Kaysville City decided it wanted to its increase budget. In doing so they preferred to avoid truth-in-taxation laws and artificially raise electricity rates through the city-owned power company. This strategy has been perfected by Bountiful City which has, for decades, consistently transferred millions into its general fund while deceptively claiming lower property taxation rates. Upset Kaysville residents demanded answers resulting in the city specifically employing Bountiful’s sophistry on ‘lower tax rates’ and ‘making churches pay’:
…The budget proposal included a plan to raise electricity rates since the city has its own power system, rather than raising tax rates.
“It’s inappropriate to transfer money for the general fund,” said Floyd Morgan. “You’re just circumventing asking for a tax increase.”
“…[Jana Whitaker] I’m not in support of raising our electrical rates in order to fund things that are not for electrical needs.”
[City Manager John Thacker] used Bountiful as an example saying the city transfers $2 million annually, a move that allows them to keep their tax rates lower.
Renters, schools and churches do not pay property taxes, yet benefit from city services including police, said city council member Mark Johnson.
[Transcribed from the Davis County Clipper June 21, 2012 article “Divided vote on disputed budget” – not available on the web]
The tax rate thing is pure spin. The fact is the city knows raising a power rate will attract less attention and the city council also knows a tax or rate increase results are identical: less money in the family budget and more money in city coffers. They are playing a shell game to cloak the true tax rate (I debunked Bountiful’s same claims here).
Next is the awful justification taken from Bountiful City’s playbook (see here and here): we need to make those dastardly churches and charities pay for services. All those rotten LDS, Catholic, and Protestant churches and charities apparently are leehes and certainly don’t carry their weight in community services. C’mon who believes that?
As for renters not paying property tax – who do they think they are fooling? Do they honestly think a landlord is not going to pass property tax costs on to his/her renters?
It is also notable that municipal power companies are exempt from Public Service Commission (PSC) oversight. Utility rate manipulation appears to be the norm for cities with their own power companies. This type of abuse needs to end whether it be relinquishing such companies, placing rates changes under truth-in-taxation regulation, or, at very least, placing these power departments under PSC oversight.