The County Courthouse is considering several options to address funding gaps forecasted in next year’s budget as the pressure to maintain and expand programs builds. But as community demand increases, Summit County officials will be tasked with deciding who will be expected to pay for the services.

Chief Finance Officer Matt Leavitt met with the Summit County Council on Wednesday to present new challenges and opportunities for officials to contemplate as preparations begin for the 2025 budget cycle. Leavitt emphasized the need for officials to take a different approach to revenue sources this year to ensure there’s a balanced financial plan with the likelihood of raising taxes.

The County Council in December adopted an $81 million budget. However, they did so using one-time funds to balance ongoing operations to avoid raising taxes on the municipal services and general funds. 

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The County Council did approve tax increases in the assessing and collecting fund, which brought in $1.4 million, but Leavitt explained there’s still a $5.25 million shortfall.

“Not necessarily a good approach, not a sustainable approach by any means, but because of circumstances, we opted to use fund balances as opposed to going through Truth in Taxation,” he said. “We’ve got some room to make up.”

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There’s also pressure from the Utah Legislature as well as community groups to do and provide more for residents such as child care or mental health services, bringing additional budget strains to the county. Leavitt can foresee the 2025 budget easily exceeding $90 million because of existing services, new requests and inflation.

He provided four options, each with its own set of implications, for how to address the fiscal gaps as officials approach the upcoming year: do nothing, increase property taxes, implement a new sales tax or explore something else. 

Officials showed an apparent discomfort with raising taxes, though it seemed to be the most feasible option. Leavitt suggested the County Council go through Truth in Taxation to help sustain operations or enact the rural hospital sales tax.

It’s unclear just how much property taxes could increase if the County Council chooses that route. Leavitt estimated more than $5 million is needed to support the municipal services and general funds.

“To what level should we go through Truth in Taxation? Summit County has the second-lowest property tax rate with one of the highest values. So, you have a little bit of disparity there,” he said. “Summit County has $45.7 billion in 2023, and it’ll go up again for 2024, in taxable value.”

Instead of putting the burden on homeowners, the County Council could also take advantage of a sales tax initiative expanded by the state Legislature.

The rural hospital sales tax is a 1% tax on certain transactions. It is intended to offset the impact of tourism. 

The money can only be used to address emergency medical services, law enforcement, fire protection, search and rescue, solid waste disposal, avalanche forecasting or a combination. Those programs would be funded through the sales tax, freeing up municipal services and general fund money for other services.

A 0.4% sales tax would bring around $11.8 million to the community if enacted. Leavitt said that’s almost enough to cover the Summit County Search and Rescue program. It would also make a significant difference in addressing other problems such as the $2.5 million, much-needed landfill cell expansion.

The sales tax would help address the existing gaps, but it may not be enough of a long-term solution to supplement the municipal services and general funds. 

Voters would have to approve a ballot measure for the rural hospital sales tax. The revenue would start to come in June 2025 if it passes. Wasatch County approved a 0.5% sales tax increase last year, which officially started last month.

Another option was for the County Council to make budget cuts. An estimated $10 million would have to be taken out to create a balanced budget, making it difficult to maintain the same level of service for existing operations.

Summit County could also lobby the Legislature to change the requirements of the Resort Community Tax, address the fee schedule or find another solution.

The County Council agreed it wanted to choose the option that would have the least impact on residents. 

Vice Chair Tonja Hanson wasn’t thrilled about the idea of raising property taxes, but she also expressed concerns residents might not support the sales tax increase. 

The County Courthouse would also have to prepare for Truth in Taxation, which usually occurs in December, at the same time as the ballot measure in case the rural hospital sales tax fails. Community members have protested property tax increases for at least the past two years.

County Councilor Roger Armstrong advocated for fiscal responsibility. He also suggested the county go through Truth in Taxation because the state recommends it occurs every five years.

The municipal services and general funds haven’t been raised since 2017, and they pay for just under 90% of daily operations including ambulance services, road maintenance, community development and planning, the library, public health and more. 

No decisions were made this week. Leavitt will return in about a month with more information about the potential options.