By Lee Davidson
The Salt Lake Tribune
Published: July 23, 2011 12:02AM
Residents of 35 local governments in Utah will find bad news arriving in their mailboxes during the next week: proposed property tax hikes, announced in annual property tax valuation notices.
The increases will range from a $151.80 bump on a $200,000 home in Salem, Utah County, to a fairly modest increase of just $3.85 on a similar home in Nibley, Cache County.
The valuation notices will show how much cities, counties, school districts and special-service districts propose to charge each property this year. For entities seeking tax hikes, notices will include a schedule of Truth in Taxation hearings in August in which residents may try to persuade officials to lower increases.
City officials, at least, may be especially attentive because it is an election year for them. That may also be why the number of tax increases are down a bit this year compared to the long term.
The 35 local governments proposing to raise taxes make up about 7 percent of the 520 or so such governments in the state. (See the chart for a list of all governments proposing tax hikes.)
By comparison, in 2008 (a nonelection year for cities) 81 local governments raised taxes — or more than twice the number this year. In 2009, 56 did. But last year in 2010, just 28 did as most tried to hold the line during tough economic times.
Royce Van Tassell, vice president of the watchdog Utah Taxpayers Association, says Utah’s Truth in Taxation laws make it painful politically for local officials to raise taxes, especially in an election year. If they propose property tax rates that would generate more revenue than the previous year, they must advertise and hold hearings to explain why to residents.
“The Truth in Taxation law is working and requiring elected officials to be honest and transparent on what they actually need. Most are proposing tax increases only when the need is real,” Van Tassell said.
Salem Mayor Tom Cope says his city “has not raised any property taxes for over 30 years.” But he said that has caught up with the city now, and it has no choice but to increase them to keep offering essential services. The proposed hike is $151.80 on a $200,000 home, the largest increase in the state, and double the size of last year’s taxes.
“It’s time to make an adjustment and build a tax base that is solid,” he said.
He was appointed as mayor a year ago, and faces his first election this year. “I can’t worry about that. I’m trying to place the city in good solid ground and get things established for the future, and let the chips fall where they may,” Cope said.
Marysvale, in Piute County, is proposing a tax hike that is nearly as large: $151.14 on a $200,000 home, and about triple the amount of last year.
“We haven’t raised property taxes in a long time,” said Marysvale Mayor Wade Fautin. “The recession has made it tougher. We’re not getting as much from sales tax.” He said the city had not been passing on increased costs to taxpayers, and had been delaying needed work in recent years.
“But our roads are getting run down, because there hasn’t been enough money to keep them up,” he said. The tax increase would help solve that. “It’s pretty big. No doubt, it won’t be too popular.”
Some cities say large proposed tax increases aren’t quite what they seem, and actually are replacing other charges so that what citizens pay overall should be about the same.
For example, Centerfield in Sanpete County is proposing an increase of $113.74 on a $200,000 home to replace a separate fee it had charged for police service.
“Our wonderful Legislature won’t let us charge a police fee anymore, so we’re replacing it with higher property tax,” said Centerfield Mayor Tom Sorensen. “Residents will probably pay about the same overall.”
In Big Water, Kane County, the city is proposing to increase taxes by $115.06 on a $200,000 home. But City Council member Jennie Lassen says it will fund the city’s taking over of the fire service that had been offered by a special service district. Between the city raising taxes and the special service district lowering its rates, “residents should come out about the same,” she said.
Van Tassell, of the Taxpayers Association, says while it figures most tax increases are for real needs, his organization is raising questions about some.
It doesn’t like West Valley City’s proposed 18 percent hike, amounting to $76.23 on a $200,000 home. The city has said it is needed to make up for a shortfall in sales taxes during tough economic times.
But Van Tassell said the revenue it would generate is almost exactly what it would pay to UTOPIA, the Utah Telecommunication Open Infrastructure Agency organized in 2002 by community leaders statewide who believed Utah’s private telecommunications providers were unwilling to bring high-speed Internet and other broadband services to their cities.
Eleven cities have pledged more than $500 million over 32 years to back bonds to finance network construction. The amounts of their pledges are based on population; the biggest municipality is West Valley City, which will pay about $3.5 million in fiscal 2012 toward its total obligation of $185 million.
Van Tassell said the city has one of the highest property tax burdens in the state already without such spending, and notes that private companies provide high-speed internet there.
Van Tassell said his group also questions Salt Lake City’s proposed tax hike of $8.91 on a $200,000 home. He complains that is to help pay for a one-time library expansion project — and says the city should have asked voters to approve a bond instead of increasing taxes indefinitely.