Utah, Salt Lake counties weighing whether to breathe new life into failed transportation tax hike

SALT LAKE CITY — More than two years ago, voters in Utah’s two most populous counties rejected Proposition 1, the sales tax hike that would have brought in tens of millions for transportation projects.

But now, county leaders can bring it back from the dead.

That’s thanks to one of the many provisions included in the sweeping transportation bill passed by the Utah Legislature this year, which includes restructuring and renaming the Utah Transit Authority, among other changes.

The new law gives leaders in both Utah County and Salt Lake County the power to revive Proposition 1 — either by implementing the tax increase, which would raise taxes by roughly one penny for every $4 spent — through a vote from their legislative bodies, or by placing the proposed tax increase on another ballot.

Now faced with the decision to take one of those options — or do nothing — while also dealing with underfunded needs for roads and transit, leaders in both counties aren’t sure what they’ll do, but they plan to have the discussion over the next few weeks before the bill takes effect in May.

Because that’s when the clock starts ticking.

Included in the bill is an incentive for counties to act sooner rather than later, because if the tax is implemented before June 30, 2019, counties would be able to capture 100 percent of the revenue up until that date. Afterward, the funds will be split as if the change had been passed under Proposition 1: 40 percent to UTA, 40 percent to cities and 20 percent to counties. The sales tax option has an expiration date of June 2022.

On top of that, counties wouldn’t be able to implement a new 0.2 percent sales tax increase option provided in the 2018 transportation bill, which would raise at least $30 million in Salt Lake County for transit projects, until they’re collecting all four of the quarter-cent increases for transportation already allowed. That option has an expiration date, too: June 2023.

"That certainly adds a twist on all this," Salt Lake County Councilwoman Jenny Wilson, a Democrat, said of the incentives.

But like some of her Republican and Democratic colleagues, Wilson said she hasn’t officially made up her mind on what to do.

"It’s still early in the process," Wilson said, saying she wants more input from stakeholders but adding that a decision "sooner rather than later would be better."

County Council Chairwoman Aimee Winder Newton, a Republican, said she too hasn’t made a decision and hopes the council will have a "robust debate" on the issue in the coming weeks.

"I don’t know where my colleagues are on it," she said, but added she expects a "mix of opinions."

When Proposition 1 failed in Salt Lake County by a narrow margin — 51 percent to 49 percent — voters decided to pass on the state’s largest pot of sales tax dollars: nearly $58 million. When it failed in Utah County, 59 percent to 40 percent, voters passed on more than $18 million.

Meanwhile, voters in counties including Davis and Weber gave the tax increase a thumbs up, giving them a boost for roads and transit spending, while Utah and Salt Lake counties continued to lag behind.

Don’t look for the Utah Transit Authority’s new name to start showing up on buses or anywhere else until a new management team takes control of the agency sometime before Nov. 1, UTA Board Chairman Greg Bell said Friday.

The issue has put Utah County in a tough spot, said Utah County Commissioner Bill Lee. Because even though the bill provides a "big carrot" for the county, it also puts leaders at odds with an issue voters already shot down — and not by as close as a margin as Salt Lake County.

"If we are going to change our minds and say, ‘Well we’re going to do something different than what the people have already voted on,’ that gives me major pause," Lee said, adding that he was "disappointed" the bill kept the same percentage split with UTA.

"We still have these unresolved feelings" about UTA, Lee said.

Proposition 1’s failure in both counties was largely attributed to public distrust of UTA and its scandal-tainted past.

That’s why the 2018 transportation bill includes a restructuring to how UTA is managed, replacing its 16-member board of trustees with a three-member commission. It also includes a gradual rebranding of the agency, which UTA has said would cost upwards of $50 million. Lawmakers have found that price tag questionable.

It remains to be seen whether those changes have or will quell public concerns, Utah County Commission Chairman Nathan Ivie said, going as far as to say he would support a second shot at Proposition 1 "100 percent" if none of its money went to UTA.

"That’s my only reservation at this point," Ivie said. But, he added, "If there is public support for it and our long-term infrastructure needs, to me it would make sense for the commission to enact it," noting that it might be worth the extra money if Utah County implements it sooner rather than later.

Salt Lake County Councilman Jim Bradley, a Democrat, said given the changes to UTA, "It may be a good idea to revisit the issue." He said there’s "no question" the county needs the money.

"Clearly the need is there," he said. "How we go about a mechanism to fund it, that’s the big question."

But Salt Lake County Councilman Richard Snelgrove, a Republican, said he had "no appetite" for a tax increase enacted solely by the County Council, and he’d only be supportive of it going on another ballot if the language on the ballot specifically spells out what the costs would be on the average family.

Andrew Gruber, executive director of Wasatch Front Regional Council, said his organization is looking to the county governments to decide what is best for their taxpayers. He stressed, however, that there is a "great benefit to communities by investing in our region’s transportation systems."

"Our population is growing very fast, so making sure that we are making prudent investments in our road and transit and active transportation structure is very important to our region’s mobility, economy and air quality," he said. "The decision about implementing these revenue increases is a very important one, and I know that it will be given serious consideration by the counties."

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