You may have heard that Park City and Summit County governments are gung-ho about raising taxes related to “solving” transportation problems. We understand their passion. A few times each year, and on the occasional Saturday, traffic backs up from Sidewinder Drive to Summit Park. It must be solved… we guess.
According to the Park Record, Park City and Summit County are contemplating a sales tax for help with
buses transportation. County Council member Chris Robinson said, “I think this is very good and it looks promising because it is not a big lift, it is not regressive and it is not on food and gas. I think by seizing this today it will solve our own problems.”
Usually we agree with Mr Robinson, but in this case we find a few issues. It will be more expensive to buy cars here. It will be more expensive to buy back to school clothes in Park City. It will be more expensive for residents to dine out in Park City. Ski passes will cost more here. While perhaps its not regressive in the most pure sense, it still impacts Park City’s working class (i.e. people who live and work here). These are the things that many of us “regular” residents do in Park City. It’s true that a .5% increase in sales tax won’t impact the average Parkite too much. If you spent $100,000 around Park City, it would cost you $500 extra. Most of us don’t spend that kind of money each year, but every dollar does count.
What we wonder is if there is a better way to not only raise money for transportation but also for our schools and other areas of need. What we wonder is if the resorts are paying their fair share of property taxes.
For example, take parcel PCA-S-98-PCMR-1. That represents 2400 acres in the heart of old PCMR, just west of Park City. What’s the market value of this property? $6.1 million or $2,500 per acre. Let’s compare that to 528 Park Avenue. What’s the market value of this .04 acre property? $563,000 or $14 million per acre. That means a piece of land, with a tiny house on it, is valued 5,800 times more per acre than the land used to make skiing possible at PCMR.
How can that be?
First, let’s state that it isn’t an apple to apple comparison. The land with the house obviously has improvements on the land which increase its value (i.e. the “what appears to be” 400 square foot house). The ski land has improvements too, like lifts, but it appears those are treated as personal property. So, it’s not a completely fair comparison, but the differences are so large that it made us wonder how the land used to make the ski resorts hum is valued so little in comparison.
So we reached out to Summit County Assessor Steve Martin. Mr Martin and the county’s Commercial Appraiser Jeremy Manning offered to meet to discuss the issue (that’s the great thing about Summit County government… everyone is more than willing to answer questions and help). We spent a few minutes on the phone and the answer became clear.
One of the main components of the market valuation is the type of zoning upon which this land sits. This land is zoned as OPEN SPACE. So whether the land is untouched open space … or zoned that way (and used to generate millions in revenues for ski resorts), it’s valuation ,and taxes, has a basis in how the land is zoned.
We asked Mr Manning if would be possible to zone the land in a different way, such as a “Open Space Ski Resort Zone” thus potentially providing a mechanism to value the land more appropriately. Mr Manning said that may be possible but it would make his job more difficult because there is not a lot of that type of land out there.
We’re frankly not sure the legality of changing the zoning. There could be Utah laws prohibiting that. There could be legal issues related to deed restrictions that have been placed on the open space land that force it into a type of planning zone. There could be other issues.
What we do believe is that the land that is used by ski resorts for runs and lifts should not be treated like other pieces of open space, that may not need usable for commercial purposes. $2500 per acre isn’t a lot of market value per acre for a ski resort. Maybe better said, the $21 paid each year in property taxes for each acre likely isn’t commensurate with the real value of that land to Vail.
Should that land be valued at $14 million per acre? Likely not. However, somewhere in between $2500 and a few million per acre probably makes sense. That money could then be used to help fix transportation issues (that are in part caused by visitors to our resorts), help pay for schools, and be used in a variety of ways that would benefit our community.
If possible we may get more out of that than simply adding on a sales tax that both penalizes residents and is limited to transportation.