Did Truth in Taxation law backfire? It led many Utah cities to dodge tax hikes for years, only to double them now.

(Steve Griffin | The Salt Lake Tribune) Retiree and activist Ed Reot speaks about how tax increases have affected his fixed income during an Americans for Prosperity-Utah (AFP-UT) news conference at the Utah Capitol in 2017. AFP-UT says the Our Schools Now tax hike proposal is wrong for Utah schools, families and small-business owners.

Cue the taxpayers’ pitchforks and torches: Tooele City is proposing to more than double its share of property tax this year, by 114.9 percent, the highest in the state.

It isn’t the only Utah city aiming to double property taxes. So are Spring City and Monroe.

Five others plan to raise them by between 50 percent and 85 percent: Scofield, Richmond, Smithfield, Apple Valley and Stockton. Three more propose hikes of between 25 percent and 49 percent: Murray, Enoch and Payson.

That almost makes Cottonwood Heights' proposed 21.9 percent spike seem like a bargain.

These cities are among 53 cities, towns, school districts, water districts and special districts that are seeking to raise property taxes this year, according to the Utah State Tax Commission.

Ironically, many of the biggest jumps may come because Utah’s 33-year-old Truth in Taxation law, designed to help keep taxes low, worked a tad too well for too long. Officials say some of the huge hikes now are coming to make up for that.

That law requires a public hearing — often full of angry, threatening voters — whenever a local government proposes to raise property tax revenues beyond what it collected the previous year, plus the extra generated by any new growth. Such hearings for proposed tax hikes this year will occur throughout August.

“Some officials said after taxpayers showed up with pitchforks and hanging rope, they would rather run across the state naked than go through Truth in Taxation again,” says retiring Sen. Howard Stephenson, R-Draper, who is also president of the business-backed Utah Taxpayers Association and helped pass that law in 1985 as a lobbyist.

Steve Griffin / The Salt Lake Tribune Sen. Howard Stephenson, R-Draper.

So, he says, many officials tried too hard to avoid those hearings.

Stephenson says he and others initially believed local governments would go through the Truth in Taxation process every five to eight years to keep up with inflation. “We found they had a lot less courage to raise taxes than we anticipated” and waited much longer — often bringing truly big increases when they came.

He adds, “A lot of people say this is tax limitation. No, it’s not. It’s just tax transparency. It does nothing to prevent elected officials from increasing tax levels at any level they want” — if they can make a politically supportable case for it.

With Truth in Taxation, Stephenson notes, Utah dropped from No. 24 highest for property taxes in the nation in 1985 to 34th now — and for primary homes (which receive discounts not given to vacation homes or commercial property) it ranks 43rd.

Big hikes follow years of no hikes

Several cities proposing the biggest increases this year blame them partly on a lack of courage by past leaders to go through Truth in Taxation when needed.

Debbie Winn, the recently elected mayor of Tooele, with the state’s highest proposed increase of 114.9 percent, or $221 on a median-priced home there, says, “It has been 36 years since the city raised taxes. … The policy of previous administrations was more political: ‘We won’t raise your taxes.’”

She says the city had been tapping savings to meet financial obligations in recent years, but that money is largely gone. It now needs to catch up with inflation and meet other needs — such as boosting the pay for police to reduce turnover.

Rick Egan | The Salt Lake Tribune Douglas and Char Gray, from Farmington, play the Overlake Golf Course near Tooele, Monday, June 21, 2010.

“We average 65 percent turnover every three to five years for our officers. They leave for more money and more benefits,” she says. The city also is trying to raise pay for other workers and construct a new public safety building.

What happened when voters heard their taxes may double? “The overwhelming response was that the residents were not happy,” Winn says, “but that they understood this had to take place. Many comments were made that they wished we had done it a little at a time. Hindsight is always 20/20.”

Not far from Tooele is Stockton, which proposes a 50 percent tax hike of $166 on a median-priced home there. Mayor Thomas Karjola says taxes there had not been raised in at least 15 years.

“Of course, the cost of business has gone up. You’ve got to pay to keep the town going,” he says.

“We have the lowest-paid police chief in the state. We can’t afford health insurance for our full-time employees. We don’t have money to repair our roads. We have an aging fleet of vehicles, and no money was set aside to replace them,” Karjola adds. “We need a new shop, but no one’s ever saved up money for a new shop.”

Proposed property tax increases, 2018

Tooele City
Spring City
Apple Valley Town
Cottonwood Heights
Ogden City - Special levy to purchase WBWCD water
West Jordan
South Ogden
North Tooele City Special Service District
North Davis Fire District
Park City School District
Garfield County School District
Jordan Valley Water Conservancy District
Ogden City School District
Spanish Fork
Wasatch County School District
Beaver County School District
Logan City School District
Central Utah Water Conservancy District
Provo School District
Duchesne County School District
South Jordan
Daggett County School District
South Summit School District
Salt Lake City
Weber County School District
Alpine School District
Sevier County School District
North Logan
Salt Lake City Library
West Valley City

Source: Utah State Tax Commission

More examples

Sanpete County’s Spring City has the state’s second-highest proposed tax hike by percentage: 105.7 percent, or $93 on a median-priced home there. City Clerk Dixie Earl says she cannot remember the last time her town had a tax increase.

“It was a long, long time ago. Our council refused to increase taxes every time," Earl says. "But we’re in a corner now,” and a tax hike is needed to save the city’s police and fire protection.

She adds the council may reduce the proposed hike. She says the city temporarily planned to lift taxes to the same level charged by nearby Fountain Green, hoping to match its services. But it may trim that.

The third-highest proposed tax increase in the state was in Monroe, Sevier County. The 100.3 percent hike would cost $95 on a median-priced home.

“We haven’t had a tax increase for at least 40 years," Mayor Johnny Parsons says.

But he says the biggest reason for it now is that the city’s 24 miles of asphalt roads are deteriorating. “We’re about to lose our roads if we don’t do something.” He says a study estimates needed repairs at $7 million, and the town is raising taxes enough to provide the local match for a hoped-for state loan to do the work.

Scofield is the smallest town in Utah — with 22 year-round residents but with many seasonal occupants who enjoy Scofield Reservoir — and is proposing the state’s fourth-largest tax hike by percentage: 84.8 percent, about $28 on a median-priced home.

(Morgan Jacobsen | Utah Division of Wildlife Resources) Three new fish species will be introduced to Scofield Reservoir. Hopefully, the fish will help control Utah chubs and make fishing for sportfish at the reservoir better.

Town Clerk Andrea Brady says Scofield has gone years without a major increase.

“We’re just trying to pay the bills," she says. The town had been covering them by transferring funds from utility collections, but she says it is fairer to use property taxes instead.

Salt Lake County tax increases

Several areas in Salt Lake County are calling for property tax increases.

The largest is in Murray — a 47 percent jump that would cost $135.58 on a median-priced home there. “The city has not realized a property tax increase in 12 years, yet the cost of providing services and infrastructure has increased considerably,” says a written City Council message to residents.

It says all of the additional money will go to help improve public safety, including bringing pay for police and firefighters up to the market average for their positions.

Cottonwood Heights proposes a 21.9 percent boost, which would cost $95.71 on a median-priced home. “We have not raised property tax in the 13 years that we have been incorporated,” says Assistant City Manager Bryce Haderlie.

He says the hike is needed to keep pace with inflation and continue basic services. The city also wants to put more money into roads, improve snow removal and raise employee wages to remain competitive.

Millcreek is proposing what is technically an eye-popping leap of 3,145 percent, or $424 on a median-priced home. But Finance Director Laurie Johnson says the city is collecting — and lowering — taxes that had been collected separately by the Salt Lake Valley Law Enforcement Service Area (SLVLESA).

“So, for example, it actually is lowering the mayor’s overall property tax bill by $40,” she says. The city is staying with the Unified Police Department, but changing how it collects the taxes to pay for it — raisig taxes locally to pay for its policing costs, instead of having SLVLESA collect it as part of its district.

(Trent Nelson | The Salt Lake Tribune) Dignitaries cut the ribbon as the City of Millcreek celebrates its first birthday and grand opening of its City Hall, Wednesday, Jan. 10, 2018.

Herriman is moving to start its own police agency and created its own special police district to collect what residents had been paying to SLVLESA, so it looks like a $373 increase on their property valuation notices.

But Herriman spokeswoman Tami Moody says taxes essentially will be the same that residents would have paid before the shift. She says SLVLESA was proposing a small increase, and the city is matching that.

Elsewhere in the county, West Jordan is proposing an 18.8 percent tax hike ($55.75 on a median-priced home); Alta seeks a 7.7 percent raise ($79.59 on a median-priced home); South Jordan, 4.9 percent ($18.99); Salt Lake City, 2.6 percent ($18.86); and West Valley City, 0.7 percent ($3.28).

Small percentage, big tab

Some of the proposed property tax hikes this year may be small percentagewise but carry high dollar amounts. Or they are for new entities.

The highest increase in the state by dollar amount is $1,211 on a median-priced home in Cedar Highlands. It is a brand-new town of about 120 residents, nestled in forests at about 8,000 feet in the mountains southeast of Cedar City.

The Park City School District plans a 9.6 percent increase, but that has one of the higher costs in the state: $147.84 on a median-priced home there. It would help raise the starting salary of teachers there to $50,000 a year.

"We pay by far more than anyone else in the state,” says district spokeswoman Melinda Colton. “That has been invaluable as we’ve been hiring” and competing with other school districts in the Salt Lake Valley that have been boosting their teacher pay.

She notes that the district doesn’t get to keep 34 percent of the increased revenues. State law requires putting it in funds for equalization among school districts statewide — to help smaller, poorer districts keep up with richer ones.

West Haven, in Weber County, had never imposed a property tax in its 27-year history, says Mayor Sharon Bolos. But she says it found it could no longer afford to do that. So it is creating a new tax that will cost $154 on a median-priced home.

Schedules of individual Truth in Taxation hearings are included in property tax valuation notices sent to taxpayers this month, in required newspaper ads and on the websites of most agencies proposing the increases.