SALT LAKE CITY — A new study released by an environmental group claims that 20% more water could be put into the Great Salt Lake if property tax laws were changed to force conservation.
The proposed bill in the Utah State Legislature, first reported by FOX 13 News in May, would remove water use from under the umbrella of property taxes. Right now, people do pay rates but the vast majority of water is covered by property taxes.
“We can give property taxpayers back their property tax money and we can reduce upstream water use in the Great Salt Lake by 20% by doing that,” said Zach Frankel, the executive director of the Utah Rivers Council. “It’s not just about incentivizing homeowners to save water. It’s about incentivizing schools, churches and universities that don’t pay a cent in property taxes to save water. These institutional users are massive water users because they have massive properties using treated culinary water.”
The Great Salt Lake is currently at a historic low and is projected to continue to decline. It has dropped dramatically as a result of water diversion, the mega-drought and impacts from climate change. It presents a significant public health, ecological and economic threat to the state with toxic dust, a reduced snowpack and impacts to wildlife and industries that rely on the lake. State leaders have rallied to try to reverse the declines, spending money and passing bills to push water conservation.
The Utah Rivers Council said it studied 342 wholesale water suppliers across the western United States — Washington, Oregon, Montana, Nevada, Colorado, California, Arizona, New Mexico and Texas — comparing their property tax collections to Utah’s. It compared them to the Central Utah, Weber Basin, Jordan Valley, Washington County and Metropolitan (Salt Lake City and Sandy) water districts.
The group said that Utah water suppliers collected three times more property taxes than the other states. (Montana, Nevada and Washington did not collect any money from property taxes.) The Utah Rivers Council said it found Utah’s largest water suppliers collected $132 million compared to $83 million for 100 water suppliers in seven states.
Over-collecting property taxes lowers the price of water, which leads to overconsumption of water, Frankel argued.
“If we continue to over-consume water upstream in the Great Salt Lake, we’re going to be required to spend billions of dollars on mitigation because of dust problems,” Frankel told FOX 13 News. “We could avoid that by phasing out property taxes and lowering water use.”
Last week, a bill to carve out water from property taxes was formally introduced in the Utah State Legislature’s Interim Revenue & Taxation Committee. Its sponsor, Sen. Dan McCay, R-Riverton, told FOX 13 News that tying water use to rates would show people the “true cost of water” and force more conservation in the drought.
"As people see the potential for their bill to go up, they’re going to start looking at how do I cut back, how do I change?" he said.
It would also mean major institutions like schools, churches and nonprofits would have to start paying more for water they use. A major nonprofit property owner in Utah — The Church of Jesus Christ of Latter-day Saints — has so far declined to weigh in on the bill (though Sen. McCay said he has yet to hear an objection from them to it).
But the bill faced significant pushback from water districts and groups representing local governments. They had concerns a major change could impact how critical water infrastructure projects are paid for and drive up rates for consumers.
Laura Briefer, the director of Salt Lake City Public Utilities, told FOX 13 News that she had big concerns with the bill. While her agency doesn’t charge taxes for water (everything is in a rate) she said the “cascading impacts” of the bill need to be thought through.
“We want to make sure our rates are equitable across different user groups that residents are paying their fair share, industry is paying their fair share and we’re not putting all of our costs on current generations and future generations are benefiting from them,” she said in an interview on Tuesday.
Briefer said it was also important for water providers to have a stable source of revenue to pay for those major water projects for public health and safety.
“We don’t have enough information about these unintended consequences. I get the sentiment behind the bill that we want people to understand the true value of water,” she said. “I completely understand that, especially as we’re seeing aridification and the Great Salt Lake issues. That’s really important.”
The bill was getting bipartisan support from lawmakers grappling with the drought and the shrinking Great Salt Lake. Sen. McCay agreed to hold the bill while he negotiates with the water districts. He intends to bring it before the committee for a vote next month.
