In the latest city newsletter, Bountiful continues to claim that it has the lowest tax of a ‘major city’ in the State. The figure Bountiful uses, however, is misleading. It does not include the hidden tax the city sticks into residents’ power rates.
Each year, the city uses its power company to transfer about $2 million into city coffers. To my knowledge, most major cities, with a power company, (unless Lehi is a major city) do not use their own power company to as a method of covert taxation and many cities don’t have their own power company. Bountiful is trying to use an apples and oranges comparison of property taxes.
Bountiful’s newsletter also notes that it collected $1.96 million in property taxes. That means the power tax revenue ($2 million) is about equal to that collected in property taxes which significantly increases the actual tax rate on residents. I feel confident in saying that this would rapidly drop Bountiful’s rank in comparison to other major cities.
Interestingly, Bountiful has again increased power rates (up another 10% or about $84/year, on average). Which pushes the rate to about 8.896 cents/kWh. That is actually quite a bit higher than Rocky Mountain Power’s (RMP) residential rates (pdf) of 7.539 cents/kWh (Oct-April) and an average of about 8.149 cents/kWh (May-Sep – unless you use a lot of power). Additionally, RMP includes State and Federal taxes within those rates (as well as profits for shareholder and costs related to regulatory oversight) – I did not include the city customer tax in Bountiful’s rate (municipal power companies don’t pay State/Fed taxes). Municipal power companies are also not subject to oversight by the Public Service Commission. Accounting for the above would further widen the gap between the rates.
Of course, Bountiful can continue to crow about how it can use power rates to sock it to the evil churches, food banks, charities, and the like who don’t pay property taxes. The City also stated that the power rates allow them to charge renters who don’t have to pay property taxes. If you don’t think renters pay property taxes, I have a bridge for sale.
For what it’s worth, utility rates (including power) will increase, on average, about $132/year but I don’t think the city uses any other utilities to funnel money into its general fund.
Ending on the semi-positive: the Bountiful City Council did not force everyone to pay for recyclers’ (self-included) convenience. They approved a voluntary opt-in program. This, however, comes with a warning: the City may be involved with the program. If so, it can easily be mandated for all to pay. Vigilance will, yet again, be necessary.
WARNING: West Bountiful residents beware: W.B. mayor pushes for more recycling – he is considering a mandated recycling fee. This is the same Mayor that wants a redo on the RAP Tax. Both measures benefit special interests by having everyone else pay.
I would also encourage those who recycle paper to take it to some of the charity (such as the food bank) or school etc. recycling bins as it provides a bit of extra funding for them.
Related: Spinning City Power Rates