New homeowners and established homeowners alike may continue to bear the brunt of residential growth in Lehi, if city leaders approve a 5-percent property-tax hike.
Last week the City Council agreed to study a proposal to raise the certified property-tax rate from .002173 to .002275. That means the owner of a $75,000 home would pay $114.32 this year, up from $109.19 in 1992. (The amount of the tax is determined by multiplying the home value by 67 percent, times the tax rate).The city just retired its debt obligation on the municipal pool, meaning that the rate should normally fall to .001804 (or $90.65 on a $75,000 home). But for the city to provide a balanced fiscal 1994 budget, Lehi officials would have had to raise either utility rates or the property-tax rate. They opted for the latter.
Increasing the property tax by approximately $5 on each home will help the city provide essential services to residents, despite the fact that some utility departments (including electrical) have become less profitable for the city, according to city recorder/budget director Gary Lewis.
In fact, Lewis said maintaining a budget balance and keeping utility and tax rates low has become a yearly struggle for the financially strapped northern Utah County city, which has seen a large influx of residential growth over the past two years.
Last year, just two months from the end of fiscal 1992, Lehi officials cut more than $70,000 from their departmental budgets, stripping them down to the bare essentials. They also raised three city-based utility rates - electrical, sewer usage and monthly garbage collection - by nearly 8 percent apiece to balance the books.
Department heads recently came to the council with $390,000 in itemized fund requests. The property-tax moneys should help city leaders satisfy a portion of those requests.
The increase will be the second fee hike made on new homeowners this year. In March, the City Council voted to impose $1,000 in new utility impact fees - $250 for culinary water, $300 for pressurized irrigation, $100 for sewer, $250 for roads and $100 for parks and recreation - on each new home building permit.
Council members imposed the impact fees to enable the city to make utility improvements, which were made necessary by residential growth in Lehi. A portion of those fees collected are refunded to developers and builders, who also pay increased utility charges for each new development or home - they are required to add 8-inch sewer lines, 4-inch culinary water lines and 8-inch pressurized irrigation lines.
Because of the proposed tax increase, the city must hold a truth-in-taxation hearing. That hearing will take place during the council's Aug. 10 meeting, which starts at 7 p.m. in the council chambers, 153 N. 100 East.