Park City Council says ‘no’ to property tax hike
Park City will finalize its budget for the next fiscal year in June. Last year’s budget was $63.5 million. The next budget could reach tens of millions of dollars depending on what the city council decides to do and spend.
The budget-determining process began Thursday with a presentation from city finance staff and questions from staff members to council about whether they wanted to raise any of the taxes that fund the budget.
Park City collects money from several sources, including property tax, sales tax, and various municipal fees.
Park City has no record of when it last raised property taxes, and councilors Max Doilney and Becca Gerber have suggested considering raising property taxes as a way to reduce the city’s reliance on revenue tourism sales tax.
Recent estimates place total annual property taxes at around $12 million in Park City proper, and annual sales taxes total just under $7 million.
The city has consistently set sales tax records since last March when the vaccines were rolled out. Gerber said the COVID-19 pandemic has highlighted the fact that sales tax isn’t always a stable source of revenue.
“We are going through a turbulent time and we saw our sales taxes drop a bit at the start of COVID when no one was coming out and coming here, and at the same time our property values continue to skyrocket,” said said Gerber. “We have a largely untapped resource here where I think 67% of our homes are second homes and they pay double the property tax that everyone else pays, so you can have a pretty nominal increase in tax land and that this brings substantial financial benefits to the city and potentially bring some stabilization.
The rest of the board wasn’t receptive to the idea. Councilwoman Tana Toly called the property tax hike “really scary” and said it would hurt low-income residents of the city. Councilor Jeremy Rubell shared these thoughts.
“Tough pass for me, to be honest,” he said. “I just think everything is booming, we’re printing tax money. To turn around and raise the property tax, we have affordability issues that only make it harder, to the point of Tana, but also at the higher end of that, affordability issues don’t just affect our social equity initiatives, they affect all levels. I think it has the opposite effect. I think the style living is expensive. I’m not going to argue that, it’s just harder on the residents, that’s really what it’s all about.
Gerber told KPCW that she doesn’t share the belief that the property tax increase isn’t fair and likened it to a flat sales tax rate that’s the same for everyone, no matter what. regardless of income level.
“I strongly disagree that it’s not fair to have a property tax increase because I think that’s one of the things that really sort of reflects where you are in that socio-economic hierarchy,” Gerber said. “When you raise sales tax, you pay the same amount whether you make $10 million a year or $40,000 a year on some of these items.
Toly, Rubell and Ryan Dickey have all agreed that a property tax hike isn’t the right way to go, so that option isn’t on the table this year.