The Wasatch Front’s largest property tax delinquents are an interesting bunch.
Powder Mountain ski resort argues it deserves a big property tax break available to ranchers and farmers because it allows livestock to graze there in the off-season — and wants to resolve that before paying its overdue bill. Union Pacific says it is being railroaded by tax collectors.
A hotel at the center of past Utah Transit Authority scandals managed not to pay its tax on time. The American Express buildings that were just sold to the state have a huge unpaid tax bill. And the biggest property tax delinquent of all is a hospital group that just moved into the state.
Taxes were due this year on Dec. 2. A few weeks later, counties by law started posting a sort of warning and shame list of those who missed the deadline. The Salt Lake Tribune downloads and analyzes the lists from Salt Lake, Utah, Davis and Weber counties — and unveils which delinquents owe the most, and any celebrities who land on the list.
A few state legislators appeared on it this year. Also, while Utah House Speaker Brad Wilson paid his personal taxes on time, some owed by his development company were late. Ditto for former House Speaker Greg Hughes, who is expected to run for governor.
Late payments are assessed a penalty, and interest starts accruing. If the taxes are not paid within five years, the properties go to a tax sale where they may be auctioned off for the back taxes and penalties owed.
Following is a look at some of the 2019 tax delinquents.
The biggest delinquents
Steward Health Care, which is new to Utah but says it is the nation’s “largest private, tax-paying hospital operator,” ended up No. 1 on the tax delinquent list.
Three of its facilities were late on just over $1 million combined.
That included $474,578 on Davis Hospital and Medical Center in Layton; $480,607 on the Mountain Point Medical Center in Lehi; and $58,280 on the Davis Hospital Weber Campus in Roy.
Steward did not respond to multiple inquiries about why the taxes were late before this story was initially published. It did respond afterward on Jan. 6, saying that the taxes had been paid in full on Dec. 31, according to spokeswoman Jodi DeJong.
Steward operates several other hospitals and medical centers along the Wasatch Front for which taxes were paid on time, including the Jordan Valley Medical Center in West Jordan (and its West Valley City campus, formerly called Pioneer Valley Hospital) and the Salt Lake Regional Medical Center in the capital city.
Most of those facilities also were on delinquency lists a year earlier in 2018, but at that time they were owned by Medical Properties Trust of Alabama. They combined to be No. 2 on last year’s list, but records show that taxes due then were paid late.
Ski resort or ranch?
Summit Mountain Hospitality Group, or SMHG, the parent company of Powder Mountain ski resort, is delinquent on $880,000 in tax payments, according to Weber County records. That made it No. 3 on the overall list.
But the resort says the county is charging it too much because of a dispute about whether it deserves big “greenbelt” discounts — such as a 95% reduction in taxable value — usually available only to farms and ranches to encourage them to remain in agricultural use.
“As an engaged member of the local community, we allow two local ranchers to graze the majority of our property during the summer months,” Powder Mountain CFO Shaun Mulreed wrote in an email.
“As such, some of our land holdings have been accurately classified as greenbelt for tax purposes. A number of those parcels were removed from greenbelt for the 2019 tax year due to what we believe are clerical errors, and we are working on correcting those mistakes prior to paying our 2019 property tax bill,” he said.
As a result, Mulreed added that Powder Mountain feels Weber County records “show tax liabilities that significantly exceed the amount owed” by the resort.
Weber County Assessor John Ulibarri confirmed that some Powder Mountain areas were awarded greenbelt discounts recently, but he said the ski resort failed to send back required paperwork that is needed to continue that status — so it was removed. He said earlier this week that the resort has not filed any formal appeals.
How deep the discounts are from greenbelt classification varies, Ulibarri said. “But typically, in Weber County it’s right around a 95% decrease in taxable value…. That’s by design, though. The entire intent of greenbelt is to keep farmers farming.”
Ulibarri said the dispute is not really over whether Powder Mountain qualifies for a greenbelt discount — the assessor’s office previously figured that it does on some parcels — but is over whether the resort has filed all the required paperwork.
Union Pacific railroaded?
The Union Pacific Railroad is No. 2 on the delinquent list — after being No. 1 last year — amid an ongoing fight over its assessments. It owes $976,335 in Utah County, according to its delinquency list.
In 2018, the railroad contended that the Utah State Tax Commission placed values on its properties statewide that are 75% too high. It filed a federal lawsuit challenging those valuations, and a judge allowed it to hold disputed taxes in escrow until the lawsuit is resolved.
“Union Pacific believes its property tax assessments for both the 2018 and 2019 tax years exceed the fair market value of our properties,” Union Pacific spokesman Tim McMahan said in an email.
“Certain counties incorrectly included taxes from prior years on the current 2019 bills,” McMahan wrote. “We are working through the legal process to resolve these matters.”
Hotel with a history
The owners of the new Embassy Suites Hotel at the South Jordan Station of the Utah Transit Authority’s FrontRunner rail line is No. 4 on the list, delinquent for $425,544 in taxes.
An interesting footnote is that hotel’s role in past UTA scandals.
The hotel was built as part of a “transit-oriented development” (TOD) between UTA and a development company called Thackeray Garn, one of the principals of which is former Utah House Majority Leader Kevin Garn.
After a 2014 legislative audit criticized sweetheart deals with developers — and helped lead to a federal investigation into that agency — UTA canceled six of seven TODs with Thackeray Garn — all except for the South Jordan hotel, which the agency said had proceeded too far to cancel.
Among concerns with that hotel, according to documents UTA released in 2017, was that two former UTA board members were invited by the company to invest in that hotel after voting to approve it.
Both former board members, Sheldon Killpack (former Utah Senate Majority Leader) and Chris Bleak (former Utah House chief of staff), said they did not end up investing in the hotel.
SoJo Hotel Partners, which has the same principals as Thackeray Garn, did not respond to inquiries about why its taxes were not paid on time.
New state building with old tax bill
Earlier this year, the state government made headlines for spending $30 million to buy buildings that for decades housed American Express in Taylorsville — with plans to spend another $26 million to turn it into a needed state office building. It was seen as a sweet deal.
But the state’s Division of Facilities and Construction Management appeared on Salt Lake County’s tax delinquency list as owing $406,000 in property taxes on the buildings, landing at No. 8 among all Wasatch Front tax delinquents.
Division Director Jim Russell said while the state has bought the buildings, the deal required the former owner to pay the tax — and said he will pursue why it has not been paid. It was owned by American Capital Heathcare Trust II.
Russell said American Express — which leased the current location for more than 35 years — will be in the buildings until the end of January before moving to a smaller site in Sandy.
The buildings with 400,000 square feet on 31 acres are intended to be the new home of the Department of Agriculture and Food and the Department of Technology Services.
The new owner of the Seven Peaks water park in Provo, a company listed on records as Looppee Lopez, is No. 9 on the list, owing $365,864, according to Utah County records.
Last year, the previous owner, ParkProvo, was No. 6 on the list, and had filed for bankruptcy. The park did not open in 2018, but did in 2019 with a operator and new renovations.
Other companies atop the delinquency list include at No. 10 the SilencerCo manufacturer of gun silencers. Salt Lake County says the company missed the deadline on $218,517 in property taxes on its West Valley City plant.
The company, whose founders were big Republican campaign donors — to the tune of more than $60,000 in the 2016 campaign — and hosted a visit and filmed an endorsement video featuring Donald Trump Jr., had big hopes of federal legislation to deregulate the sale of the firearms sound suppressors.
While pushed by Republican lawmakers, including Utah Sen. Mike Lee, such legislation has foundered in Congress. And SilencerCo, which had hoped to expand its customer base by cutting their wait times and fees, in early 2017 laid off an estimated 40% of its workforce.
The DataBank data center in Bluffdale — a high-tech back-up service company — was late on $412,820 in taxes.
SCP Fox Hollow was No. 5 on the list, late for $421,751 in tax on undeveloped tracts in Saratoga Springs. Developers often are high on the list because some traditionally use unpaid tax as sort of an easy-to-obtain loan — avoiding the need for other loans to cover taxes on property that is not yet generating revenue.
Weber County Treasurer John Bond said treasurers have noticed less of that lately among developers while Utah’s economy has been booming, and homebuilding and home prices have prospered.
Some other businesses with familiar names on the delinquent list this year included Dannon for its West Jordan yogurt factory, $272,204; Fort Union Shopping Center, $179,422; the Ascent Academy charter school in West Valley City, $134,053; Soccer City, $111,063; and the Syracuse Family Fun Center, $97,569.
Every year, a few politicians land on the delinquency list.
This year two state legislators were late on property taxes on their homes. Rep. Stewart Barlow, R-Fruit Heights, was late on $13,604. “We just missed the deadline, but have paid it now,” he said. “And we paid a penalty for that.”
Rep. Susan Duckworth, D-Magna, was late on $1,928 on her home. She did not return phone calls seeking an explanation why she was late.
Two other politicians were not late on their personal taxes but were late on some taxes owed by their businesses.
Utah House Speaker Brad Wilson is co-owner of Destination Homes, and it was late on $3,328 in taxes on three parcels in Salt Lake and Davis Counties.
“We pay tax on hundreds of properties every year. I saw a stack of forms for them on our accountant’s desk,” Wilson said. “A couple must have slipped through the cracks,” and he promised to handle them.
Companies where former House Speaker Hughes is a partner similarly owed $11,677 on an apartment building and another nearby property in downtown Salt Lake City. Hughes said a business partner handles the books on those properties. That partner, Gary Nordhoff, said the deadline was missed but the amounts will be paid soon.