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Tooele County audit puts faith in deep cuts, tax hike

Published July 20, 2013 4:54 pm

Fiscal crisis • Officials acknowledge painful choices but say county has turned a corner.
This is an archived article that was published on sltrib.com in 2013, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Tooele County's financial recovery plan — which already has produced deep staff and service cuts and is proposed to produce a 66 percent property-tax increase by year's end — is expected to restore the beleaguered county to fiscal well-being within three to five years.

"We believe that plan is viable," said Randy Jensen, senior audit partner with Haynie and Company, which presented its 2012 financial audit of Tooele County to the County Commission on Tuesday. "They've already enacted most of it and the tax increase is the only thing left."

It will be Tooele County's first property tax increase in 27 years. Tooele will drop from having the lowest property-tax levy among Utah's 29 counties to the fourth lowest.

Tooele County ended up in severe financial distress from a series of misfortunes, missteps and missed signals, including the Great Recession and waste-mitigation fees that dwindled after being robust and reliable.

Since 2012, county revenues shrank by $5.4 million — eliminating almost one-fourth of the general fund budget. The county's reserve or rainy day fund ran dangerously low. Questions arose as to whether there would be enough cash to meet April's payroll.

Also, between 2009 and 2012, officials transferred $6.5 million in loans from internal and restricted accounts to keep the heavily subsidized Deseret Peak recreation complex afloat. Allowed under state law as temporary measures, those loans must be paid back at some point.

Starting in 2012 and extending into May 2013, the county began a series of layoffs. Along with attrition, the cuts trimmed the county workforce from 418 to 300 employees. Deseret Peak's popular outdoor pool was closed this summer. Tooele's relief services were handed off to Valley Mental Health.

"There isn't a department that escaped this unscathed," said Commissioner Shawn Milne, who took office in January. "This was all necessary just to make sure that we stopped what had become a trend in the wrong direction."The audit confirmed what commissioners already knew: The fund balance was $3 million in the hole, Milne added.

"That means you have nothing," he said. "There it was in black and white."

Milne believes a systemic breakdown in communication occurred between the various parties that oversee the many moving parts of the county's financial operation.

"

I believe county officials would have acted differently if the information had been conveyed in a plain manner," Milne said. "It's been a very painful experience. Every one of us has learned a lot."

So far, commissioners have hosted three town hall meetings regarding the pending tax increase. Two more are scheduled before an Aug. 20 Truth in Taxation hearing.

According to Commission Chairman Bruce Clegg, those town-hall sessions were not required, but have helped to better inform residents of the fiscal situation."Nobody wants their taxes raised, and I don't either," Clegg said. "But as we explain things to them and they see the situation, a lot of our citizens are giving us good support."

Homeowners can expect a 6 to 8 percent increase in their total property tax bill, Milne said. On a $150,000 home, the levy rises $73 per year. For a $150,000 business, it increases $134.

For county coffers, it means an additional $2.6 million in annual revenues — and the chance to recover.

"We feel like we've turned a corner and things are going to start improving financially," Clegg said. "If we don't have an unforeseen expense, we're moving ahead."

cmckitrick@sltrib.com

twitter: @catmck —

Town-hall meetings set on tax increase

P Tuesday • 7 p.m., Stockton Miners Cafe, 47 N. Conner Ave., Stockton

Aug. 13 • 7 p.m., Tooele High School auditorium, 301 W. Vine St., Tooele