Coconino County supervisors have raised taxes on Flagstaff residents even before the city council had a chance to meet with supervisors or discuss it among themselves.
According to a resolution approved by the supervisors Tuesday, properties in the cities of Flagstaff and Page and the town of Fredonia will no longer be exempt from a county flood control district tax.
The county resolution passed in spite of concerns voiced by two Flagstaff city councilmembers at the supervisors' meeting about how quickly the county had moved to change the flood control district’s taxing structure. Although the county has been aware of the potential changes since February, the Flagstaff City Council learned about it in early May and its first opportunity to talk about the issue collectively would be Tuesday afternoon, after the supervisors had already voted, Mayor Coral Evans told the board on Tuesday morning.
"We have a lot of questions that remain unanswered,” Evans said.
Among those, she said, are the full impact to the city and city residents. Flagstaff Interim City Manager Barbara Goodrich also sent the county a letter on May 10 with 10 specific questions about the resolution and the workings of the flood control district moving forward. The board and county staff addressed some of the questions Tuesday before the vote.
"Now that we know the details, as a matter of priority we are doing our due diligence to research our options," said Deputy City Manager Shane Dille.
According to county estimates, the owner of a $300,000 home in Flagstaff will now be charged an additional $55 on their property taxes to help fund the county flood control district. A commercial property in the city worth $500,000 would see a flood control tax bill of $164.
The tax rate estimates for Flagstaff residents are based on a total property tax collection of $2.2 million, which is the district’s expected budget for the coming year. Judging from assessed values in the county, tax revenues from Flagstaff property owners will make up more than half of that $2.2 million going forward, said Mike Townsend, deputy county manager.
Based on information the county has now, the new tax would show up on property bills in Flagstaff, Page and Fredonia this fall, said Lucinda Andreani, interim deputy county manager and director of the public works department, which is responsible for administration of the flood control district.
While those property owners will pay more, those who were already paying the flood control district tax will see their rate drop because the total amount collected will be spread out among more taxpayers.
The board’s resolution and the change in taxation is based on new legal advice stating that the flood control district tax should be levied upon all properties within the county. A previous interpretation held that municipalities like Flagstaff that choose to manage their own floodplains could remove themselves from the district for the purpose of taxation, Andreani said.
Flagstaff just does that and has spent $15.5 million for Rio de Flag flood mitigation without county funds.
In her comments to the board of supervisors, Evans also said she was concerned about the lack of public participation on the tax change.
“We feel that the public has not had the opportunity to fully vet this conversation," she said.
In response, county supervisors, who also serve as the Flood Control District Board of Directors, reiterated the need to align with state statute and consistently apply the flood district tax across the entire county.
While the city may want to see more public input, this isn’t an issue where the county has discretion in how it moves forward, said Lucinda Andreani, interim deputy county manager and director of public works, which oversees the flood district.
“If you're doing something not in conformance with state law you are expected to take action quickly,” Andreani said. Not doing so could open up the county to a lawsuit by a property owner currently being assessed the flood district tax who could arguing they are illegally being charged more than their fair share, she said.
She said it was also important to make the tax change now, as the county is finalizing its budget for the coming fiscal year.
Arizona’s 14 other counties already assess a flood control district tax on all properties within their boundaries, Andreani said.
After voting on the resolution Tuesday, supervisors said they welcome action by local jurisdictions to review the legality of the county’s decision and, if necessary, take the issue to court to get a final determination from a judge.
Once the tax change gets implemented, if it does survive or avoid legal challenges, supervisors hope to meet with local municipalities to develop a process for evaluating, prioritizing and supporting projects for flood control district funding, said Matt Ryan, board chair.
There’s also potential for the district to increase its budget and fund more projects, which would cost taxpayers more, but that needs to be evaluated down the road, Ryan said.