Saturday, August 30, 2008

Thoughts for the Day

Your representative owes you, not his industry only, but his judgment; and he betrays instead of serving you if he sacrifices it to your opinion.

= = = = =

To follow, not to force the public inclination; to give a direction, a form, a technical dress, and a specific sanction, to the general sense of community, is the true end of legislature.

Edmund Burke (1729 - 1797),
political theorist,
observing two contradictory
yet equally valid aspects
of representative government

Monday, August 25, 2008

Rethinking Recycling

In June, I wrote to explain my vote against mandatory recycling in American Fork. (See post here.) Among other things, I wrote that residents would have until August 31 to opt out of the recycling program. This much has proven false -- tomorrow night's agenda, that of the last Council meeting before August 31, makes no mention of a recycling ordinance. I deduce hereby that the program is on hold until further notice.

Last Friday I accepted an invitation to tour the material recovery facility (recycling center) of Waste Management, a national provider with a strong presence in Utah, and was impressed by what I saw. I toured with members of the North Pointe Solid Waste Special Service District (SWSSD) board, led by the highly estimable Rodger Harper, district manager.

I learned that I have been asking the wrong questions about recycling.

Here's what I learned:

Landfills are, well, filling up, which is why the North Pointe board has commissioned a thirty-year study. The study, to be concluded in November 2008, will point to next steps for the north county's waste management programs.

While the study has yet to be completed, this much is known: The North Pointe transfer station handles 220,000 tons of refuse per year, including construction and demolition dumping. This figure translates to 4 pounds per person per day, a figure which is equivalent to the national average.

From the transfer station in Lindon, waste is hauled to landfills where the district pays $4.5 million annually in tipping fees. As Mr. Harper points out, the highly attainable goal of 30 percent household recycling could reduce that sum by at least $1 million per year, and would delay and reduce the need to open new landfills.

This creates a clear financial incentive to local governments such as ours to promote recycling.

Recycling centers relieve stress on landfills, but they are also key producers in a commodities market which, though it fluctuates from year to year, is becoming consistently profitable.

When I moved to Utah (ten years ago this month), I was told that recycling was not cost-effective here because of the distance between our desert communities and secondary markets. Mr. Harper says the situation has changed in the last ten years, due to a number of factors. Better sorting technology has reduced processing costs, and Utah's population has grown to the point where significant economies of scale are emerging. Meanwhile, the market demand for recycled commodities is increasing as new technologies are developed and as more foreign players enter the market. China and India, in particular, are clamoring for recycled goods to feed their manufacturing industries, to the point that prices for recycled cardboard have doubled over the last four years.

Waste Management, whose facility we toured, reports that twenty percent of its sales go overseas.

At this facility, commodities are sorted and bundled, then sold to manufacturers. Sale prices are usually sufficient to cover the cost of hauling, sorting, and handling recyclables. The only cost left to be paid is curbside pick-up.

The free market will not sustain recycling centers if they operate at a loss, so the cost of curbside pick-up must be passed along somewhere. Local governments, increasingly, are finding they have a compelling financial interest in recycling -- as does ours, when we consider the financial and public health costs of opening new landfills. So the tab for curbside collection is picked up by local governments, and is generally passed on to residents in the form of pick-up fees.

American Fork, which has a fourteen percent take-rate, must charge $4.50 per month for collection. Orem and Lehi, who have universal recycling, are able to spread the cost among more residents and reduce the monthly fee to $3.00.

My question -- Does it cost more to landfill recyclables or to haul them to distant markets? -- was the wrong question. Local governments do not assume the hauling cost; that cost is borne by the purchaser.

In terms of the big picture, I still believe it pays to ask whether hauling with fossil fuels is the best thing for our environment -- but so long as our nation remains dependent on its highway transportation system, our City Council isn't going to make a meaningful difference by landfilling in order to keep a few trucks off the road.

If City staff does come back with that ordinance, I still want to see more complete information. Among other things, I want to know whether American Fork is paying reasonable rates for its collection service, or whether the City could save money by using the North Pointe SWSSD transer station. (Allied Waste, the City's provider, has its own transfer station and landfill.)

Still, my eyes were opened by this tour, and I can highly recommend the tour to you. Waste Management of West Jordan welcomes Boy Scout and other tour groups by appointment (call 801-280-8200 for further information).

Here's what you'll see:

Some 60 tons of mixed plastics, metals, and paper are dumped on the plant floor each day, where a large loader lifts the tonnage onto a conveyer belt leading to a V screen. The V screen uses a magnet to send ferrous materials in one direction, and uses air to blow the lighter-weight materials (newsprint, grocery bags, aluminum cans) to a new conveyor belt.
I saw two separate conveyor belts whose contents were sorted by hand. One belt handled milk jugs and similar heavy-weight materials; the belt of this picture handles the light-weight materials. About five different containers were arranged ergonomically around each worker, so that he or she could sort quickly and comfortably. The plant is run by forty employees.
Mountains of bailed pop bottles are now ready for market. This facility sends just twelve percent of its input to landfills. Of this, seven percent is too small for the machinery to sort; the other five percent is rubbish which consumers mistakenly discard with their recyclables. The remaining eighty-eight percent goes to market.

Tuesday, August 19, 2008

Pressurized Irrigation Updates

This is the most glorious time in American Fork's existence, if you happen to be a three-year-old boy.

No matter where you go, there are diggers to see.

That's not to mention loaders, tractors, and road rollers.

Moms in search of the best viewing for their young 'uns can find the latest information on road closures and detours by following the AFPI link at Jessica Wilson, Horrocks Engineers' public information coordinator, tells me this site has had more hits than that of any other project managed by Horrocks -- including UDOT projects.

While you're there, check out the site's other informative features including FAQs, connection how-to, user rate schedules, and details on the next open house (September 30 at Greenwood Elementary).

Just be sure to keep a safe distance from any actual construction.

Wednesday, August 13, 2008

Council Approves 17.14 Percent Tax Increase

I voted against it.

More details at my husband's blog:

Tuesday, August 12, 2008

Tuesday's Truth in Taxation Hearing

In accordance with the provisions of the Truth in Taxation act, American Fork conducted a public hearing on the proposed tax rate last Tuesday. About fifty souls appeared to protest the increase.

The City Council's job in this hearing is to listen, so I spoke very little. The only time I opened my mouth was to correct a misunderstanding about Truth in Taxation. I immediately regretted doing so, because the resident in question was not interested in understanding.

It grieves me that so many voters make so little effort to understand the law. The ultimate consequence of ignorance is unfortunate decisions at the polls, so at the risk of angering still more voters, I will take pains to clarify this point again.

It is true that property taxes go up as property values increase, but this is not a rate increase. This is appreciation. Truth in Taxation is the name of a law whose intent is to hold property owners harmless against appreciation. It does so by holding the City's revenue constant from year to year. If property values rise, Truth in Taxation reduces the rate which is multiplied against the property value, so that the City receives no increase.

Truth in Taxation succeeds insofar as it holds the City's revenue constant from year to year. But it fails the property owner whose property value increases. The reason is that the law works in the aggregate. Some property values go up, and the property owners there pay more. But other property values go down, and those property owners pay less. In the aggregate, the City's revenue is constant.

The outcome of Truth in Taxation is that it removes the automatic inflation factor from the property tax. So while the City's costs rise with inflation, its revenues do not. The only way out of this is for the City to increase the property tax rate by three to six percent each year (depending on the rate of inflation), or to increase it by larger amounts every few years.

That's my understanding of Truth in Taxation, and it is correct. So said Senator Howard Stephenson, who also came to Tuesday's hearing. Because he gave such a lucid explanation, I requested the tape so that I could transcribe his words verbatim. Here's what he said:

Mr. Mayor, Members of the Council: I'm Howard Stephenson, with Utah Taxpayers Association. I'm also a state senator representing Alpine, Highland and Lehi, and southern Salt Lake County. I appreciate being here. I appreciate your budget director providing the information for us to examine beforehand, and the openness that your City has shown in providing information, and that's very much appreciated.

I have often said that the City Council is the most difficult and challenging elective office in America because you're where the rubber hits the road, and you're darned if you do and you're darned if you don't, especially when it comes to taking taxes. As the taxpayer advocate for thirty years with the Taxpayers Association, I've seen a lot of tax hike proposals. I want to express appreciation for you looking more closely at this increase and cutting it back to less than a third of what was originally proposed. I think we need to recognize that that shows significant effort on your part.

Okay, that was beside the point, but I liked sharing it.

Continuing . . .

I want to let you and the public know that with Utah's Truth in Taxation law, which the Utah Taxpayers Association helped to get passed in 1986, we set forth a plan for requiring that when a taxing entity chooses to increase taxes above the current level plus whatever you get from new growth, you have to go through this process.

What that means is that there is no inflationary adjustment built into property taxes. Cities do get inflationary adjustments from other sources, the most significant of which is the sales tax. The utility franchise tax also goes up automatically with rates charged by the utilities. So you get inflation from those, but we will acknowledge that you don't get inflation from the property tax.

In fact, when people get reappraised, and their values are brought current, the rates have to be brought downward so that there is no windfall whatsoever to the City budget. We have examined that and we have found that has been the case.

Now some people may say, well, when I got reappraised, my taxes did go up even though there were no Truth in Taxation hearings, and the reason for that is that somebody else's taxes went down because it was just an average of the whole City or the whole County, depending on where the levy was established.
Clarity from a lawmaker is a wonderful thing.

Friday, August 01, 2008

Fourteen Percent Tax Increase?

If you read the newspaper, or if you just got your property tax notice in the mail, or if you are one of the many protesters with whom I dialogued during the Steel Days parade, then you already know that the City Council is considering a tax increase in order to balance the 2009 budget.

(It can be difficult to dialogue while traversing a parade route; one hopes in these situations that a simple thumbs down is enough to convey meaning.)

Last Friday, Mayor Thompson's annual letter to taxpayers made my neighbor wrinkle his nose -- "sugar-coating," he called it. (Read the text of the letter below.) Myself, I feel the letter painted an honest and open picture of the budget and its challenges. Among other things, Mayor Thompson explained that the current proposal is for a 14 percent increase, not the 50 percent of earlier reports, and that the chief causes are slow revenues and rising oil prices.

Paring down the increase meant deferring many significant needs, including an enforcement officer and additional office space at the public works building. The current proposal will raise taxes on the average home (valued at $240,000) by $41.44 per year or $3.45 per month, and feels like bare bones, even by my tight-fisted standards.

Still, I'm not voting for it.

I could have voted for an increase of three or four percent. Regular, small increases are necessary if American Fork is to keep pace with inflation. (Click here for Local Commentary's discussion of how Truth in Taxation undermines the property tax's built-in inflationary factor.) I might even have gone as far as eight percent, given that there was no such increase in last year's budget.

But 14 percent is too rich for my blood.

We residents already voted for a significant increase to the 2009 budget when we approved the water bond back in 2006. 2009 is the year our water bills will double. We don't need to swallow two increases in the same year, not when gas and grocery prices have cinched household budgets tighter than Aunt Tillie's corset.

In time of need, doing without is the first and most basic financial tool. If we can't trust our City to muster this basic skill at this time, how can we trust it later to employ the higher financial skills?

Dates of Budget Hearings and Vote

Tuesday, August 5
6:00 p.m.
Truth in Taxation hearing

Tuesday, August 12
7:00 p.m.
Budget hearing

7:30 p.m.
Adoption of the certified tax rate and
Budget adoption

American Fork City Hall
31 North Church Street

Text of Mayor Thompson's Budget Letter

Here follows this year's version of Mayor Thompson's annual budget letter. It was mailed to all residences last Friday. Say what you will about the budget increase -- but let it be said that Mayor Thompson always communicates openly and honestly about the City's intentions, doing far more than the law requires.

July 25, 2008

Dear Residents:

During the month of August, the City Council will hold hearings to receive public comment on the City budget for fiscal year 2008-09. This budget will authorize City services for another year, and will continue this administration’s emphasis on public safety, infrastructure, and financial accountability.

Budgeting in the current economy brings many challenges. On the one hand, revenues from the sales tax, the gasoline tax, and building permits are down. On the other hand, many of the City’s operational costs have increased due to inflation and the rising prices of oil and petroleum products. The City’s residents face many of these same challenges, of course, and residents will also begin paying for the pressurized irrigation system this year through increased water fees.

Because of these added pressures, the City Council has employed several strategies to keep the City budget and its associated tax burden as light as possible. The Council has set a goal for the City’s arts and fitness programs to become self-sustaining. The City has begun charging impact fees to new construction so that many of the costs attributable to growth will now be paid for by that growth. In the short term, several new hires and capital equipment purchases have been deferred. Looking at the long term, the Council successfully completed the sale of the in-city broadband network, and will begin marketing its fiber assets in order to offset the cost of the bond.

All of this results in a proposed budget of $76.83 million, which includes a tax increase of 14 percent over last year’s certified tax rate. On a home valued at $240,000, this increase will translate to $41.44 per year or $3.45 per month. Combined tax revenues and new growth will raise approximately $757,610 in additional revenue for a total budgeted property tax revenue increase of 27 percent. (The newspaper made preliminary reports of a 46 percent increase to the tax rate and 62.76 percent increase in revenue. These figures were ared down in subsequent work sessions during which Council members took a hard look at City needs and chose to fund only the most pressing.)

Out of further concern for the taxpayer’s burden, the Council has opted to place several key items on the November ballot. This vote will allow residents to choose for themselves, by majority vote, which initiatives are most urgent and most affordable. These items include the purchase of land for cemetery expansion, several road and transportation issues, and the finishing of Art Dye Park. Further information on the bond elections will be mailed to homes in the fall. Please note that the bonds will not be treated in the August budget hearings.

Further information on the City budget and associated tax increase will be presented at the hearings listed in the box at the left. [See above.] Residents may also learn more by calling the City offices at 763-3000.

Sincerely yours,
Mayor Heber M. Thompson


To staff critical positions. Because of slow revenues, the Council has opted to defer several new hires and will add only those positions necessary to maintain the current level of service in an environment of growth. New positions include two full-time positions—a public works inspector and a utility operator; and two part-time positions—a grant writer and a risk manager. Additionally, three part-time positions will be upgraded to full-time—in the police department, a victim advocate and a records clerk, and in the library, a network technician. The City recognizes that human capital is its most important asset and strives to retain quality employees and offer superior service, providing the greatest value to the taxpayer.

To provide needed maintenance for roads and sidewalks. Since 2006, the City has contributed $110,000 per year to sidewalk funding. City sidewalk funding will be matched this year by a federal grant to provide safe routes to school in the Shelley Elementary School area. The budget for road repairs will be increased by $250,000, as the City has been warned that funding projections for road repairs associated with the pressurized irrigation system will not be sufficient, due to rising petroleum and asphalt prices.

To protect the City’s financial standing. This budget provides for the hire of a part-time grant-writer (to boost revenues) and a part-time risk manager (to reduce liability). It also provides $348,000 in matching funds for a trail system connecting Art Dye park to the golf course and to Highland. Failure to match this federal trail grant would require the City to return $87,000 in engineering costs and forego $500,000 toward construction costs. More importantly, failure to complete the project will jeopardize the City’s standing for future transportation grants.

To provide for public safety. This budget will provide four new full-time emergency medical technician (EMT)/firefighter positions, fifteen to eighteen part-time paramedics, and one new ambulance. This means that the paramedic program, which has been planned since 2006, can now be activated. The budget also covers significant increases in emergency dispatch fees, a situation voters will want to keep in mind as the County considers the creation of an independent dispatch district.