A vote in favor of allowing the county to issue general obligation bonds to help fund the Utah Valley Special Events Center will not mean an increase in property taxes, Utah County commissioners said Monday.
During the work session of Monday's commission meeting, commissioners said it is their intention to repay the bonds with revenue received from imposing the 1 percent restaurant tax approved recently by the Legislature.Wednesday, commissioners are expected to make their intentions official in the form of a resolution. Commissioners say they want voters to know before going to the polls that property taxes will not be used to repay the bonds.
"Before the election comes we think it's important for the public to know what our leanings are," Commissioner Gary Herbert said.
County officials and Utah Valley Community College officials are proposing a joint effort to build the $18 million special events center on UVCC's campus. The center would be an expansion of the college's plan to build a new physical education building.
On April 9, the county will hold a special election to ask voters to approve issuing about $7.7 million in general obligation bonds to help fund the center.
Counties can impose the 1 percent tax on prepared foods, but must use the proceeds to promote tourism, recreation, conventions and cultural activities.
By imposing the tax, it is estimated that the county will receive between $700,000 and $800,000 the first year. That amount should increase every year.
Officials say the annual bond payment will be about $700,000.
Most attending Monday's meeting spoke in favor of imposing the tax for the purpose of repaying the bonds.
Michael Mack, Utah County Travel Council director, said the special events center would enhance the county's tourism industry. Repaying the bonds with proceeds from the restaurant tax would fit within the Legislature's intended use of the tax.
"There are a lot of things we could spend that money on, but none more appropriate than the special events center," Mack said. "It would be a good use of those funds."
Walter Sive, representing the Sundance Ski Resort, said he has seen other parts of the country benefit from using similar taxes to promote tourism. In every case, he said, the value received from the tax offsets the burden.
"I've seen that this tax is really not a tax, but an investment," Sive said.
However, Victor Borcherds, owner of Seven Peaks Resort, said the county should spend the money equally on different projects throughout the county. He said using all the tax to repay the bond would be wrong.
"I don't think it would be equitable and I don't think it would be fair," Borcherds said. "I think that there are others things we need to do in the county."
Borcherds supports the concept of a new physical education building at UVCC, but said the county is premature in promoting the special events center. He said more research needs to be done before committing the public's money to the project.
"To say that we need a convention center at UVCC is in my estimation ludicrous," he said.
Commissioner Malcom Beck said the county will research the project thoroughly before issuing the bonds.
"We will not issue those bonds until we've seen the schematic drawings and the details," Beck said.
Even though counties can start collecting the tax as soon as July 1, commissioners said the county will likely wait until the bonds are issued before imposing the tax.
"It might be two years and it might be sooner," Beck said.
However, Beck said the county may impose the tax earlier if someone approaches the county with a legitimate need for the money.