LOGAN – Members of the Logan City Council approved a city budget of more than $217 million for Fiscal year 2024-2025, including a property tax increase.

Tentatively, that is.

Under the state’s Truth in Taxation law, according to Logan Finance Director Richard Anderson, that budget with its tax increase cannot take effect until city residents have been notified of the proposed rate increase and have been given an opportunity to express their concerns during a public hearing.

That process is expected to be completed sometime in August, Anderson explained.

The city budget proposed by Anderson as Resolution 24-22 totaled $217,392,820, with its property rate increase of .000965. That translates to about a 3 percent increase in the taxes on an average piece of city property, raising revenue by between $10 and $20.

At the council’s regular meeting, Anderson estimated that the tax increase would be about $11 on the average home and $19 for a business.

In her remarks, Mayor Holly Daines told council members that the property tax increase was necessary in the fiscal year beginning July 1 because revenue from sales taxes are expected to remain fairly flat. Those taxes are the city’s most significant source of revenue for its general fund, she added.

Prior to enactment of the Truth in Taxation (TNT) Law in 1985, local city and county governments received an automatic tax revenue increase whenever property valuations increased.

But the Utah Taxpayers Association successfully argued that local governments should not receive, for example, an automatic 12 percent revenue increase simply because property valuations increased 12 percent.

Under TNT, property tax rates are required to be recalculated every year based on revenue. As property valuations increase, the tax rate is reduced accordingly so that the local taxing entity does not receive an automatic revenue increase.

If an entity elects to still increase its property tax rate, the municipality must notify its residents and hold a public hearing to accept their comments.

The proposed budget also includes a 5 percent increase in the fund assessment for the new Logan Library, to ensure adequate funding if Library Director Karen Clark needs to expand the facility’s hours or hire additional staff members.

That facet of the proposed budget provoked more discussion between council members than the property tax increase.

When Anderson acknowledged that the library could tap city financial reserves to fund expanded services, council member Mike Johnson said that he would prefer to use that option rather than raising taxes.

But council members Amy Anderson thought dipping into financial reserves was a bad precedent and Jeannie Simmonds suggested that any excess funds from the new taxes could be used for the library’s debt service.

The proposed city budget also includes nearly $7 million in transfers from city enterprise accounts.

A transfer, Anderson explained, is the movement of cash or other resources from one fund to another.

“If budgeted and planned for correctly,” he added, “transfers from enterprise funds can help to defray the cost of services such as public safety, public works, parks and recreation … to keep property taxes low.”

Without transfers, Logan City would either need to raise property taxes significantly or cut services.

The final — but still tentative — vote on the proposed budget in Resolution 24-22 was passed unanimously.

Later that evening, the council members reconvened in their role as the Logan Redevelopment Agency to also approve Resolution 24-23 RDA, setting the agency’s budget at $1,362,025 for Fiscal Year 2024-2025.

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