SALT LAKE CITY — Homeowners in high property value areas such as Park City will see some of their local taxes moved to cash-strapped, rural school districts if a bill debated Friday by the Senate becomes law.
SB81 was described by opponent Sen. Pat Jones, D-Holladay, as a "Robin Hood" bill, in that it is designed to take from rich districts to give to financially poorer districts.
"This takes existing monies and makes people winners or losers depending on what district you're in," Jones said. "Unless we have greater funds, real new money, this bill, I believe, is unwarranted."
The bill's sponsor, Sen. Aaron Osmond, R-South Jordan, said the bill would seek to address the arbitrary inequities between school districts created by the Legislature. In the past, he said, lawmakers drew district boundaries and set property tax caps, resulting in a scenario where areas such as Park City have a far greater spending power per student despite residents shouldering a lesser tax burden than the average Utahn.
The bill would raise the property tax caps for school districts whose per-student spending falls below the state average. It would also raise the minimum basic rate — a formula used to address inequity by siphoning property taxes from more affluent areas through the weighted pupil unit — resulting in more funds being redistributed.
SB81 would not result in tax increases, Osmond said, but school districts that benefit from the redistribution would be required to offset those funds initially by lowering property tax rates. From there, local school boards would be able to restore their local tax revenues through the standard public truth-in-taxation process, which would result in those districts seeing a net gain in revenue.
"We created the disparity," Osmond said. "This allows us to be able to have more equalized distribution through funding."
But equalization efforts would result in less funding for some of the state's more affluent districts, a fact that resulted in some opposition on the Senate floor.
Sen. Gene Davis, D-Salt Lake City, said the bill would take control out of the hands of local school boards that, with the approval of their constituents, establish property tax rates and levies to address the funding concerns of their local schools.
"Our equalization should be borne out of the income tax in the state of Utah," Davis said. "That's where we should be looking at the (weighted pupil unit)."
Jones also noted that the bill would disproportionately affect Utah families who pay taxes on second homes and typically do not have students who attend schools where their second homes are located.
The bill was circled prior to taking a vote to allow for further consideration by lawmakers and for the participation of Senate leadership, who were off the floor during debate.