Property Tax Changes

9
53F-2-601
59-2-919
0
Property Tax Changes
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Kay J. Christofferson
Senate Sponsor:
LONG TITLE
General Description:
This bill amends the processes by which a taxing entity may increase the taxing entity's
property tax revenue.
Highlighted Provisions:
This bill:
limits the total amount of additional property tax revenue a taxing entity may obtain
through the truth-in-taxation process;
requires a taxing entity to obtain voter approval to exceed the limit on total additional
property tax revenue;
provides the requirements for submitting a question to voters for approval and the effect
of receiving voter approval;
eliminates the hold harmless period for state guaranteed funding related to a reduction in
a school district's certified tax rate; and
makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides a special effective date.
Utah Code Sections Affected:
AMENDS:
53F-2-601
, as last amended by Laws of Utah 2025, Chapters 6, 165
59-2-919
, as last amended by Laws of Utah 2025, First Special Session, Chapter 17
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
53F-2-601
is amended to read:
53F-2-601
. State guaranteed local levy increments -- Appropriation to increase
number of guaranteed local levy increments -- No effect of change of minimum basic tax
rate -- Voted and board local levy funding balance -- Use of guaranteed local levy
increment funds.
(1)
As used in this section:
(a)
"Board local levy" means a local levy described in Section
53F-8-302
.
(b)
"Capital local levy" means a local levy described in Section
53F-8-303
.
(b)
(c)
"Excess funds" means the difference between:
(i)
the amount of state guarantee money a school district received in the 2025 fiscal
year; and
(ii)
the amount of state guarantee money a school district would receive based solely
on the certified tax rate in effect for the 2025 fiscal year.
(c)
"Capital local levy" means a local levy described in Section
53F-8-303
.
(d)
"Guaranteed local levy increment" means a local levy increment guaranteed by the
state as described in Subsection
(2)
.
(e)
"Local levy increment" means .0001 per dollar of taxable value.
(f)
"Voted local levy" means a local levy described in Section
53F-8-301
.
(2)
(a)
(i)
In accordance with Subsection
53F-2-205(6)
and in addition to the revenue
collected from the imposition of a voted local levy or a board local levy, the state
shall guarantee that a school district receives, subject to Subsections
(2)(b)(ii)(B)

and
(3)(a)
, for each guaranteed local levy increment, an amount sufficient to
guarantee for a fiscal year beginning on or after July 1, 2018, $43.10 per weighted
pupil unit.
(ii)
The number of guaranteed local levy increments under this Subsection
(2)
for a
school district may not exceed 20 guaranteed local levy increments, regardless of
whether the guaranteed local levy increments are from the imposition of a voted
local levy, a board local levy, or a combination of the two.
(b)
(i)
Subject to future budget constraints, the Legislature shall annually appropriate
money from the Local Levy Growth Account established in Section
53F-9-305
for
purposes described in Subsection
(2)(b)(ii)
.
(ii)
The state board shall, for a fiscal year beginning on or after July 1, 2018, allocate
funds appropriated under Subsection
(2)(b)(i)
and the amount described in
Subsection
(3)(c)
in the following order of priority by increasing:
(A)
by the amount described in Subsection
(2)(a)(ii)
; and
(B)
the guaranteed amount described in Subsection
(2)(a)(i)
.
(3)
(a)
The guarantee described in Subsection
(2)(a)(i)
is indexed each year to the value
of the weighted pupil unit by making the value of the guarantee equal to .011962
times the value of the prior year's weighted pupil unit.
(b)
The guarantee shall increase by .0005 times the value of the prior year's weighted
pupil unit for each year subject to the Legislature appropriating funds for an increase
in the guarantee.
(c)
If the indexing and growth described in Subsections
(3)(a)
and
(b)
result in a cost to
the state in a given fiscal year that is less than the amount the Legislature
appropriated, the state board shall dedicate the difference to the allocation described
in Subsection
(2)(b)(ii)
.
(4)
(a)
The amount of state guarantee money that a school district would otherwise be
entitled to receive under this section may not be reduced for the sole reason that the
school district's board local levy or voted local levy is reduced as a consequence of
changes in the certified tax rate under Section
59-2-924
pursuant to changes in
property valuation, if the school district applies the certified rate reduction
proportionally to the district's voted local levy, board local levy, and capital local
levy.
(b)
Subsection
(4)(a)
applies for a period of one year following a change in the certified
tax rate as described in Subsection
(4)(a)
.
(c)
Subsection
(4)(a)
does not apply if a school district:
(i)
does not apply the certified rate reduction proportionally to the district's local
levies in accordance with Subsection
(4)(a)
; or
(ii)
otherwise moves tax rate capacity from the board local levy or voted local levy
to the capital local levy.
(5)
(4)
The guarantee provided under this section does not apply to the portion of a voted
local levy rate that exceeds the voted local levy rate that was in effect for the previous
fiscal year, unless an increase in the voted local levy rate was authorized in an election
conducted on or after July 1 of the previous fiscal year and before December 2 of the
previous fiscal year.
(6)
(5)
A local school board of a school district that receives funds described in this section
shall budget and expend the funds for public education purposes.
(7)
(6)
(a)
Beginning with the 2026 fiscal year, the amount of state guarantee money
that a school district receives under this section may reduce as a result of changes in
the certified tax rate under Section
59-2-924
due to changes in property valuation.
(b)
For a school district receiving state guarantee money in excess of the amount the
school district would receive based solely on the current certified tax rate, the excess
funds:
(i)
may not cause the amount the school district receives to exceed the total amount
of state guarantee the school district received in the 2025 fiscal year; and
(ii)
shall diminish over a three-year period as follows:
(A)
in the 2026 fiscal year, the school district shall receive 100% of the excess
funds received in the 2025 fiscal year;
(B)
in the 2027 fiscal year, the school district shall receive 66% of the excess
funds received in the 2025 fiscal year;
(C)
in the 2028 fiscal year, the school district shall receive 33% of the excess
funds received in the 2025 fiscal year; and
(D)
in the 2029 fiscal year, the school district may not receive excess funds.
(c)
The state board shall:
(i)
calculate the amount of excess funds for each affected school district;
(ii)
notify each affected school district of the phase-out schedule for the excess funds
described in Subsection
(7)(b)
(6)(b)
; and
(iii)
oversee the phase-out process described in this Subsection
(7)
(6)
.
Section 2. Section
59-2-919
is amended to read:
59-2-919
. Notice and public hearing requirements for certain tax increases --
Exceptions -- Audit -- Limitation on budget increase -- Voting exception.
(1)
As used in this section:
(a)
"Additional ad valorem tax revenue" means ad valorem property tax revenue
generated by the portion of the tax rate that exceeds the taxing entity's certified tax
rate.
(b)
"Ad valorem tax revenue" means ad valorem property tax revenue not including
revenue from:
(i)
eligible new growth; or
(ii)
personal property that is:
(A)
assessed by a county assessor in accordance with Part
3, County Assessment
;
and
(B)
semiconductor manufacturing equipment.
(c)
"Base year" means a taxing entity's fiscal year that immediately precedes the fiscal
year in which the taxing entity first adopted a budget below last year's property tax
budgeted revenue.
(d)
"Base year budgeted revenue" means the property tax budgeted revenue, excluding
eligible new growth, for the base year.
(e)
"Calendar year taxing entity" means a taxing entity that operates under a fiscal year
that begins on January 1 and ends on December 31.
(f)
"County executive calendar year taxing entity" means a calendar year taxing entity
that operates under the county executive-council form of government described in
Section
17-62-203
.
(g)
"Current calendar year" means the calendar year immediately preceding the calendar
year for which a calendar year taxing entity seeks to levy a tax rate that exceeds the
calendar year taxing entity's certified tax rate.
(h)
"Eligible new growth" means the same as that term is defined in Section
59-2-924
.
(i)
"Fiscal year taxing entity" means a taxing entity that operates under a fiscal year that
begins on July 1 and ends on June 30.
(j)
"Meeting" means the same as that term is defined in Section
52-4-103
.
(k)
(j)
(i)
"Last year's property tax budgeted revenue" means:
(A)
except for when a taxing entity submits a question in accordance with
Subsection
(12)
, the revenue a taxing entity budgeted to be generated from a
property tax levy for the previous fiscal year; and
(B)
when a taxing entity submits a question in accordance with Subsection
(12)
,
the revenue a taxing entity estimates to be generated and budgeted from a
property tax levy for the fiscal year before the fiscal year for which the taxing
entity submits a question.
(ii)
"Last year's property tax budgeted revenue" does not include:
(i)
(A)
revenue received by a taxing entity from a debt service levy voted on by
the public;
(ii)
(B)
revenue generated by the combined basic rate as defined in Section
53F-2-301
; or
(iii)
(C)
revenue generated by the charter school levy described in Section
53F-2-703
.
(l)
(k)
"Meeting" means the same as that term is defined in Section
52-4-103
.
(l)
"Truth-in-taxation exemption period" means a six-year period that begins with the
base year.
(2)
Except as provided in Subsection
(11)
, a taxing entity may not levy a tax rate that
exceeds the taxing entity's certified tax rate unless the taxing entity meets:
(a)
the requirements of this section that apply to the taxing entity; and
(b)
all other requirements as may be required by law.
(3)
(a)
Subject to Subsection
(3)(b)
and except as provided in
Subsection
Subsections

(5)

and
(12)
, a calendar year taxing entity may levy a tax rate that exceeds the calendar
year taxing entity's certified tax rate if the calendar year taxing entity:
(i)
14 or more days before the date of the regular general election or municipal
general election held in the current calendar year, states at a public meeting:
(A)
that the calendar year taxing entity intends to levy a tax rate that exceeds the
calendar year taxing entity's certified tax rate;
(B)
the dollar amount of and purpose for additional ad valorem tax revenue that
would be generated by the proposed increase in the certified tax rate; and
(C)
the approximate percentage increase in ad valorem tax revenue for the taxing
entity based on the proposed increase described in Subsection
(3)(a)(i)(B)
;
(ii)
provides notice for the public meeting described in Subsection
(3)(a)(i)
in
accordance with Title
52, Chapter 4
, Open and Public Meetings Act, including
providing a separate item on the meeting agenda that notifies the public that the
calendar year taxing entity intends to make the statement described in Subsection
(3)(a)(i)
;
(iii)
meets the advertisement requirements of Subsections
(6)
and
(7)
before the
calendar year taxing entity conducts the public hearing required by Subsection
(3)(a)(v)
;
(iv)
provides notice by mail:
(A)
seven or more days before the regular general election or municipal general
election held in the current calendar year; and
(B)
as provided in Subsection
(3)(c)
; and
(v)
conducts a public hearing that is held:
(A)
in accordance with Subsections
(8)
and
(9)
; and
(B)
in conjunction with the public hearing required by Section
17-63-304
or
17B-1-610
.
(b)
(i)
For a county executive calendar year taxing entity, the statement described in
Subsection
(3)(a)(i)
shall be made by the:
(A)
county council;
(B)
county executive; or
(C)
both the county council and county executive.
(ii)
If the county council makes the statement described in Subsection
(3)(a)(i)
or the
county council states a dollar amount of additional ad valorem tax revenue that is
greater than the amount of additional ad valorem tax revenue previously stated by
the county executive in accordance with Subsection
(3)(a)(i)
, the county executive
calendar year taxing entity shall:
(A)
make the statement described in Subsection
(3)(a)(i)
14 or more days before
the county executive calendar year taxing entity conducts the public hearing
under Subsection
(3)(a)(v)
; and
(B)
provide the notice required by Subsection
(3)(a)(iv)
14 or more days before
the county executive calendar year taxing entity conducts the public hearing
required by Subsection
(3)(a)(v)
.
(c)
The notice described in Subsection
(3)(a)(iv)
:
(i)
shall be mailed to each owner of property:
(A)
within the calendar year taxing entity; and
(B)
listed on the assessment roll;
(ii)
shall be printed on a separate form that:
(A)
is developed by the commission;
(B)
states at the top of the form, in bold upper-case type no smaller than 18 point
"NOTICE OF PROPOSED TAX INCREASE"; and
(C)
may be mailed with the notice required by Section
59-2-1317
;
(iii)
shall contain for each property described in Subsection
(3)(c)(i)
:
(A)
the value of the property for the current calendar year;
(B)
the tax on the property for the current calendar year; and
(C)
subject to Subsection
(3)(d)
, for the calendar year for which the calendar year
taxing entity seeks to levy a tax rate that exceeds the calendar year taxing
entity's certified tax rate, the estimated tax on the property;
(iv)
shall contain the following statement:
"[Insert name of taxing entity] is proposing a tax increase for [insert applicable calendar
year]. This notice contains estimates of the tax on your property and the proposed tax increase
on your property as a result of this tax increase. These estimates are calculated on the basis of
[insert previous applicable calendar year] data. The actual tax on your property and proposed
tax increase on your property may vary from this estimate.";
(v)
shall state the dollar amount of additional ad valorem tax revenue that would be
generated each year by the proposed increase in the certified tax rate;
(vi)
shall include a brief statement of the primary purpose for the proposed tax
increase, including the taxing entity's intended use of additional ad valorem tax
revenue described in Subsection
(3)(c)(v)
;
(vii)
shall state the date, time, and place of the public hearing described in Subsection
(3)(a)(v)
;
(viii)
shall state the Internet address for the taxing entity's public website;
(ix)
may contain other information approved by the commission; and
(x)
if sent in calendar year 2024, 2025, or 2026, shall contain:
(A)
notice that the taxpayer may request electronic notice as described in
Subsection
17-71-302(1)(m)
; and
(B)
instructions describing how to elect to receive a notice as described in
Subsection
17-71-302(1)(m)
.
(d)
For purposes of Subsection
(3)(c)(iii)(C)
, a calendar year taxing entity shall calculate
the estimated tax on property on the basis of:
(i)
data for the current calendar year; and
(ii)
the amount of additional ad valorem tax revenue stated in accordance with this
section.
(4)
Except as provided in
Subsection
Subsections

(5)
and
(12)
, a fiscal year taxing entity
may levy a tax rate that exceeds the fiscal year taxing entity's certified tax rate if the
fiscal year taxing entity:
(a)
provides notice by meeting the advertisement requirements of Subsections
(6)
and
(7)

before the fiscal year taxing entity conducts the public meeting at which the fiscal
year taxing entity's annual budget is adopted; and
(b)
conducts a public hearing in accordance with Subsections
(8)
and
(9)
before the
fiscal year taxing entity's annual budget is adopted.
(5)
(a)
A taxing entity is not required to meet the notice or public hearing requirements of
Subsection
(3)
or
(4)
if the taxing entity is expressly exempted by law from
complying with the requirements of this section.
(b)
A taxing entity is not required to meet the notice requirements of Subsection
(3)
or
(4)
if:
(i)
Section
53F-8-301
allows the taxing entity to levy a tax rate that exceeds that
certified tax rate without having to comply with the notice provisions of this
section; or
(ii)
the taxing entity:
(A)
budgeted less than $20,000 in ad valorem tax revenue for the previous fiscal
year; and
(B)
sets a budget during the current fiscal year of less than $20,000 of ad valorem
tax revenue.
(6)
(a)
Before holding the public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
, a
taxing entity proposing a tax rate increase under this section shall publish an
advertisement regarding the proposed tax increase:
(i)
electronically in accordance with Section
45-1-101
; and
(ii)
as a class A notice under Section
63G-30-102
.
(b)
The advertisement described in Subsection
(6)(a)
shall:
(i)
be published for at least 14 days before the day on which the taxing entity
conducts the public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
; and
(ii)
substantially be in the following form and content:
"NOTICE OF PROPOSED TAX INCREASE
(NAME OF TAXING ENTITY)
The (name of the taxing entity) is proposing to increase its property tax revenue.
The (name of the taxing entity) tax on a (insert the average value of a residence in
the taxing entity rounded to the nearest thousand dollars) residence would increase from
$______ to $________, which is $_______ per year.
The (name of the taxing entity) tax on a (insert the value of a business having the
same value as the average value of a residence in the taxing entity) business would increase
from $________ to $_______, which is $______ per year.
If the proposed budget is approved, (name of the taxing entity) would receive an
additional $______ in property tax revenue per year as a result of the tax increase.
If the proposed budget is approved, (name of the taxing entity) would increase its
property tax budgeted revenue by ___% above last year's property tax budgeted revenue
excluding eligible new growth.
The (name of the taxing entity) invites all concerned citizens to a public hearing for the
purpose of hearing comments regarding the proposed tax increase and to explain the reasons
for the proposed tax increase. You have the option to attend or participate in the public hearing
in person or online.
PUBLIC HEARING
Date/Time:
(date) (time)
Location:
(name of meeting place and address of meeting place)
Virtual Meeting Link:
(Internet address for remote participation and live streaming
options)
To obtain more information regarding the tax increase, citizens may contact the (name
of the taxing entity) at (phone number of taxing entity) or visit (Internet address for the taxing
entity's public website)."
(7)
The commission:
(a)
shall adopt rules in accordance with Title
63G, Chapter 3
, Utah Administrative
Rulemaking Act, governing the joint use of one advertisement described in
Subsection
(6)
by two or more taxing entities; and
(b)
subject to Section
45-1-101
, may authorize a taxing entity's use of a
commission-approved direct notice to each taxpayer if:
(i)
the direct notice is different and separate from the notice required under Section
59-2-919.1
; and
(ii)
the taxing entity petitions the commission for the use of a commission-approved
direct notice.
(8)
(a)
(i)
On or before June 1, a fiscal year taxing entity shall notify the commission
and the county auditor of the date, time, and place of the public hearing described
in Subsection
(4)(b)
.
(ii)
On or before October 1 of the current calendar year, a calendar year taxing entity
shall notify the commission and the county auditor of the date, time, and place of
the public hearing described in Subsection
(3)(a)(v)
.
(b)
(i)
A public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
shall be:
(A)
open to the public;
(B)
held at a meeting of the taxing entity with no items on the agenda other than
discussion and action on the taxing entity's intent to levy a tax rate that exceeds
the taxing entity's certified tax rate, the taxing entity's budget, a special
district's or special service district's fee implementation or increase, or a
combination of these items; and
(C)
available for individuals to attend or participate either in person or remotely
through electronic means.
(ii)
The governing body of a taxing entity conducting a public hearing described in
Subsection
(3)(a)(v)
or
(4)(b)
shall:
(A)
state the dollar amount of additional ad valorem tax revenue that would be
generated each year by the proposed increase in the certified tax rate;
(B)
explain the reasons for the proposed tax increase, including the taxing entity's
intended use of additional ad valorem tax revenue described in Subsection
(8)(b)(ii)(A)
;
(C)
if the county auditor compiles the list required by Section
59-2-919.2
, present
the list at the public hearing and make the list available on the taxing entity's
public website; and
(D)
provide an interested party desiring to be heard an opportunity to present oral
testimony within reasonable time limits and without unreasonable restriction
on the number of individuals allowed to make public comment.
(c)
(i)
Except as provided in Subsection
(8)(c)(ii)
, a taxing entity may not schedule a
public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
at the same time as the
public hearing of another overlapping taxing entity in the same county.
(ii)
The taxing entities in which the power to set tax levies is vested in the same
governing board or authority may consolidate the public hearings described in
Subsection
(3)(a)(v)
or
(4)(b)
into one public hearing.
(d)
The county auditor shall resolve any conflict in public hearing dates and times after
consultation with each affected taxing entity.
(e)
(i)
A taxing entity shall hold a public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
beginning at or after 6 p.m.
(ii)
If a taxing entity holds a public meeting for the purpose of addressing general
business of the taxing entity on the same date as a public hearing described in
Subsection
(3)(a)(v)
or
(4)(b)
, the public meeting addressing general business
items shall conclude before the beginning of the public hearing described in
Subsection
(3)(a)(v)
or
(4)(b)
.
(f)
(i)
Except as provided in Subsection
(8)(f)(ii)
, a taxing entity may not hold the
public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
on the same date as
another public hearing of the taxing entity.
(ii)
A taxing entity may hold the following hearings on the same date as a public
hearing described in Subsection
(3)(a)(v)
or
(4)(b)
:
(A)
a budget hearing;
(B)
if the taxing entity is a special district or a special service district, a fee
hearing described in Section
17B-1-643
;
(C)
if the taxing entity is a town, an enterprise fund hearing described in Section
10-5-107.5
; or
(D)
if the taxing entity is a city, an enterprise fund hearing described in Section
10-6-135.5
.
(9)
(a)
If a taxing entity does not make a final decision on budgeting additional ad
valorem tax revenue at a public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
,
the taxing entity shall:
(i)
announce at that public hearing the scheduled time and place of the next public
meeting at which the taxing entity will consider budgeting the additional ad
valorem tax revenue; and
(ii)
if the taxing entity is a fiscal year taxing entity, hold the public meeting described
in Subsection
(9)(a)(i)
before September 1.
(b)
A calendar year taxing entity may not adopt a final budget that budgets an amount of
additional ad valorem tax revenue that exceeds the largest amount of additional ad
valorem tax revenue stated at a public meeting under Subsection
(3)(a)(i)
.
(c)
A public hearing on levying a tax rate that exceeds a fiscal year taxing entity's
certified tax rate may coincide with a public hearing on the fiscal year taxing entity's
proposed annual budget.
(10)
(a)
A county auditor may conduct an audit to verify a taxing entity's compliance
with Subsection
(8)
.
(b)
If the county auditor, after completing an audit, finds that a taxing entity has failed to
meet the requirements of Subsection
(8)
, the county auditor shall prepare and submit
a report of the auditor's findings to the commission.
(c)
The commission may not certify a tax rate that exceeds a taxing entity's certified tax
rate if, on or before September 15 of the year in which the taxing entity is required to
hold the public hearing described in Subsection
(3)(a)(v)
or
(4)(b)
, the commission
determines that the taxing entity has failed to meet the requirements of Subsection
(8)
.
(11)
For a fiscal year within a truth-in-taxation exemption period, a taxing entity may adopt
a budget that is equal to or less than the base year budgeted revenue without complying
with this section.
(12)
(a)
A taxing entity may not adopt a final budget that budgets an amount of
additional ad valorem tax revenue that exceeds 5% of last year's property tax
budgeted revenue, excluding eligible new growth, without voter approval.
(b)
(i)
By majority vote of all members of the legislative body, a taxing entity may
submit a question to the voters of the taxing entity to authorize the taxing entity to
collect an amount of additional ad valorem tax revenue that exceeds 5% of last
year's property tax budgeted revenue.
(ii)
The question shall appear on a ballot for a general election that happens before
the start of the fiscal year in which the taxing entity seeks to collect an amount of
additional ad valorem tax revenue that exceeds 5% of last year's property tax
budgeted revenue.
(iii)
A taxing entity shall include the amount of additional ad valorem tax revenue in
the ballot question.
(c)
(i)
A taxing entity may not increase the property tax budget by more than the
amount listed in the question the taxing entity submits to the voters.
(ii)
A taxing entity may increase the property tax budget by less than the amount
listed in the question the taxing entity submits to the voters.
(d)
A taxing entity that receives voter approval on a question to increase the taxing
entity's additional ad valorem property tax revenue does not have to comply with the
notice and public hearing requirements described in this section for the fiscal year for
which the voters approved the increase.
Section 3.
Effective Date.
This bill takes effect on
July 1, 2026
.
2-4-26 9:39 AM