Wednesday, October 1, 2014

Public spending differs from city to city

Lower property values lead to higher tax rate

Express Staff Writer

Blaine County’s 21,323 residents live on a sharp demographic divide, from so-called bedroom communities and agricultural areas in the south, to resort and second-home neighborhoods in the north. That results in differences in the amount and type of public spending, from Carey and Bellevue in the south to Ketchum and Sun Valley in the north.
    All Blaine County residents pay the same proportion of property taxes for county services, with separate budgets for the Recreation District, ambulance service and the School District. Those living in cities pay additional taxes for city services, including libraries, fire departments, police, and water and sewer services.
    City governments set tax levy rates each year, based on their property values, to raise enough money to fund planned expenditures. Cities with high property values, such as Ketchum and Sun Valley, have lower tax levies because the cumulative value of those cities’ homes brings in more revenue.
    Bellevue (population 2,010) has been spending to upgrade water mains for several years in order to install water meters, whereas Hailey (pop. 8,014) has spent big on expansions at Werthheimer Park, where many residents enjoy recreational opportunities.
    Ketchum (pop. 2,728) recently enhanced a town plaza that will cater as much to tourists as locals. Sun Valley (pop. 1,394), which contains many seasonal-use homes and condominiums, has little need for parks, but spends proportionally more on fire protection.
    Last year, the total operating expenses for Hailey and Bellevue were nearly equal, about $1,900 per household, or about $800 per full-time resident.
    Though Ketchum has less than half the number of residents as Hailey, it spends more than twice what Hailey does on police protection. That’s due to an influx of seasonal tourists, and to the high number of second homes in the north valley.
     Resort areas must train and equip fire departments year round, preparing for peak seasons such as Christmas, when the population could double. They have to maintain the capacity to respond to the total number of households, whether they are regularly occupied or not.
    Last year, Ketchum spent just over $3,000 in total operating expenses per household. Sun Valley spent $2,800 per household. Because many of the homes in Ketchum and Sun Valley are vacant for much of the year, the total operating expenses per full-time resident were much higher in those cities, $4,200 and $4,900 respectively.
    Sun Valley spends $462 per full-time resident for fire protection, which helps residents in that high-end housing market reduce the cost of fire insurance.
    Across the United States, there is a wide range of spending per capita for fire protection. By comparison to local costs, the city of Chula Vista, Calif., (pop. 243,916) spends only $63 per capita on fire fighting.
Cities in the south valley have suffered more during the recession than northern cities, losing far more in total taxable property values. As a result, Bellevue’s levy rate ($3.6 per $1,000 in value) is nearly triple the levy rate of Ketchum ($1.4 per $1,000 value).
Blaine County Clerk JoLynn Drage said the difference in levy rates balances out across the demographic divide in Blaine County, because those with less value end up paying less in total taxes.
    Drage said Ketchum, with $2.5 billion in taxable property, will collect $3.68 million in fiscal 2015. Bellevue, with $161 million in taxable property, will collect $588,000.
    “The rate stays lower in Ketchum because of the higher dollar value of properties. Bellevue does not have the value to bring that rate back down,” Drage said.

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