Property taxes are a key source of funding for cities, counties, school districts, and special districts in Arizona. They help pay for essential local services that directly impact daily life—including police and fire protection, parks, libraries, street maintenance, and more. The City’s portion of the total property tax bill is around 11%, with the majority of the property tax bill dedicated to school districts.

This guide explains the basics of property tax in Arizona, including how taxes are structured, what they fund, and how state law regulates the process.

Property tax is a levy imposed on real property (land, buildings, and certain business equipment) based on the property's assessed value. The Maricopa County Assessor’s Office determines the value of most taxable property within the county, and local governments (like cities, counties, and schools, including Avondale) apply a tax rate to that value to generate revenue.

In Arizona, property taxes are divided into two categories. Primary property tax supports day-to-day government operations; secondary property tax repays long-term capital project debt approved by voters.

1. Primary Property Tax

• Used to fund the daily operations of local government such as public safety, parks, libraries, and administration.
• Growth in primary property tax is limited by state law to ensure stability and predictability for property owners.
• Authorized under A.R.S. § 42-17151 and subject to levy limits in A.R.S. § 42-17051.

2. Secondary Property Tax

• Used only to pay debt associated with projects approved by voters, known as general obligation bonds, for building new infrastructure like fire stations, libraries, roads, or wastewater infrastructure.
• Cannot be used for operational expenses, like salaries or on-going services.
• Governed by A.R.S. § 35-451 and related Arizona laws on municipal bonding.

These two terms are often confused, but they refer to different things.

• Levy = Total dollars collected.
• Rate = The percentage charged to each property’s value to meet the levy goal.

Even if the tax rate stays the same, your tax bill can change if your property’s assessed value changes.

• Property Tax Levy (A.R.S. § 42-17107)
• The total amount of money the City plans to collect from all property owners combined in a given year.
• Set by the City Council during the budget process
• This is the City’s revenue target—not the rate itself.
• Property Tax Rate (A.R..S. § 42-17151(A))
• The rate (expressed per $100 of net assessed value) that is applied to each property to generate the total levy. This is a percentage applied to the value of property to determine how much tax is owed.
• Determined by dividing the total levy by the jurisdiction’s net assessed valuation.

Arizona’s Truth in Taxation Law (A.R.S. § 42-17107(A))

Arizona’s Truth in Taxation law ensures transparency when cities, counties, and other taxing jurisdictions increase primary property tax collections beyond natural growth from new construction.

If the City plans to increase the primary property tax levy beyond what would be collected based solely on new construction, it must:

1. Publish notice of the tax increase in a newspaper or official website.
2. Hold a public hearing for residents to provide comments.
3. Adopt the tax increase by roll call vote at a public meeting.
• Avondale City Council generally holds this meeting each June as part of the annual budget adoption process.

The change in the primary tax levy consists of two parts: the first is growth which is new development that didn’t exist in the prior year tax base. The second part is the increase to the levy which per state statute can increase in aggregate 2% each year.

Truth in Taxation requires clear notice and opportunity for input when tax collections rise for reasons other than growth in the tax base, like the 2% increase in the total primary property tax levy permitted annually by state statute.

Additional Resources

Arizona Revised Statutes (A.R.S.) – Title 42, Taxation:

https://www.azleg.gov/arsDetail/?title=42

Maricopa County Assessor – Understanding your valuation:

https://mcassessor.maricopa.gov/

Government Property Lease Excise Tax
City of Avondale leases reported to Arizona Department of Revenue under A.R.S. 42-6202 (D),(E).