SALT LAKE CITY – The Salt Lake City Council adopted a new $2.1 billion budget in June, and with it comes a 12.5% property tax increase.
Salt Lake City Council Chair Alejandro Puy told Utah Junction that the tax increase is part of the city’s effort to balance the budget as the cost to run the city increases amid rising inflation.
Of the $2.1 billion, $498.2 million goes toward the city’s general fund, which provides money for the city’s daily operations, like public safety, planning, and parks for the 2027 fiscal year.
Salt Lake City Mayor Erin Mendenhall’s budget proposal included over $13.2 million in recommended cuts, most of which the city council adopted.
Puy said part of the council’s decision-making around the budget had to do with deciding what to cut.
“We were in a place where we needed to decide if we needed to make the difference with the tax increase or stop some services,” Puy said.
The result was a mix of both.
Ultimately, cuts included the Utah Transit Authority’s Hive Pass, which offered city residents a reduced-cost yearly pass. The city council also decided to suspend a program that aimed to improve air quality by providing vouchers for residents to exchange gas-powered lawnmower equipment for electric alternatives.
Open positions with the city were also left vacant or eliminated as part of cost-cutting measures. The mayor also said the city decided not to implement cost-of-living raises for all of its employees.
“Instead, we are prioritizing targeted raises for frontline workers and those whose wages are below market rate,” Mendenhall said in her May speech to the city council and city residents, where she introduced her budget proposal.
She emphasized the city faced a choice between those more targeted raises and mass layoffs.
Costs are going up for Salt Lake City
Puy said that deciding what to cut is difficult when balancing residents’ needs with the reality of rising costs.
“We’re very concerned about the challenges our neighbors are experiencing. The challenges the neighbors are experiencing, the city also experiences them, right? Like inflation and the cost of products and services, it affects us as well.”
The burden of inflation was highlighted in Mayor Mendenhall’s May speech.
“This budget reflects current reality—a time when federal funding to municipalities is shrinking, when fuel and materials are becoming more expensive, and when inflation continues to impact households and businesses alike,” Mendenhall said in her speech. “Unfortunately, these rising costs don’t stop at the household level. They are also driving up the cost of delivering the basic services our city depends upon.”
Although the city made several cuts, the budget was still in need of $13.5 million to balance out.
The property tax increase will generate that additional $13.5 million.
Puy said he knows residents are concerned about taxes increasing.
“No one likes to hear that taxes are going up, right? That is a universal truth. It’s a universal truth for us as well. We didn’t want to do this. But, we couldn’t find the consensus to make more adjustments.”
Salt Lake City will hold a public truth-in-taxation hearing on August 11. Puy encouraged residents to share their feedback and attend the meeting.
“There is plenty of opportunity to shape programs and the city budget,” Puy said.
Another property tax increase might be on its way
Puy said the city is trying to rely less on fluctuating revenue like sales taxes.
“When the economy is going down, sales taxes go down too. And we’re seeing some of that. That pays for a lot of our services as well. So, trying to rely less on fluctuating taxes and more on reliable sources is always the goal.”
Those more reliable sources include property taxes, but Puy acknowledged that it can be hard on property owners.
Although the city is working toward developing more stable sources of revenue, it can’t escape rising costs.
“The cost of running the city is getting harder and harder to maintain. So we are, from the council side, worried about the possibility that we may need to do this again next year, and we are not very happy about it,” Puy said.
He worries that next year may see tougher decisions, especially in regard to needing to cut programs and staffing.
