West Jordan budget from the inside outAug 05, 2022 12:03PM ● By Erin Dixon
The big news is that West Jordan City Council is hosting a Truth in Taxation meeting on Aug. 6. The proposed tax rate change would bring about $1 million more to the General Fund.
Most of that money will go to increased salaries for public safety and city employees, in an effort to retain employees by offering near the same salary they would earn somewhere else.
“Most cities are doing Truth in Taxation mostly because of public safety wages,” Finance Director Danyce Steck said.
To fund the city’s budget needs for the next year, there is also a transfer from the solid waste fund.
Salt Lake County decides the tax rate each year depending on the values in the city or tax area. This year the county gave West Jordan the certified rate of 0.001398, while West Jordan City is proposing a rate of 0.001476. Last year, West Jordan property owners paid a rate of 0.001788.
Even with bringing in more money through property taxes, the city will still use $2.3 million in reserve money.
The less exciting but equally crucial news is “What else is in the budget?” How is over $60 million used?
Changes in some of the city income
The city mainly gets money from sales tax, property tax and fees.
Construction and growth brings in some cash, but it’s locked into certain funds.
“If someone comes in and puts in a house where there wasn’t a house, then there’s an impact to the city,” Steck said. “Jones Ranch…will pay an impact fee for every single house that they build.”
These fees pay for the pressure on the city overall and fund road, park, police, fire, water, sewer and stormwater expansion only.
“All impact fees are specifically used for development of roads or parks or a new police substation, new fire station,” Steck said. “Park impact fees are paying for park expansion, not maintenance. Anything that is new that will support new growth.”
Finance predicts an income of $1 million from impact fees in the coming year.
Since 2020, when the United States government supported local governments during the pandemic, the city got several million dollars from the ARPA and CARES act. That funding line has stopped, which means there is less money to spend this year.
Where is all the money going?
The city budget is 333 pages long. Steck and Communications Director Tauni Barker met with the City Journals to discuss the intricacies.
Reserve money is being used to supplement large projects this year.
“When you see reserves going down that means we’re doing projects that are exceeding the current year revenue,” Steck said.
“This year we put quite a lot of capital improvement and projects in the budget. We accelerated some of our maintenance [on Class C roads] and sidewalks, water tank construction and new sewers.” (Class C roads are streets owned by the city.)
Some examples of large projects this year are: construction on 1300 W. between 9000 S. and 9400 S., 5490 W. 7800 S. roundabout, two pedestrian bridges and traffic signal installations. Park projects include trail development, Ron Wood bike and skate park and an east side dog park.
The Communications department is trimming its budget this year by several thousand dollars.
“Last year the council wanted to put some money in the budget to do a mailer about the budget,” Barker said. “It did go out in May.”
There will not be a mailer this year, some of their budget was moved to an Events department, but there is also less money for the communications staff in general.
“We also did a little bit of trimming,” Barker said.
The city council office had a major increase in their budget.
“City council personnel went up significantly,” Barker said. “There was an addition of a full-time staff member, and the office director’s pay was changed.”
$10,030,000 is waiting to pay for the City Hall remodel, and most likely will not need any increases.
“The contractor (Bud Mahas Construction) that we chose is well known for no price increases and known for almost always being on schedule,” Steck said. “We don’t anticipate any change orders or increases, but there is some contingency there.”
A note about water fees
“The council has directed me to do a water study,” Steck said. This means water rates may change for the city before October this year.
Currently, residents pay the most per gallon of water of the three categories: Residential (highest rate), Landscape and Commercial (lowest rate).
“Commercial water use is based on manufacturing. A Papa Pitas, Danon, businesses that rely and make commitments to use services. We’re not trying to change that,” Steck said.
Why are the other categories higher?
“On residential and landscaping we’re trying to influence usage,” Steck said.
Landscape watering rates are 90% from commercial use. “From Jordan Landing, large industrial parks, credit unions, big rolling lawns, HOAs and multifamily housing units,” Steck said.
Steck said when the council set the different rate, they didn’t want to bring more money in than was needed. “The challenge was to stay revenue neutral.”
Why is residential the highest?
“They don’t want a city that’s not aesthetic,” Steck said. “There are definite benefits to maintaining some landscaping. It draws people into the area.”
The money from water rates not only pays the bills to Jordan Valley Water Conservancy District, it pays for maintenance.
“We’re investing more over time for upkeep of water lines,” Steck said. “We have a large maintenance and repair plan. A lot of storage and wells have been added. After that we’re going to focus on replacing [old] lines.”
The city needs to spend more money on gas like everyone else. $100,000 extra has been invested to city vehicles.
The predicted road salt prices increased from $63,000 in 2021 to $125,000 in 2022. That price may be higher next year.
Chief Ken Wallantine did not ask for more police officers this year, but each officer’s pay is up 21% from 2021.
Neither the mayor nor city council members are getting raises this year.
Why is the city changing taxes when there is so much city growth and if property values are up?
“The city will receive the same total tax revenue year over year no matter what the city’s total taxable values are,” Steck said.
A property tax bill fluctuates based on several factors. Property values shift the burden of the city’s revenue depending on the change in value, and the city is not the only group that a resident pays property tax to.
The rate from the county changes every year to compensate for property values. Because values of different properties change each year, including commercial, the burden of property tax is redistributed based on each individual property value.
“[West Jordan] values increased about 30%,” Steck said.
If a property value increases by 30%, that property will not pay an additional 30% in taxes. Not every property in the city will increase by the same percentage. The property value of a city as a whole will be divided among all of the properties depending on the value of a property.
Residential properties only pay 55% of the tax rate, while commercial properties pay the full rate.
Not all of your property tax goes to the city
A West Jordan property tax bill will show more than just the city. Taxes go to Mosquito Abatement, Jordan School District, Salt Lake County, Salt Lake County Library, and a few more. λ