Utah County puts off tax hike — for now

PROVO — Utah Valley residents have dodged a county tax increase for the seventh consecutive year, but that streak could be snapped as soon as 2005, county commissioners warned Tuesday as they approved a balanced budget for 2004.

"We are in the fourth year of reductions in sales tax revenue and property tax revenue," Commissioner Gary Herbert said. "If the economy does not improve and does not improve our revenue stream, we will either have to cut services or raise taxes."

Herbert said it would be difficult to cut services in the face of rapid population growth.

"Eventually," he said, "there is a tax increase in your future."

The three-man commission chose to delay the rare tax increase in hopes the economy would improve and allow further postponements of a hike. The commissioners made up for a lack of revenue and balanced the '04 budget by using more than $3 million they were setting aside to expand the county jail in Spanish Fork.

"We're robbing money that would go to a future expansion project at the jail," Herbert said, "but we're doing it to see if revenues will increase next year."

The commission has a record of frugality. It hasn't raised taxes since 1997, when the jail was completed, Herbert said. The commissioners' decision Tuesday to avoid a hike for another year drew praise from Howard Stephenson, a state senator who represents northern Utah County and doubles as president of the Utah Taxpayers Association.

"Utah County has historically been one of the best-managed counties in the nation, as evidenced by its low expenditures per citizen and low taxes," he said. "We believe without hesitation it is the best-managed major county in the state of Utah."

Stephenson said the association's analysis is based on figures from the U.S. Department of Commerce.

The commissioners openly admitted the use of money from the capital fund earmarked for the jail is a departure from past practice that could make it more difficult to avoid a tax hike.

"We are deviating from those fiscal principles we've used for years," Commissioner Jerry Grover said. "This is a philosophical shift."

Stephenson agreed the unusual tack could lead to a tax increase.