City council makes decision on whether to raise property taxes

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PHOENIX -- The property tax in Phoenix has not changed for 14 years and it will be at least two more years before any changes are made.

The Phoenix City Council voted Tuesday to keep the current fixed combined property-tax rate. If the problems continue in two years as far as property values, the city council can either take a vote to change the secondary tax rate, change the primary tax rate or dip into the city's general fund to cover debt.

Supporters of the hike, including Phoenix Mayor Phil Gordon, said the tax was needed to cover a $150 million budget shortfall.

"Because of our budgeting process, our taxpayers will actually -- if it's adopted -- they will be paying less than they paid last year and less for the next five years, and then go back to the rate that's been in existence," Gordon said. "It's a floating rate that will guarantee that they won't be paying any more than they're paying now."

Opponents like Councilman Sal DiCiccio, who was also against the recently implemented food tax, says residents are already overtaxed.

"What the City of Phoenix is looking to pass today is a tax hike for the next 15 years on the public," DiCiccio said. "I think that that's wrong. ... I believe that we can restructure our operations internally and accept responsibility for our mismanagement -- for the city's mismanagement -- rather than putting it on the shoulders of the taxpayers."

If approved, the primary property tax levy will go up by 2 percent each year. That secondary rate will float, which means, homeowners will not pay that higher rate until 2013.

Phoenix is the only municipality in the state that has a fixed combined property tax rate -- $1.82 per $100. That has not changed in 14 years.