If you attended a school board, city council or county commission Truth in Taxation hearing anywhere in Utah this past year, you probably felt it: frustration. Lots of it. Residents packed meeting rooms to speak out against proposed property tax increases, while elected officials looked equally exasperated, explaining they’d been working on the budget for months without hearing much public input — until now.
Utah’s Truth in Taxation law passed 40 years ago and was a first in the nation. It has been held up over the decades as a model tax policy. The policy has been effective in moving Utah from the middle of the pack nationally on property tax collections per capita to now 46th lowest, according to the Tax Foundation. This has inspired other states to adopt our process.
But even good policies need updating. Last year, that was clear.
It’s time to bring the public to the conversation earlier and in a more meaningful way. It’s also time to ensure our budgetary processes are responsive to that feedback.
Under the current system, local governments begin operating on their proposed budgets, including any planned tax increases, on July 1. But Truth in Taxation hearings can’t happen until mid-August. By the time the public gets its official chance to comment, the new budget has been in place for over a month and a half. Employees may have received raises. Projects may be underway. Contracts signed. Software purchased. All based on the budget that includes a tax increase.
At that point, asking whether the tax increase should happen feels a bit like asking whether the train should leave the station after it’s already moving.
When residents show up to hearings feeling like the decision has already been made, they are right — it often has.
But we’ve also placed elected officials in an uncomfortable position; they are following the existing law. Budgeting is complex and takes months of effort. Local leaders must plan responsibly, accounting for increased costs and providing essential services.
It’s time for a better way forward — one that preserves the strengths of Truth in Taxation while making public input more meaningful and giving elected officials the opportunity to be more responsive.
This year we are working on legislation that does two things: It requires the public be brought into the conversation earlier and establishes a more fiscally responsible budget process.
Local governments start their work on their budgets early in the year. If they are considering a tax increase, notice will be provided to the public at least a month prior to the budget being finalized.
The bill will also require local governments to operate on a baseline budget starting on July 1 that reflects existing revenue only, with no tax increase assumed. Then, if a tax increase is being considered, a proposed budget will be made available to the public as an option, not a foregone conclusion. This proposed budget with the tax increase could only be adopted AFTER the Truth in Taxation hearing.
This change would create two important benefits.
First, it would allow the public to clearly see the difference between a budget with no tax increase and one with a proposed increase. Taxpayers could understand where government is growing, how inflation is affecting services and what exactly additional revenue would fund. This increased transparency makes the budget more accessible to the public and leads to better conversations between elected officials and their constituents.
Second, it would restore credibility to the Truth in Taxation hearing itself. Public comment would matter because the decision truly hasn’t been made yet. Local leaders would still retain the needed authority to raise taxes when necessary but would also have an easier ability to respond to the feedback they heard.
Truth in Taxation has been a benefit to everyday Utahns. It’s time to strengthen it in a way that improves transparency, builds trust and ensures it can continue to serve Utah well for the next 40 years.