BRIGHAM CITY -- It's official: Residents here will pay a higher city tax rate for their utilities.
City council members recently approved an $11.9 million budget that more than doubles the municipal energy tax that residents pay on gas and electric bills.
The new tax rate takes effect in January, increasing the rate from 2.25 percent to 5 percent. Mayor Dennis Fife said in an earlier public hearing that the delay until 2013 may help the city find other ways to make up for decreased sales tax and other types of revenue.
The budget also includes a 2 percent merit pay increase for employees.
Fife said the administration proposed the energy tax increase because the city's rate is among the lowest in the state. Utah law caps the energy tax cities can charge at 6 percent. The city, which owns the electric utility, had also absorbed electric rate hikes from major suppliers such as Rocky Mountain Power without passing those increases on to residents, said Fife.
"For me, it's about $5 a month total," Fife said.
Still, that increase was enough to prompt council members Ruth Jensen and Brian Rex to vote against the budget.
Jensen said the energy tax was simply an easy target. Raising the energy tax does not require the more stringent reviews and public input required by a property tax increase, she said.
"I look at it as $5 per month for the next 12 months. How many loaves of bread is that? How many gallons of gas?" she said. "I'm on a tight budget, and I know how many gallons of milk I can get for that. To me, it's hard on people."
Rex's concern, he said, was that the city as the electric utility operator should not be trying to protect residents from fluctuations in energy rates. Increases in electricity costs are "just a reality," he said. "We don't try to shield people from gasoline price increases."
He said, with the economic downturn, "I just don't think this is the wisest thing to do at this time."