Another year, another letter from the city trying to gaslight residents that overcharging them for power to avoid truth in taxation and to hide the true cost of city government is a “dividend”. I never realized that being intentionally overcharged on a product (particularly a basic necessity) makes me an “investor-owner”. I’m doubtful even the slickest used car dealer would be able to keep a straight face if they said that.
The city does mention that the overcharges are “used to offset what otherwise would be a significant increase in property tax rates.” If you read between the lines, that clearly means they’re manipulating power rates to hide the actual tax burden. It also lets them raise power rates rather than transparently notifying residents of tax increases and holding truth-in-taxation hearings. Keep this in mind when the city glibly touts that we’re in one of the lowest taxed cities of its size in Utah (they, of course, omit the power transfer in their ‘analysis’). In years past, I and others have run our own tax rate comparison that included the power fund transfer. Yes, it does significantly change the city’s position when compared to other cities; Bountiful consistently ended up average or slightly above average for property tax burden in similar sized cities.
I’m done taking the time for that analysis, I’m not going to do the city’s job for them. If they want to argue that things have changed, they’re more than welcome to run the analysis and send it on. It is also noteworthy that they have quit saying that residents pay less for power than other areas. Again, last time I ran the numbers, residents paid similar or higher rates than Rocky Mountain Power customers. I’m also done taking time for that analysis.
Meanwhile, the power transfer continues to grow after the city raised the customer charge 3% last year. The city collected an additional $218K in 2023 for a total of $2.8 million in excess power revenues that went into the general fund via the power rate overcharge.
For 2024, the city is raising power rates 15% which will result in the city overcharging to the tune of a bit over $3.0 million which will be transferred into the general fund – $200,000 more than the $2.8 million in 2023.
So why does the city claim it needs to raise fees and rates if they’re transferring a good part of the additional money to the general fund? Why wasn’t the excess used to help cover the power costs rather than raising residents’ rates? Could it be so city politicians can avoid divulging the true tax burden and be able to raise additional revenue (up $218K to $2.8M in 2023 and a projected $3.0M in 2024) without truth-in-taxation? What pet projects will those funds be used to cover or subsidize rather than being properly evaluated for effectiveness and as an appropriate role of government? And what inefficiencies or cost overruns in current government operations will these funds be used to cover up?
As for residents, enjoy your “dividend” you “investor-owners”. Don’t spend it all in one place.
Addendum: This year, there is no mention of the amount the city spent to bail out the recycling fund. This is likely because the city took over the entire floundering curbside recycling program. For the past several years, the city was taking $75,000 – $95,000 from the landfill (a pretty critical service) to bail out recycling.
Utah Rattler 