Council hears transportation utility fee proposal; discussion moved to unfinished business for more outreach

A consultant presented a plan for a transportation utility fee to fund roadways, trails and street lights, and the South Salt Lake City Council voted to move the proposal to unfinished business so staff can notify businesses and return with additional information.

Why it matters: The proposed enterprise-style fee would create a dedicated revenue stream for transportation capital and maintenance, with charges based on land use type and an "equivalent residential unit" (ERU) methodology that adjusts for vehicle axle weight to reflect impacts from heavier vehicles.

Consultant Cody described the methodology used to calculate the fee, noting that the analysis included operating and capital costs, pavement-management needs and reserve targets. Cody said the 10-year capital project list totals about $68.8 million in present dollars and that a transportation utility fee would generate a self-supporting revenue stream separate from the city's general fund.

The proposed structure groups users into four categories (residential; office; retail/commercial; industrial) and applies multipliers per thousand square feet or per dwelling unit. Cody said the city's proposal includes adjustments for axle weight, making heavier vehicles (for example, semitrailers) carry proportionally higher fees; he said other cities that have adopted fees typically do not include axle-weight adjustments.

Council members asked whether residential customers could be exempted; council consensus at the meeting favored waiving residential charges and focusing the fee on businesses that create daytime traffic. Cody and staff also discussed whether places of worship should be excluded; the consultant said a recently proposed bill (HB 454) that would have addressed exemptions did not pass and that the city's authority follows a Utah Supreme Court ruling that found municipalities may implement such fees when a clear link exists between demand for service and fee-for-service budgeting.

Council did not adopt the fee at the meeting. Clarissa moved to place the item in unfinished business and required staff to notify affected businesses on the July utility bill; the motion passed with a second and roll-call vote. Staff said the item will return for further consideration at the next meeting after outreach to businesses and additional briefing materials.

What's next: Staff will notify businesses that would be subject to the fee, provide additional details and bring the item back as unfinished business at the next council meeting for further public input and possible action.