FARMINGTON — Residents in the Aztec and Bloomfield school districts will see a considerable increase in their property taxes due to a decrease in San Juan County oil and gas production last year.
As a result, administrators at both school districts say they are being more judicious with funds and are considering delaying future bond proposals.
During a Sept. 11 special meeting of the San Juan County Commission, commissioners approved the 2013 property taxes rates, which go into effect in November.
The decreased value in oil and gas production led to a loss of property values, which created the need to raise the mill rate, said San Juan County Assessor Clyde Ward.
"When valuation drops in one area, the mill rate would have to come up to pay that debt," Ward said.
Homeowners in the Bloomfield School District will see the biggest change with a $2.396 increase per $1,000 net taxable value of a home. The new total annual rate will be $11.303, up from last year's rate of $8.907.
For a home valued at $150,000, $50,000 would be taxable, creating an annual increase of $119.80. Under the new rate, that homeowner would pay a total of $565.15 in property taxes on school district debt.
In Aztec, the property tax rate will increase by $1.931 to $10.597. This will cause an annual increase of $96.55 to a home valued at $150,000. Last year's school district debt service rate was $8.666. With this year's increase, that homeowner would pay $529.85 in property taxes on school district debt.
The Farmington Municipal School District saw a minor drop in its property tax rate. The rate dropped $0.005 to $9.746. The Central Consolidated School District will see an increase of $0.064 to $9.150, causing an annual increase of $3.20 for a $150,000 home.
The Bloomfield School District will have to wait at least five years before asking voters to approve another bond, said Gary Giron, director of finance and operation for the district.
Bonding capacity is determined on the value of property and oil and gas sold.
In an email, Giron said the value of oil and gas in Bloomfield's tax base declined from a little more than $755 million in fiscal year 2009-2010 to a little more than $315 million in 2013-2014, resulting in a loss of more than $440 million.
The decline in value led to an $26.4 million loss of bonding capacity for the district.
Voters approved the last Bloomfield bond election on Feb. 3, 2009, for a $35 million bond. Only $18 million in bonds were sold before the economic downturn. The district decided to not proceed with selling the remaining $17 million, which would have exceeded their bonding capacity.
Giron estimated the earliest the district might pursue another bond election would be fall 2018, and that will depend on oil and gas production.
Also reacting to economic downturn, the Aztec Municipal School District has not sold any of the $17 million in bonds voters approved in 2012.
Aztec Superintendent Kirk Carpenter said the property tax increase is very discouraging, adding that the district's bonding capacity is at 98.43 percent or about $660,000.
"Not having any bonding capacity, it's getting very serious," Carpenter said. "Things are getting older, and as they get older, it gets expensive to repair."
Carpenter said the district's tax base in 2007 was a little more than $1.46 billion and this year's tax base is a little more than $706 million, a loss of more than 48 percent.
Technology purchases -- like upgrading computers and equipment and repairing roofs, heating and ventilation -- are on hold. The biggest project planned from the 2012 bond was a new fieldhouse for Fred Cook Memorial Stadium.
The school district has four years from when voters approve a bond to act before the ability to sell the bonds expires.
"We're very conscious about what we do with the tax rates," Carpenter said.