House rejects bill to extend city ‘ZAP’ tax authorizations and allow 1.5% administration fee

The Utah House debated and then rejected House Bill 405 on Feb. 26, 2008. Representative Stephen Sandstrom sponsored the bill, which would have aligned municipal ZAP (local sales/use) tax rules with county provisions by extending reauthorization periods for certain municipal taxes from eight to ten years and permitting municipalities to use up to 1.5% of revenue for program administration.

Sponsor’s case: Representative Sandstrom said the bill "brings the city's ZAP tax in line with the county provisions" and that the change would apply only to reauthorizations or new municipal measures, not to existing voter-approved terms. He said the League of Cities and Towns and nine municipalities supported the alignment.

Opponents’ case: Several representatives said the bill reduces local control and takes funds that voters had approved for program purposes. Representative Harper argued that even minor administrative deductions and longer authorization periods represent an "intrusion into the state's taxing authority" and urged defeat. Representative Carroll said he disliked a one-size-fits-all approach and would respect the choices of local communities who had already voted for these taxes.

Outcome: After debate and amendment discussion, the House voted the bill down: 25 yes, 45 no and 5 absent. Sponsor Sandstrom said the bill was intended as a consistency and housekeeping measure, but opponents prevailed.

Next steps: Because the House rejected the measure, HB 405 is filed and will not proceed; municipalities retain their prior authorization periods and administrative rules absent future legislation.