Kootenai landowners to see tax relief

Kootenai County property owners will save nearly $5 million in property taxes next year, but that doesn’t necessarily mean their tax bills will decrease.

The area’s hot real estate market – in which people are willing to pay higher prices for homes, land and businesses – has resulted in skyrocketing property value assessments. The consequence is that the more your property is worth, the more property tax you pay.

County Finance Director David McDowell said the property tax relief isn’t enough to keep away significant increases in the tax bills of people whose property has seen large jumps in valuation.

Yet he said it “lessens the blow a little bit” and makes it a lot more palatable than in other resort counties, such as Bonner County, where there is no mechanism for property tax relief.

Kootenai County’s property tax relief comes from the voter-approved local option sales tax where half the money goes toward paying for the county jail expansion and the remainder goes toward property tax relief.

It’s difficult for the county to give a good example of how much property taxes are likely to increase for the owner of an average home. McDowell said it all depends on how much the home’s valuation increased in the last year.

He’s predicting that anybody with a property value assessment that’s gone up more than the county average of 27 percent will likely pay more in property taxes in fiscal year 2006.

If a person’s property valuation didn’t change or went up less than the 27 percent county average, their property taxes could drop.

“There are all the possibilities from zero to astronomical,” McDowell said about the variation in assessed property values.

These increases in assessed property values, along with the large number of new homes and businesses, have expanded the county’s tax base.

The county estimates net property values increased $2.7 billion this year, bringing the county total to about $10.4 billion. New development in Kootenai County added about $332 million to the tax base, which is up about $62 million from 2004.

The county will have a public hearing Sept. 6 on its proposed $72.5 million budget, which begins Oct. 1.

That’s a $15.2 million increase from this year, mostly due to a proposed $12 million transfer station north of Post Falls.

County Commissioner Rick Currie said that the new growth will help pay the $1.3 million cost to hire 28 new employees.

McDowell said these positions are desperately needed with Kootenai County’s growing population but still leave some departments in need. He said countywide, 63 new employees were requested.

The sheriff department will get four new patrol deputies and a detective in addition to a few more jailers and a sergeant for the work-release program.

The planning and building department, which is the frontline for dealing with the county’s growth, is getting three new positions.

“We generate about a file drawer of paperwork a week,” Planning Director Rand Wichman said about the high volume of work in his department.

The recorder’s office that keeps track of a record number of new real estate transactions is getting two new employees.

The county commission also made it a priority not to use its full taxing authority and plans to leave $274,385 in foregone taxes – property taxes that the county has the ability to collect but instead is opting to leave in property owners’ pockets.

Last year the county tapped $870,000 in foregone taxes, the first time in years, in an effort to make county wages more competitive and stop an employee exodus.

“I made a commitment to put that back,” Currie said about the foregone taxes. “It’s a start.”

The foregone money taken last year went toward giving county employees more than $1 million in salary and benefit adjustments to keep county pay in line with other Northwest governments and similarly sized businesses.

About half of the county’s 680 employees received wage increases – jumps that ranged from 2 cents an hour to $4 an hour. Some sheriff’s deputies saw the largest adjustments, with one patrol officer getting an $8,408 annual increase.

In 2006, the county’s nine elected officials, including the three county commissioners, will get significant pay increases.

The coroner will get the largest increase – $32,213 – which will bring the salary to $58,000. Even though the coroner is a full-time position, McDowell said this is the first year it will have the equivalent of full-time pay.

The prosecutor will get a $14,847 increase, bringing the total salary to $93,000. The sheriff is next with a $14,730 increase, for a salary of $80,000.

The commissioners will get a $13,486 bump, to $67,000. The assessor, clerk and treasurer will each get an $11,486 increase, for annual salaries of $65,000.

The commissioners, assessor, clerk and treasurer now each make $53,514 a year.