Utah cities stay afloat financially

The Utah Taxpayers Association believes that carefully deliberated municipal debt can be necessary, but the group has spoken loudly against placing financial obligation on residents when corporations receive the benefit.

Debt for redevelopment projects that don't create new jobs is unsound and inappropriate, said Royce Van Tassell, vice president of the association. The group also takes issue with municipal bonding for projects like recreation centers and golf courses, saying those things should be left to the private sector.

What cities are buying

Regardless, the vast majority of Utah cities and towns have taken on debt for such projects, according to the Deseret News analysis. Salt Lake County has gone a step beyond, accruing debt for the arts and Hogle Zoo.

In Park City, Summit County and Draper, voters have chosen to increase their property taxes to pay for bonds that funded open space purchases.

"We try to balance funding our capital projects with both cash and debt, and we think given the fact that the voters approved this that they are agreeing to pay it," said Park City manager Tom Bakaly.

But many bonding projects are the result of needs to provide services to local residents.

Most cities that have bonded debt have pledged revenue to build infrastructure for a water system, sewer system or other utility. Many have built new city halls or other buildings.

But recent economic uncertainty has made many Utahns reluctant to support bonding for certain projects. American Fork voters, for example, soundly rejected this month five new bonds totaling $18.6 million to expand and improve various roads, a park, trails and a cemetery. Voters also took Election Day stances against the sale of $940,000 in general obligation bonds for fire equipment in Box Elder County and the sale of $10 million in bonds for open space in Cache County.

The Salt Lake City Council recently voted to move forward with plans to build a new fleet-maintenance facility, using up to $32 million in sales-tax revenue bonds. Councilman JT Martin has opposed the action, expressing concern about the financial commitment the city would be making in an "unprecedented economic situation."

"It's something that's needed," Martin said of the facility, "but the timing is really bad. I would prefer that we wait for a while to see what the bond market is doing."

Voters in Springville, however, just approved issuing $9.8 million in bonds over the next 21 years to cover the costs of building a new library. And Salt Lake County voters agreed to $52.6 million in bonds for improvements to Hogle Zoo and Tracy Aviary.

Financial sense?