The Provo City Council is nearing the end of its series of interactive budget meetings held throughout the summer in an effort to include the public in discussion of present and future funding.
The council has presented the proposed budget plan to Provo citizens, which, as stated in the agenda, calls for “$420,000 from one-time budget savings, $1 million from a 1 percent increase to the Utility Rate Transfer, and $78,000 from a 2 percent property tax increase.”
The 2 percent increase will only apply to the portion of property taxes that goes to the Provo City General Operations, resulting in a property tax increase of $2.41 a year.
“This is significantly lower than other cities in Utah,” Councilman Gary Garrett said. “While we’re increasing $2.41 a year, or $0.20 a month, Salt Lake has a 13.9 percent increase in their taxes and Highland a $180 a year increase.”
The reason for the tax increase is to “help Provo stay financially stable and independent of bonds and their interest rates,” Councilman Rick Healey said. “And we certainly don’t want to pay more in interest than what we bonded for.”
Councilwoman Laura Cabanilla personally believes that the $78,000 is too little and that if the city does not tax more this year, “we will grow accustomed to raising taxes each year.”
One major concern brought forth by the council and Provo homeowners was the maintenance of roads. Since Provo attracts many tourists and students from out of town and the renters that reside here do not pay property taxes, the damage done to the roads is paid from the pockets of the homeowners.
Homeowners at the meeting want more participation from visitors. One community member suggested that city employees take a salary cut.
Healey said that the roads should not be balanced on the backs of any one particular group — city employees, renters or homeowners. Rather, “it should be balanced on the back of the city as a whole.” He also said that “we want the right people working for the city” and cutting salaries would defer them.
In the end, Provo spends about $3.5 to $4 million a year on road maintenance, according to Garrett.
While it is a fairly new concept to Utah, Provo City is looking at employing the Transportation Utility Fee, following Highland in this step. The fee is based on the use of roads by businesses, residents, schools, nonprofits and government agencies and will be found in utility bills, affecting both property owners and renters.
“Currently, every time you pay a utility bill, 10 percent went to the city. For our proposed plan, we decided to raise it to 11 percent,” Garrett said.
Fifty-five percent of Provo currently does not pay property tax, as they are properties owned by churches and nonprofits. The largest of these entities are The Church of Jesus Christ of Latter-day Saints and Intermountain Healthcare. The city hopes to be able to receive funds from the exempt properties through the Transportation Utility Fee.
There will be one more meeting on August 3rd at the Provo City Center at 9 a.m. The Truth in Taxation Public Hearing will be held Aug. 6 at the same place at 6 p.m.