by Dr. Patrick Jones
There is nothing more certain that death and taxes. But what about the certainty that taxes always go up? The graph of the property tax roll of all jurisdictions in Walla Walla County would certainly lend credence to the second claim. That is, except for pandemic outbreak year 2020, when property taxes actually declined in the county. Note that this is not the average property tax paid a resident, but total property tax raised from all sources – residential, commercial, industrial and agricultural.
Property taxes are certainly important to the “collectors” – either the state or local governments. The indicator on the total property tax roll shows recent history to be one of the tax roll increasing year after year.
But due to state law, the maximum the overall existing property tax base can increase annually is 1%, in most cases. The exception is a “levy lid lift,” a decision by voters to exceed the 1% rule.
Another, and undoubtedly the more common way for the property tax base to expand, is through new construction or improvements of existing buildings. Typically, increases in the tax roll then occur due to an increase in the tax base, or stock of real property, and not a percentage rate jump.
And how has the total tax roll in the county moved over the last few years? Over the pandemic and post-pandemic period 2019-2024, by about 33% cumulatively. Over the decade 2015-2024, by about 39% cumulatively. These totals compute to annual increases far greater than 1%, assuming the elected officials opted to even take a 1% total increase. Consequently, it seems clear that the cumulative increase clearly represents an economy that wasn’t stagnant but investing in new structures or modifying existing ones.
It is perhaps more interesting for viewers to know what the per person tax roll computes to. As the graph shows, in 2024 it was about $1,544 in the county. This is much lower than the state-wide average of $2,237. For every year the measure tracks, the per capita tax roll here is much lower than throughout the state. Clearly, residents here deal with a relatively lower tax roll than their compatriots in other counties.
Over the pandemic and post-pandemic period, the per capita property tax take here climbed a little less, at 30%, than the overall property tax take. This doesn’t indicate, however, that residents had paid, on a cumulative basis, more property taxes. Rather, it indicates that the tax base has grown a bit faster than population, and very likely due to commercial and industrial new construction or improvements.
Interestingly, the increase state-wide over the same period, 2019-2024, was just about the same, on a per capita basis.
To put the growth of the tax base into some perspective, it is helpful to juxtapose against the growth of the economy. This can be done by examining the growth in personal income over the same period. On a per capita basis, net of the Penitentiary population, Walla Walla County personal income rose by a cumulative 23 % over the 2019-2024 period. Since there was some, but not a lot, of growth in population in the county over the same period, it’s not surprising that total personal income grew a bit faster, at 27% over these years.
So the property tax roll increased faster, at 33%, than personal income expanded, whether per capita or total. There is nothing in economics that states that personal income growth must match strides with property tax growth, so we shouldn’t make too much of it. For example, in an “asset-light” economy (think of one with a concentration of software industries) where much of the economy doesn’t depend on buildings, one might see the reverse: personal income grows faster than the property tax base.
The higher rate of the property tax roll, even if close to the growth rate of total personal income, tells me that Walla Walla County doesn’t depend too much on asset-light industries. Buildings matter here. How might the county bolster its property tax roll? The announced projects for the western part of the county will help.