PROVO — Provo residents may see a 2 percent property tax hike this year as a piece of a multiyear plan for road maintenance.
The increase would contribute $78,000 to the city’s $3.5 million budget for a sustainable road maintenance program and would require each household to pay $2 more per year.
Provo Mayor John Curtis said the increase is a result of Provo’s move away from using bonds as a way to fund road maintenance.
“(Road bonding) is not a very good tool because you take out a bond for 10 years, spend the proceeds in the first few years because by law you actually have to, then you go the last seven years of that bond period with no road funding, with roads getting very little attention,” Curtis said. “So, we’ve made a commitment not to re-bond, and we’re doing several things like this very small property tax to change the road funding picture in our city.”
Royce Van Tassell, vice president of the Utah Taxpayers Association, said he and other association members have been working with Provo leaders to “find a meaningful solution” to fund road maintenance, which is a problem many cities face.
“I don’t think that their proposed tax hike solves that problem because any future council could say, ‘You know what, let's take this money that we raised taxes for last year and let's spend it on something else and just let the roads go,’” Van Tassell said. “We talked a lot about that at the Taxpayers Association conference and I think there are very important issues that need to be addressed.”
Wayne Parker, Provo's chief administrative officer, said the City Council will be studying a “host of possibilities” over the next few weeks before the tax increase proposal is adopted.
The council is considering other options like transportation utility fees, expenditure cuts or a decision to not fund the $78,000 into roads at all, said Matt Taylor, the council's executive director.
Provo administrators’ main goal, however, is to create a long-term road maintenance plan by not creating deficits elsewhere, Parker said.
“Our whole objective is to come up with a sustainable approach to road funding to not use debt, to pay as you go, and to have a source,” he said. “But if you solve the road problem by creating another problem somewhere else, you haven’t created sustainability, you’ve just put a Band-Aid on it.”
The council will decide during a public hearing Tuesday to either adopt a city budget without a property tax increase or to set a truth-in-taxation hearing date in mid-August if the tax increase proposal is accepted.