In November, voters in 17 of Utah’s 29 counties will be asked if their county should increase its sales tax rate by 0.25% in order to pay for transportation and mass transit-related projects within their boundaries. The increase is on the ballot in the 17 counties due to the county commission or council in that county voting to place the tax increase question on the ballot.
If the increase is passed, 40% of the additional revenue from the tax increase will go to each of the cities within the county that raises the tax. Another 40% of the increase will go to the mass transit district operating within the county (e.g. Utah Transit Authority), while the final 20% of the increase will be distributed to the county. For counties without a mass transit organization, the revenue will be split with 60% being received by the counties and 40% going to the cities.
The Utah Taxpayers Association has evaluated the proposed local option sales tax and provides the following information for consideration:
- Transportation funding is essential to keeping Utah’s economy moving. With our state’s expected population growth, cities, counties and the state need to make certain Utah has quality transportation infrastructure that supports population and economic growth.
- This isn’t just about building roads and filling potholes, it provides transportation choices. The local option sales tax also allows cities and counties to build bicycle lanes, walking trails and to fund public
- Along the Wasatch Front, the Utah Transit Authority has pledged that any additional funds from this increase will go towards extending the system’s bus services. If passed, money will pay for buses to run more often, have earlier start times and additional late night service.
- The local option sales tax proposed will address a shortfall in many county and cities’ transportation budgets.
- Cities and counties may work together to identify priorities in their transportation infrastructure to better address joint needs, using the additional revenue.
- Utahns are already overtaxed. The Legislature raised taxes $151 million earlier this year to fund transportation and education. If Proposition 1 is passed in the counties who have placed it on the ballot, it would raise taxes another $97 million. The increase would equal out to be a $38 per year increase on the residents in those counties.
- Transportation needs are best funded by the users of the services. Sales taxes do not have a close correlation to those who use the roads. User fees, such as a gas tax or vehicle miles traveled program, can create a more equitable solution.
- Additional transportation funding should be uniform statewide, rather than a select few counties.
- Sales taxes are regressive, falling hardest on those least able to pay.
- Increasing the sales tax rate will hurt Utah’s local retailers who compete with out-of-state online retailers that do not collect sales taxes.
- Placing a tax increase county by county creates a patchwork of tax rates and a patchwork of funding for transportation, leading to confusion and citizens traveling to other counties with lower rates to make major purchases.
The chart below displays the amount of money that would be raised by each of the counties on this year’s ballot, if voters approve the tax increase.
|Sales Tax Increase on the Ballot|
|County||Tax Increase Amount|
The following chart shows the number of miles that are maintained by counties and cities in each individual county, as well as the percentages of funding each entity would receive if voters approve the local option sales tax. The counties shaded in blue are those that have placed the tax increase on the ballot this November.
|Local Option Sales Tax: County vs. City Weighted Roads|
|with Distribution of Revenue under Proposition 1|
|County||City Roads||County Roads||Total Road Miles||Percent of County Roads||Percent of City Roads||Percent to Counties||Percent to Cities||Percent to Transit Districts|
|Shaded lines are those considering local option sales tax on the 2015 ballot|