Cities, counties keep their power, funds intact

After fending off fiscal and control challenges for 45 days, cities and counties survived the 2004 Legislature with most of their infrastructure and power intact.

Before the session even started, a proposal by Gov. Olene Walker to take $27 million in road and water money from local governments to fund a reading program had municipal and county leaders on the defensive. But as the session closed, cities and counties had not lost any of their road or water money, a funding priority which even legislative leaders acknowledged.

"We have gone through a difficult budget . . . without touching the water or road funds," said Senate President Al Mansell, R-Sandy. "We feel this is important to the people of Utah and the economic growth of the state."

While watching their wallets, cities and counties struggled with state leaders over which services they should be providing and whether they can invest their tax revenue into telecommunications projects. They even got into a tug-of-war with each other over jail funding, and whether a proposed $32 fee on justice court fines should be sent to county general funds.

Seventeen cities were waiting late Wednesday to find out if they would have a potential source of major income — or loss — available to them. As midnight approached, negotiations were still being held between representatives and senators on SB66.

That bill, requiring cities investing in cable, Internet or telephone service to get any bonding approved by a general vote, originally was intended to halt the Utah Telecommunications Open Infrastructure Agency (UTOPIA). But the bill was amended in the House to exempt the UTOPIA cities.

That project would run fiber optic cables throughout all of the participating cities, then allow private providers to lease the cables to provide high-speed Internet service to residents and businesses. To get the $540 million project off the ground, city leaders have agreed to borrow money with the hope they will recoup their investment through lease fees and economic development.

Opponents have argued the cities should put the bonding issue on the ballot, asking their residents for approval instead of allowing city councils to OK the bonds. City leaders, however, have attempted to maintain their autonomy and retain the ability to spend their city funds as they want.

One of the core issues surrounding UTOPIA is a debate about which services local governments should provide. That discussion probably will intensify in years to come, said Ken Bullock, executive director of the League of Cities and Towns.

Along with SB66, the House was still considering SB222 Wednesday night. That bill would require cities to conduct a feasibility study for any project that would compete with a similar private business located within 15 miles.

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