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Moab passes on property tax: City Council declines new tax after opposition

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The Moab City Council has been seriously discussing introducing a property tax since May of this year. Ultimately, councilmembers agreed that while a property tax will likely be necessary sometime in Moab’s future, the time to introduce it is not now.

The Moab City Council passed a motion to approve the 2021-2022 budget with no property taxes at its regular meeting on August 24. The motion passed 4-1, with Councilmember Kalen Jones dissenting.

The city hasn’t levied a property tax since 1992 and is one of only four municipalities in Utah that doesn’t currently collect a property tax. The proposed tax revenues were for infrastructure or capital improvement projects, increasing police department staffing and raising the city’s reserve funds. The tax was met with opposition by some local residents.

The council was presented with four levels of property tax revenue on which to approve the budget: $1 million, $1.5 million, $2 million, or maintaining the current tax revenue level of $0.

Jones opened the property tax discussion with a motion to approve a property tax revenue of $1.5 million, but the motion was not seconded.

Council members Mike Duncan and Tawny Knuteson-Boyd have previously said they were considering approving a property tax—Duncan has publicly praised the $1 million property tax revenue plan—but on August 24, they both voted not to pass a tax.

“I don’t want to punt this down the road but at this point, I am going to vote for a zero property tax,” Knuteson-Boyd said.

She said there will always be people who can’t afford a tax, but opposed the proposal this time around because the discussion had become “ugly and divisive” in the community.

While “there will never be a good time” to implement or increase taxes, Knuteson-Boyd said, she was troubled by “name-calling and bullying” around the issue.

Duncan said what swayed him into voting for a budget with no property tax is the timing. The city hasn’t done a good job of assessing what capital improvement projects they want, he said, and there has been vocal opposition from some citizens strongly opposed to a potential tax.

Despite the tax being voted down this year, Duncan said he expects it to come up again because “it needs to.”

“It’s not going to go away, folks,” he said, but noted that he was “comfortable” putting it off for a year or two—Duncan will not vote on a future property tax, as his term as council member ends this year.

“I don’t think it’s the end of the world either way,” Duncan said. “I think we will all survive.”

Councilmember Karen Guzman-Newton, who has vocally opposed a property tax, said she doesn’t believe the city has its priorities straight. At a previous discussion, she noted that projects on the list of capital improvements lack information and context.

“I share the same frustrations as [others] regarding how things are run at City Hall right now,” Guzman-Newton said. She agreed with some public comments that the city should be more transparent and introduced the idea of hosting a public “salaries workshop.”

Guzman-Newton has been firm that the budget needs to be reassessed before introducing another property tax motion in the future.

“If capital improvement projects is our priority…we need to put our money where our mouth is,” Guzman-Newton said.

Councilmember Rani Derasary has also been opposed to the property tax since discussions started. She also noted that in future discussions on a potential property tax, the city, the community and the county should all work together more—the rest of this year should be treated as a “teach-in,” she said.

“I’m hoping that part of what we can all work on collectively is … more professionalism and mutual respect when we have conversations,” she said. But she also wants the city to work harder to fact-check popular rumors, and the community to “please spend a little time learning the truth,” she said.

Tourism dollars have been an extremely popular talking point of the citizens—people have been noting that the city has a population of around 5,000, but annually sees 3 million visitors, as reported by the Salt Lake Tribune in 2019. Why should 5,000 people have to pay for infrastructure to support 3 million?

But Derasary noted that not all revenue from tourism dollars or sales tax goes directly to the city.

At the August 10 council meeting, data introduced showed that while the sales tax in Moab is 8.85%, the city only keeps 2.8% of the revenue. Also, sales tax isn’t a reliable revenue stream.

“We really owe it to ourselves and each other to look at what tourism can realistically pay for,” Derasary said. “I think there’s a misconception that we get tons and tons of money coming into the city that can pay for everything five times over.”

Derasary said she sees a property tax in Moab’s possible future, but the timing this year wasn’t right.

“Moab is getting more and more expensive and it’s harder and harder to live here and that is really scary,” Derasary said, citing stressors like properties getting reassessed soon, the COVID-19 pandemic, and a prominent affordable housing crisis.

In a last-ditch effort, Councilmember Kalen Jones proposed an amendment to the motion to add a small property tax revenue of $360,000. He said he believes this is the best year to pass a small property tax—he noted that city property owners would pay less this year than last.

“A lot of time and money has been invested in moving [the property tax discussion] this far,” Jones said. The amendment was not added.

“This will give us a chance for a pause and a reset,” Councilmember Tawny Knuteson-Boyd said. Regardless of who sits on the council and what issues come up in the future, Knuteson-Boyd said that she hopes “we can engage civilly again, with purpose, and with function.”

The Moab City Council meets on the second and fourth Tuesday of every month at 7 p.m. Meetings are streamed online at the Moab City Youtube channel. Schedules, agendas and opportunities for public comment can be found at www.moabcity.org