant level.  For instance, if a property increases in value, the taxable percentage decreases.  If a property’s value decreases, its taxable percentage will increase.  These minor fluctuations keep the state’s tax revenue consistent to allow for proper budgeting.

However, taxing entities, such as city governments, school districts, and county governments, may not automatically increase taxes under Utah’s “Truth in Taxation” law.  This process, established by the Utah State Legislature, ensures taxing entities would not increase taxes without a public hearing and vote from its governing body. Property owners throughout the state are sent notices prior to taxation with a listing of the previous year’s taxes and the new proposed tax rates.  At that time, citizens may make their opinions known during public hearings where the new tax rates are voted upon.  In all cases, taxing entities seek as much transparency in the taxation process as possible.

While Salt Lake City is not the largest city in the west, its favorable laws and low property tax rate only enhance the appeal of this up-and-coming metropolitan area.

2 Point Highlight

While Salt Lake City’s property taxes are among the highest in the state of Utah, they are still a bargain compared to other cities of comparable size and location.

With the majority of taxes going to schools and the remainder to Salt Lake County’s extensive public works operation, Salt Lake City property tax process is fair and transparent.