UTA hopes to recoup loss
There are no comments for this page [ Add Comment ]Wednesday, July 11, 2007
By Trent Toone
Standard-Examiner staff
Sales tax increase could make up $17M from food sales tax reduction
OGDEN -- The Utah Transit Authority is seeking a sales tax increase along the Wasatch Front to offset a sales tax reduction implemented by the state Legislature earlier this year.
UTA says it needs the increase to make up for a projected $17 million loss in revenue from the sales tax reduction on food approved by legislators. UTA officials are asking county and city officials throughout the region to impose an increase of 0.05 percent.
If approved, the tax will be added to a quarter-cent of sales tax already dedicated to transportation, which UTA projects should nearly recover the lost $17 million.
Without the increase, city and county officials face falling behind financially on long-term transportation projects, UTA general counsel Bruce Jones told the Weber County Commission on Tuesday.
The proposed increase could be implemented by county commissions and city councils and is not subject to a public referendum.
Although no governments have yet approved an interlocal agreement on the tax increase, Jones said he has already met with officials in Utah and Salt Lake counties and had preliminary discussions with Davis County officials about the increase.
Meetings with officials in Brigham City and Tooele are expected before the end of the year. UTA provides transportation in those two cities, as well as in Weber, Davis, Salt Lake and Utah counties.
Weber Commission Chairman Kenneth Bischoff believes another tax increase by the commission without public consent will not sit well with residents.
"If we did away with sales tax, only to come back and make everyone whole, what did we really accomplish?" he said. "The Legislature should stand up and make UTA whole."
Of the 6.6 percent current sales tax in Weber County, two quarter-cent taxes, or 0.5 percent, are dedicated to transportation. A third quarter-cent sales tax increase for transportation is slated to go before voters in November.
The tax increase is projected to bring in $400,000 annually, with the entire sum toward transportation projects.
The tax would take effect Jan. 1 and run until 2057, although Jones predicted it would continue beyond that to accommodate long-term projects such as commuter rail.
The proposed increase is not as controversial as one might think, he said. When combining the Legislature's food tax decrease with the 0.05 percent increase, there is still an overall decrease.
"It's not intended as an overall tax increase, but an overall tax decrease," Jones said.
Commissioner Craig Dearden said the Legislature's action leaves county governments like Weber in a tough spot.
"The legislature looks great because they made the tax cuts, but we look bad because we have to raise them to make up for the loss. If we don't raise them, we look bad because we didn't want transit," Dearden said.
"We lose either way. I am not happy with this situation at all."
Commissioner Jan Zogmaister expressed similar concerns and said UTA needs to ensure the funding from an increase would come directly back to benefit Weber County.
A final version of the document could be back for action at a July 19 commission meeting.
Sen. Jon Greiner, R-Ogden, said giving tax relief to all Utah residents was a priority when the Legislature decreased the sales tax on food. Resulting anomalies were expected, he said.
"We understand their (Weber County) concerns. We realized a number of things would suffer as a result of the food tax, but we gave cities and counties the chance to recoup that if they wanted to," he said.
Royce Van Tassell, vice president of the Utah Taxpayers Association, said increasing the sales tax won't help transportation.
"Raising sales tax doesn't help more cars get to where they need to go."
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