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City Council Approves One Tax, Considers Another

Aug 04, 2015 09:39AM ● Published by Bryan Scott

Shoppers in Murray

By Scott Bartlett

Purchases in Murray are about to get a bit more expensive, and may get more expensive still.

In its June 16 council meeting, the Murray City Council approved a 0.2% local sales tax. The tax is intended to make up for a $3 million loss in sales tax revenue the city suffered when the state changed its distribution formula in 2006. The loss of those funds has forced the city to skip projects it would have otherwise completed over the last nine years.

The list of unfunded projects has grown substantially and will continue to grow without an increase in funding, according to Mayor Ted Eyre. Public safety, roads and parks will be top priorities for the new revenue. The tax will go into effect October 1, and will equal $0.20 on every $100 purchase.

Justin Zollinger, Murray’s finance director, points out that they balanced the budget without the tax increase. A desire to return to previous levels of service was one of Eyre’s and the council’s main goals in passing the tax.

Sales tax may go up further still, but this time it will be up to Salt Lake County residents, not just the Murray City Council.

On March 27, Governor Gary Herbert signed HB 362 into law. This law, sponsored by Rep. Johnny Anderson (R-Taylorsville), changed the formula for calculating state gasoline taxes to alleviate a shortfall in road funding. 

The state currently charges a tax of $0.245 per gallon of gasoline. Beginning January 1, 2016, it will charge 12% of the previous year’s average gasoline price. The minimum average price used will be $2.45, with the maximum being $3.33, even if the calculated average falls above or below that range. This means that the minimum state gasoline tax will be $0.294 per gallon, with a cap of $0.40 per gallon.

The law includes a provision for each county in the state to enact a 0.25% local option sales tax, which is the issue now before the city council. The tax would equal $0.25 on every $100 purchase.

The law requires that the tax be put to a vote, and the council voted in favor of a resolution encouraging Salt Lake County to hold that vote this November. While the just-approved Murray local sales tax would cover multiple types of projects, this proposed county-wide tax would be dedicated solely to transportation.

Councilmember Brett Hales stated that by voting for the resolution, he’s not necessarily in favor of the new tax, but he does want to let voters have their say.

“I’m in favor of putting it on the ballot so that the citizens can make a decision,” said Hales.

If passed, funds from the new tax would have to be used for transportation projects such as roads, pedestrian and traffic safety, and public transit. Salt Lake County government must decide this August if the tax will be included on the November general election ballot.

Of the 0.25%, 0.1% would go to the Utah Transit Authority, 0.05% would go to Salt Lake County, and 0.1% would go to each city within the county. Murray finance director Justin Zollinger estimates that Murray would receive about $1.3 million per year.      


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