Doug Robinson: Orem tax feud is about city sneaking up on taxpayers

Published: Tuesday, Oct. 2 2012 12:06 a.m. MDT

Highland City officials approved a $900,000 property tax increase during a truth-in-taxation hearing Tuesday night in the city council building.

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It's "only" $4 a month.

That's what proponents of a tax increase in Orem are saying.

Or "only" $48 a year.

Who can't afford 48 bucks?

That's "only" about 13 cents a day.

What could possibly be wrong with that?

Actually, everything is wrong with that logic.

Maybe you saw the story about the feud that's brewing in Orem. Residents are upset the city wants to raise their property taxes to pay for a poorly named fiber optic network called UTOPIA.

The issue has sparked protests and what one resident called a certain amount of "incivility" and "negativity" in the city. People are upset. City Council meetings have been SRO. More than 5,000 Orem residents signed a petition to force a property-tax referendum in November 2013. That means the tax increase will be frozen until after the referendum. City officials are sweating bullets.

What's the big deal about a few cents a day, they wonder?

That sort of thinking is the problem — and the genius of the tax system.

Don't you see what's happening here? Taxes are raised incrementally, so nobody notices. A little this year, a little next year, a little the year after that. A little more for the county, a little more for the city, a little more for the state, a little more for the feds. Everybody's got their hands out asking for just a little, so nobody gets upset, and look where it's left us after decades of asking. In 2009, a median-income American family of two parents and three children paid 25.3 percent of its income to federal, state and local government. One-fourth of its income.

It began with a few cents. And a few more cents. And a few more cents.

Where does it end? Or does it? It's a long-running story without an ending.

"That's the argument people will make," says Royce Van Tassell of the Utah Taxpayers Association. "It's only $4 or $5 a month. They're like gas stations that charge $3.77 and 9/10s instead of $3.78. It looks smaller. It's easier to market to the public."

That's why local governments prefer to raise sales taxes instead of property taxes — they can nickel and dime citizens every time they shop and people don't even realize someone is reaching into their wallets. It's much subtler than property and income taxes.

"People don't recognize they're actually paying more in sales tax than in state and property taxes," says Van Tassell. "They don't even pay attention to it."

Government officials are like carpenters who think that everything can be fixed with a hammer; everything can be cured by gentle tax increases.

The Orem City Council has been adept at this and sly from the start in its attempt to pay for UTOPIA, according to Hans Andersen, the Orem rookie city councilman who has been unwilling to play ball with his peers. He says he was called to an early morning meeting in January, shortly after taking office, with Mayor Jim Evans and councilwoman Mary Street. To his surprise, they discussed raising property taxes — by about $9.90 a month — behind closed doors. Andersen says he later was told this was all confidential.

"I emailed them and told them this confidentiality thing doesn't apply to me," he says. "The only reason you've done this is because the city is embarrassed and doesn't want the public to know about it. Nothing in that meeting should be kept from the public."

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