DesNews: UTA wary of lagging sales-tax revenues
UTA wary of lagging sales-tax revenues
By Laura Hancock
Deseret News
Published: Thursday, Dec. 18, 2008 12:10 a.m. MST
The Utah Transit Authority's board of trustees on Wednesday adopted a $280.1 million budget for the year beginning Jan. 1 — an amount that was only $1.7 million more than the previous year.
Sales taxes, UTA's primary source of revenue, have been down because of the recession. Sales-tax revenues in 2008 were 18 percent less than what was originally projected, trustee Terry Diehl said.
UTA General Manager John Inglish anticipates that the next 18 months "will be tough" for his agency.
"I'm real confident in this budget that we can make it work," Inglish said. "And this is the kind of budget we have to make work."
UTA budgeted for a 1.5 percent decrease in sales-tax revenue between 2009 and 2008. If sales taxes in 2009 prove to be less than projected, routes could be cut.
"Laying off people is the last thing we want to do," UTA spokeswoman Carrie Bohnsack-Ware said. "We never want to do that. Cutting service is not something we want to do, either. And in this economic climate right now, it's hard to say what could happen in the future. And so, if in fact we do have to cut service, it will be the very lowest performing routes that make the least amount of impact to our riders."
Ridership was up in 2008 to 36.3 million trips, 12.2 percent from the previous year, as prices at the gas pump tipped to $4.22 this past July. In 2007, Utahns took 32.3 million trips on buses, light rail or van pools. UTA started FrontRunner Commuter Rail service in April.
"The money we get from riders, the fare collection, is typically about 17 percent of what it costs to maintain the system," Bohnsack-Ware said. "Even if we did have a high number of riders, it doesn't make that much of a difference in riding the system. So sales-tax revenue is the big deal."
UTA operates in six counties in northern Utah. It will be adding service in Eagle Mountain and Saratoga Springs beginning in April. On Jan. 1, sales taxes will increase a quarter-cent to 6.45 cents for every dollar spent in the cities. But the money won't be used on UTA services for three years, while the tax base is being built up. In that time, a $200,000-a-year grant from the federal government will fund the service.
E-mail: lhancock@desnews.com
http://deseretnews.com/article/1,5143,705271296,00.html
By Laura Hancock
Deseret News
Published: Thursday, Dec. 18, 2008 12:10 a.m. MST
The Utah Transit Authority's board of trustees on Wednesday adopted a $280.1 million budget for the year beginning Jan. 1 — an amount that was only $1.7 million more than the previous year.
Sales taxes, UTA's primary source of revenue, have been down because of the recession. Sales-tax revenues in 2008 were 18 percent less than what was originally projected, trustee Terry Diehl said.
UTA General Manager John Inglish anticipates that the next 18 months "will be tough" for his agency.
"I'm real confident in this budget that we can make it work," Inglish said. "And this is the kind of budget we have to make work."
UTA budgeted for a 1.5 percent decrease in sales-tax revenue between 2009 and 2008. If sales taxes in 2009 prove to be less than projected, routes could be cut.
"Laying off people is the last thing we want to do," UTA spokeswoman Carrie Bohnsack-Ware said. "We never want to do that. Cutting service is not something we want to do, either. And in this economic climate right now, it's hard to say what could happen in the future. And so, if in fact we do have to cut service, it will be the very lowest performing routes that make the least amount of impact to our riders."
Ridership was up in 2008 to 36.3 million trips, 12.2 percent from the previous year, as prices at the gas pump tipped to $4.22 this past July. In 2007, Utahns took 32.3 million trips on buses, light rail or van pools. UTA started FrontRunner Commuter Rail service in April.
"The money we get from riders, the fare collection, is typically about 17 percent of what it costs to maintain the system," Bohnsack-Ware said. "Even if we did have a high number of riders, it doesn't make that much of a difference in riding the system. So sales-tax revenue is the big deal."
UTA operates in six counties in northern Utah. It will be adding service in Eagle Mountain and Saratoga Springs beginning in April. On Jan. 1, sales taxes will increase a quarter-cent to 6.45 cents for every dollar spent in the cities. But the money won't be used on UTA services for three years, while the tax base is being built up. In that time, a $200,000-a-year grant from the federal government will fund the service.
E-mail: lhancock@desnews.com
http://deseretnews.com/article/1,5143,705271296,00.html
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