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TO: |
Board of Trustees |
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FROM: |
Jay Fox, Executive Director |
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PRESENTER(S): |
Viola Miller, Chief Financial Officer |
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David Wilkins, Assistant Attorney General |
TITLE:
title
R2026-04-04 - Resolution Authorizing an Interlocal Cooperation Agreement with Willard City Regarding Sales and Use Tax Revenues
end
AGENDA ITEM TYPE:
Resolution
RECOMMENDATION:
Approve Resolution R2026-04-04 to authorize the Interlocal Cooperation Agreement with Willard City regarding sales and use tax revenues.
BACKGROUND:
Willard City of Box Elder County established a local sales and option use tax of 0.30% (1st Quarter Tax) on October 25, 2007 through adoption of the Willard City Ordinance 07-HH, to transfer revenues to UTA as a long-term funding source for projects and support of the public transit system.
Later on January 10, 2008, UTA and Willard City entered into an Interlocal Cooperation Agreement (the “2008 Interlocal”), under which the City transferred certain sales tax revenues to UTA (2nd Quarter Tax).
On April 11, 2024, Willard City attempted to repeal the 1st Quarter Tax and separately repealed the 2nd Quarter Tax. Additionally, Box Elder County also imposed a 4th Quarter Sales and Use Tax under Utah Code § 59 12 2219.
UTA and Willard City later mutually determined that the repeal of the 1st Quarter Tax was invalid. As a result, Willard City will take corrective action to rescind its previous repeal and will implement the collection and distribution to UTA of the 1st Quarter Tax as well as its portion of the 4th Quarter Tax in support of transit operations and projects.
DISCUSSION:
The proposed Interlocal Cooperation Agreement (UTA Contract #26-P00551) establishes a long-term funding partnership between UTA and Willard City. Under the agreement, Willard City will facilitate and direct the transfer of the 1st Quarter Tax and its portion of the 4th Quarter Tax due to UTA from the Utah State Tax Commission.
The proposed agreement also acknowledges Willard City’s repeal of 2nd Quarter Tax through the adoption of Ordinance 2024-04 on April 11, 2024. In addition, the agreement provides for the termination of the 2008 Interlocal, and releases both parties from any remaining obligations under that agreement.
The proposed agreement also releases the parties from any claims or losses from the enactment, repeal, and reinstatement of the 1st Quarter Tax.
Approval and execution of this proposed Interlocal Cooperation Agreement, will renew the cooperative funding framework between UTA and Willard City and support the continued provision of transit services and transit related projects.
ALTERNATIVES:
Decline approval, which would prevent UTA from receiving the designated tax revenues and delay or limit transit operations in Willard City.
CONTRACT SUMMARY:
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Contractor Name |
Willard City |
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Contract Number |
26-P00551 |
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Contract Start/End Dates |
Effective from date of last signature - December 15, 2044 |
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Total Contract Value |
NA |
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Procurement Method |
ILA |
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Budget Authority |
NA |
FISCAL IMPACT:
The Interlocal Cooperation Agreement provides UTA with a dedicated and ongoing revenue source through the transfer of Willard City’s 1st Quarter Sales and Use Tax and the City’s portion of the 4th Quarter Tax. These revenues will support capital construction, operations, and maintenance of transit projects and are pledged toward bonds or other financial obligations of UTA.
ATTACHMENTS:
• R2026-04-04 - Resolution Authorizing ILA with Willard City (including ILA as exhibit A)