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Look who is raising property taxes in Utah

Published July 23, 2012 9:00 am

Government • All over Utah, from big Salt Lake County to tiny Manila, 27 entities plan to boost property levies.
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

As annual valuation notices hit mailboxes in the next week, most Utahns will find good news: Only one of every 20 local governments in Utah is proposing a property tax hike this year.

But those increases, in some case, would be huge.

For example, Manila — the small county seat of Daggett County — proposes to more than double its share of property taxes from $73.92 on a $200,000 home to $161.92.

Harrisville, in Weber County, also seeks to more than double its property taxes, from $81.18 on a $200,000 home to $164.67.

Hikes proposed statewide range from a new $219.89 tax on a $200,000 home in unincorporated Salt Lake County — to replace a much-despised police fee there — to a modest $2.20 jump on a $200,000 home in West Valley City. A list of all proposed hikes is online at sltrib.com.

Data collected by the Utah Tax Commission show that 27 local governments — out of about 520 cities, counties, school districts and special districts — seek property tax boosts. Valuation notices include a schedule of required Truth in Taxation public hearings in August before hikes may become final. The number of proposed increases has been lower in recent years since the peak of the recession, when 81 governments raised property taxes in 2008.

"Local governments have had to make a number of cuts in years past as the economy slowed," said Royce Van Tassell, vice president of the business-backed Utah Taxpayers Association. "They recognize that raising taxes in our current shaky economy, where we are recovering but slowly, is not the way to keep the economy moving forward."

Van Tassell also credits Utah's Truth in Taxation law for creating political pressure to avoid tax increases. If governments propose tax rates that would generate more revenue than the previous year, they must advertise and hold public hearings. Those meetings sometimes attract hundreds of upset taxpayers and threaten political futures.

"It's been one of the most successful programs," Van Tassell said, "for retarding property tax increases."

Reflecting how politically painful raising taxes can be, leaders proposing to do so this year often say they put it off as long as possible.

"We have not raised our taxes since the 1980s," said Manila Mayor Chuck Dickison, explaining the proposed doubling there this year. "We try to treat our citizens well, and it [not boosting taxes] has come back to haunt us. We just can't sustain it any longer, and perhaps we should have done it [raise taxes] in a different manner with increments."

He said the proposed increase is needed to handle needed road maintenance, water system costs and a new fire station. "We have to catch up to do our roads and pay our bills," he said.

Similarly, Harrisville City Administrator Bill Morris said his city "had not raised taxes in years." He said it may raise them now to try to retain employees, noting his city trains many workers only to see them jump to other municipalities for higher pay. He said the city is also considering contracting with Weber County for police service, which may avoid a tax hike.

Kerry Eppich, general manager of the Salt Lake City Suburban Sanitary District No. 1, covering much of the Salt Lake Valley's east side, said, "We haven't increased our taxes in over 20 years. ... The policy of the district has been to hold them as low as possible for as long as possible."

But, he said, "most of our lines are over 30 years old, with quite a number that are over 50. It's getting to the point where we need to do some rehabilitation."

So the district is proposing a nearly 90 percent tax hike.

Van Tassell said the taxpayers association does not oppose raising taxes when needed but added that some proposals this year are not necessary or could have been avoided. He points to a planned 50 percent tax hike in Orem as an example.

"They are doing this because they got themselves mired in UTOPIA," an Internet provider financially backed by many Utah cities, which cannot meet its obligations. "Now they are asking taxpayers there to bail them out. ... There are a number of tax cuts they could make instead."

But Jamie Davidson, Orem's assistant city manager, said the city had tapped reserves in past years to make required UTOPIA payments, but those are now depleted. He said the last time the city had a general operation tax increase was 1978, adding that Orem needs the extra revenue not only for UTOPIA but also for long-delayed maintenance on city facilities.

Van Tassell also balks at a proposed 58 percent tax hike in Highland. He said the Utah County city used all its bonding authority to build "some Taj Mahal-like facilities" and now cannot borrow for needed road work, so it's pursuing a tax increase instead. He worries when roads are fixed, taxes will not be lowered but will remain higher.

Highland City Administrator John Park said a study found that his city needs an extra $600,000 in road maintenance each year just to keep them from worsening — and needs $20 million to rebuild its worst streets.

Van Tassell applauds the state's largest new tax — nearly $220 on a $200,000 home in unincorporated Salt Lake County to replace a police fee that was outlawed by the Legislature. He said switching the fee to a property tax makes sense.

"Property taxes are designed to pay for the public good," he said, "and certainly law enforcement is a public good. ... Everyone benefits from having crime taken care of." —

Largest proposed property tax hikes

Increases proposed by local governments on a $200,000 home this year:

• Manila: 119 percent increase, up $88.

• Harrisville: 103 percent increase, up $83.49.

• Salt Lake City Suburban Sanitary District No. 1: 90 percent increase, up $20.35.

• Uintah City: 76 percent increase, up $61.49.

•Highland, 58 percent increase, up $127.82.

Source: Salt Lake Tribune analysis of Utah Tax Commission data. All proposed hikes are online at sltrib.com.