State lawmakers panicked unnecessarily and passed a tax hike that will hurt small businesses and unpleasantly surprise vehicle owners, a representative of an association of counties said Thursday, assessing the impact of the legislative session that closed Wednesday.
Brent Gardner, a lobbyist with the Utah Association of Counties, told the Wasatch Front Regional Council that legislators don't understand the scope of the Utah Supreme Court ruling granting tax relief to the AMAX Corp.It was that ruling that prompted lawmakers to increase the personal property tax rate by 15 percent, attempting to head off what they see as a statewide decline in property tax revenue.
But Gardner and the association maintain the court ruling applied only to AMAX. There are special circumstances involved in the case that make it case-specific, Gardner said.
The association tried to convince legislators not to panic and raise taxes, Gardner said, but to no avail.
The increase in personal property taxes will first affect small businesses, which pay them on their office equipment and other supplies, and then will hit vehicle owners, he said.
"Car owners aren't going to realize the impact until they get their registration renewal next year," Gardner said. "In some cases, the increase could run $80 to $90."
In addition to being unnecessary, in Gardner's opinion, the action will eventually result in blame for the increase being placed unfairly on cities and counties, he said, instead of where it belongs: on the state.
"We took the position early on that the Legislature was overreacting to the court case," Gardner said. "We maintain that it is only one court ruling and there are special circumstances that make the case different. "We tried to get them to hold off, to wait for another court case at least, but the legislators reacted by raising the personal property tax rate 15 percent. And the counties and the cities will take the heat, not the legislators," Gardner said.
The lobbyist described the just-ended session of the Legislature as "one of the more difficult sessions we've had, and I'm not exactly sure why."
"We found it very difficult to capture any sympathy in this session for solving the problems of local government," he said. "We've jokingly said in the past that one of the qualifications for serving in the Legislature should be a term in local government. That was nowhere as evident as in this last session."
The state's budget problems, the sheer number of issues facing the Legislature and the number of inexperienced legislators serving their first terms may all be factors, he said. Freshmen legislators tend to see lobbyists as the enemy, Gardner said, but they mellow out with experience.
The association of counties' priority for the session was a bill to smooth out some problems in the assessing and collecting of property taxes, Gardner said. It passed the Senate easily, but when it came to the House Revenue and Taxation Committee, it stalled.
"They saw it as just another attempt by local government to put their hand out (for tax revenue)," he said, noting that even testimony from local elected officials seemed not to move the committee members.
But some good things were accomplished, Gardner said, singling out the Salt Palace renovation package and a bill giving cities and counties the option of imposing a 1 percent sales tax on hotel and restaurant services to be used for tourism and related activities.
"Success was mixed. We got a few and we lost a few," he said.