Utah County and county commissioners have been included in a lawsuit that seeks to have declared unconstitutional a state statute that established a "complex mechanism" for statewide assessment of local property tax collection costs.
The lawsuit, which challenges the validity of Utah Code Annotated 17-19-15, was filed by Mountain States Telephone and Telegraph Co., Intermountain Power Agency, Union Pacific Railroad and the Denver & Rio Grande Western Railroad Co. Similar lawsuits have been filed throughout state district courts challenging the statute, which was implemented in January 1987.According to the lawsuit, filed in 4th District Court, the statute "imposes a statewide levy upon all real property to recoup local property tax collection costs, encourages inefficiency and increased tax costs by unconstitutionally divesting county governments of control over the administration and implementation of local property taxes."
The suit says the plaintiffs have paid nearly $2 million in governmental costs "purportedly incurred in collecting their property taxes - despite the fact that this exaction bears no relationship to the actual expenses of the local taxing jurisdictions involved. Plaintiffs seek a declaration that the statute is unconstitutional, as well as a refund of all sums paid pursuant to the statute."
In addition to naming the county and county commissioners Malcolm Beck, Gary Anderson and Brent Morris, the suit names County Treasurer Leonard Ellis, County Assessor Ron Smith, members of the Utah State Tax Commission, State Auditor Tom Allen and State Treasurer Edward T. Alter.
The suit quotes a statement by Attorney General David Wilkinson dated last Feb. 11, in which he concluded that the statute "unconstitutionally intrudes on the right of local self-government vouchsafed to the counties" by the Utah Constitution.
Before the statute's implementation, assessment and collection of property taxes was administered primarily by local taxing authorities throughout the state. But since enactment of statewide tax assessment and collection, the lawsuit says, "the total tax collection costs for all counties in the state have more than tripled, rising from $7,454,107 to $22,734,966."
In Utah County, tax assessment and collection has risen by about $1 million under the new statute, the lawsuit says.
The plaintiffs seek attorney's fees and a declaration that the statute violates the Utah Constitution and the 14th Amendment of the U.S. Constitution. In addition, they seek "a declaration that the fees assessed the plaintiffs under Utah Code Annotated 17-19-15 were unlawfully collected and an award of all sums paid under protest, together with lawful interest."