Arizona Property Tax Assessed Valuation Amendment, Proposition 117 (2012)
|Referred by:||Arizona State Legislature|
|Status:||On the ballot|
Text of the measure
The summary of the measure reads as follows:
|“||A Concurrent Resolution proposing an amendment to Constitution of Arizona; Amending Article IX, Section 18, Constitution of Arizona; Relating to property tax assessed valuation.||”|
- State Senator Steve Smith stated, "Prop. 117 will limit annual assessed value growth to 5 percent and will protect property taxpayers from dramatic increases in property valuations that often lead to significant tax increases. In addition, Prop 117 will simplify one of the most complicated property tax systems in the country."
The following are arguments that were submitted to the Arizona Secretary of State for the state voter guide. You can read more arguments here:
- The Arizona Tax Research Association (ATRA) urges your support of Prop 117 because it will protect property taxpayers from dramatic increases in property valuations that often lead to significant tax increases. Prop 117 will limit annual assessed value growth to 5%. In addition, Prop 117 will simplify one of the most complicated property tax systems in the country. Currently, property in Arizona is taxed on two values: full cash, or market value (FCV) and the limited property value (LPV). The Constitution requires that FCV represent the market value, which is unlimited in the amount it can increase each year. In contrast, the LPV is required to annually increase by the greater of 10% or 25% of the difference between the current year FCV and the previous year's LPV. That doesn't just sound complicated - it is. Prop 117 limits the taxation of property to the LPV and the FCV will no longer be taxable. Eliminating the tax on market value will prevent a repeat of the dramatic increases in property taxes that occurred between 2004 and 2009 when real estate values skyrocketed. ATRA strongly believes that the 5% limit is fair for taxpayers and Arizona state and local governments. A reasonable limit will not only provide greater predictability for taxpayers, it will bring much needed stability to future local government budgets. Had the 5% limit been in place over the last decade, it would have prevented $33 billion in value from being added to the tax rolls that was ultimately removed when the market collapsed.
Submitted by David L. Minard, Treasurer, Arizona Tax Research Association; Kevin J. McCarthy, President, Arizona Tax Research Association.
- "I am in full support of Proposition 117. I have worked in the Assessor's Office since 1977 and witnessed, first hand, the installation of the current property tax formula in 1980. At the time, it was a welcome relief from the runaway taxation that was occurring due to rising property values. However, the current system is flawed with many complicated formulas that are outdated and no longer are applicable to the times we live in. For many years I have been advocating that the Limited Value formula needed to be simplified and that property taxes needed to be more predictable. This measure does both. Having all ad-valorem property taxes calculated from the Limited Property Value and simplifying the LPV formula to a simple 5% calculation will greatly assist Arizona assessors in explaining tax bills to the property owner. Please join me and vote Yes on Proposition 117."
Submitted by Joe Wehrle, Yuma County Assessor.
- "Proposition 117 is good for the taxpayers of Arizona. It creates a limitation for valuations of locally assessed taxpayers. The provision would not shift tax burdens from commercial properties to residential properties (homeowners). The original two tiered system of Full Cash Value and Limited value was to protect the taxpayers from rising values and uncontrolled spending by the taxing jurisdictions. History has shown that as property tax values grow, the impulse by government to "keep the tax rates steady", thus generate more revenue, increases. This proposal is timely as in most areas of the state; Full Cash and Limited Values are identical. Additionally, the administrative and judicial appeal systems will remain intact. I support Proposition 117 to provide more predictability and stability to the taxpayers of Arizona."
Submitted by James R. Brodnax, resident of Glendale, Arizona
- According to Lynne Weaver, chairman of Prop. 13 Arizona, in an editorial, "Prop. 117 does nothing to stop tax overrides put on the ballot by school districts. The maximum override used to be 10 percent but it was increased to 15 percent and a special election was held to allow the school districts to raise your taxes immediately. Will they increase overrides to 20 percent? 25 percent? More?"
Path to the ballot
A majority vote is required in the Arizona State Legislature to send a constitutional amendment to the ballot. Arizona is one of ten states that allow a referred amendment to go on the ballot after a majority vote in one session of the state's legislature.
- Arizona 2012 ballot measures
- 2012 ballot measures
- Arizona Legislature
- List of Arizona ballot measures
- Arizona Legislature, "SCR 1025", Retrieved May 14, 2012
- Arizona Secretary of State, "Ballot Measures", September 17, 2012
- Note: This text is quoted verbatim from the original source. Any inconsistencies are attributed to the original source.
- In Maricopa, "Steve Smith: Ballot proposition recommendations", October 15, 2012
- Camp Verde Bugle Online, "My Turn: Prop. 117 does nothing to limit property taxes", August 16, 2012