Salt Lake County could lose millions in tax revenue under a bill endorsed Wednesday by a Senate committee to change the distribution of the county's Tourism, Recreation, Cultural and Convention tax.
The measure could be a benefit to cities such as Sandy, however, which is seeking to build a Broadway-style theater within its boundaries.
Under SB218, the 1 percent restaurant tax that feeds into county TRCC funds across the state would be replaced with a .07 percent local option sales tax. All counties except Salt Lake would be able to use that money to fund recreation centers, tourism and cultural sites.
In Salt Lake County, the bill stipulates that half its $16 million cut of TRCC money be distributed to cities within the county. Business groups such as the Salt Lake Chamber and Downtown Alliance said they worried the tax shift would be unfair to the county.
Brent Gardner with the Utah Association of Counties said he belied that cities already had sufficient local option sales tax sources to fund tourism, recreation and other facilities.
"Is it really to help cities or punish counties?" he asked. "It would certainly punish Salt Lake County where they would lose half their revenue."
Sponsoring Sen. Wayne Niederhauser, R-Sandy, said his bill was designed to hurt the county, but rather bring fairness to the restaurants paying into the TRCC fund.
"These specific industries are bearing the burden of that tax," he said.
Members of the Senate Revenue and Taxation committee voted down a motion to hold the bill in committee so Niederhauser could work on a more palatable proposal to the county and business leaders. Instead, they voted it out of committee with the idea that Niederhauser work on it before it is debated on the Senate floor.
"Let the bill pass, let the dialogue continue," said Sen. Curt Bramble, R-Provo, who made the motion to approve the bill.
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