"But if it is believed that these elementary schools will be better managed by...any other general authority of the government, than by the parents within each ward [district], it is a belief against all experience." --Thomas Jefferson

Tuesday, February 1, 2011

Letter to State School Board from ASD parent: Why did you raise taxes $300 million in Alpine School District? (without one cent going to public ed)

It may be possible to readdress the Vineyard URA if one of the parties who voted in favor of the URA is willing to go back to the table within 30 days.  I would ask you to contact the Utah State School Board and Utah County Commissioner, Larry Ellertson and request they take another look at this project from the perspective of the ASD taxpayer. 

In light of that information, and because I agree with the content, I have reprinted this letter (with permission) from a parent in our district to the Utah State School Board about the Vineyard URA. I have included everything as sent with the exception of an image file I am unable to upload to this blog. I have also deleted email addresses, phone etc.  Thanks to Joel Wright for this letter and his information.


Dear Utah State School Board,

Did you know that on January 18, 2011 you raised taxes by $300 million

in Alpine School District?

Did you know that not one cent of that $300 million will go towards

public education?

Most likely you've never heard of this tax increase, and also believe

you never voted for it, but your attorney, Carol Lear, is claiming you

did properly approve and authorize this tax increase because of an

approval Larry Newton received 18 years ago in 1993. (See her email

below as EXHIBIT ONE to this email.)

I will explain the details below. But what I'm really writing to

request is that you reserve 20 minutes at your meeting on February 4,

2011 to get a 10 minute explanation from Larry Shumway and Larry

Newton as to why Larry Newton voted to approve this $300 million tax

increase on January 18, 2011, and also get a 10 minute explanation

from Alpine School District as to why they are absolutely dumbfounded

and horrified by Larry Newton's vote in favor of this tax increase.

In short, here are the undisputed facts:

Anderson Geneva purchased most of the land formerly used by Geneva

Steel in the city of Vineyard on the east coast of Utah Lake in Alpine

School District several years ago.

This land is inarguably "blighted" - meaning the land has extensive

environmental damage that requires remediation before it can be


According to independent evaluations, the cost of cleaning up this

environmental damage is $150 million. No one has produced any

document indicating it will cost more than this amount.

In early 2010, the "Vineyard Urban Redevelopment Agency" (or "Vineyard

URA") was created. The membership of the Vineyard URA consists of the

following members:

1. Two members from Alpine School District (Rob Smith and Guy Fugal)

2. Two members from Utah County (Larry Ellertson and Gary Anderson)

3. Two members from Vineyard City (Nathan Riley and Jim Carter)

4. One member appointed by the Utah State Board of Education (Larry Newton)

5. One member appointed by smaller taxing entities (Dave Pitcher from

Central Utah Water)

(You can see the limited minutes and meetings of this body here:

http://www.vineyard.utah.gov/interior.asp?pageid=3749&offset=0 )

This group met on January 18, 2011, and approved a $300 million

property tax break for the old Geneva site by a vote of 5 to 2 (only

Gary Anderson from Utah County was not present.) Alpine School

District voted against it, and everyone else who was present,

including Larry Newton, voted in favor of it. Because a 2/3 vote was

required to approve the property tax break, any one of the 5 votes

would have stopped it. In other words, Larry Newton's single vote was

enough for it to pass.

Alpine School District was led to believe that Larry Newton would NOT

vote in favor of the property tax break unless Alpine School District

was also willing to vote in favor of it, and was completely shocked by

his vote in favor of it.

I emailed Superintendent Larry Shumway on Monday, January 24, 2011

asking him the following questions, and still have not received a


1. Why did Larry Newton vote in favor of this $300 million property tax break?

2. Why didn't Larry Newton inform Alpine School District that he was

going to vote in favor of the tax break? Why did he have to surprise


3. Did an outside authority (like the Governor) encourage Larry

Shumway or Larry Newton in any way to vote for this tax break? If so,

what were their arguments in favor of it?


At any rate, we are simply mortified by this series of events down

here in Alpine School District, and believe we are at least entitled

to an explanation before we pay an additional $300 million in taxes.

Note also that outside parties like the Utah Taxpayers Association

have reviewed this $300 million tax break, and are completely opposed

to it. To date, everyone opposed to this tax break is willing to talk

at length about why they oppose, but no one who voted in favor of it

is willing to provide any explanation. Furthermore, everyone on both

the right and the left are united in their opposition to this $300

million tax break. This is not a partisan issue.

Please review the materials below, and feel free to call or email me,

or also to call or email anyone at Alpine School District on this very

important matter.

Finally, the most important thing you can do at this point is bring

sunlight to this matter, and schedule twenty minutes to hear from both

sides at your February 4, 2011 meeting. Note that Larry Newton is

already required under Utah Code 17C-1-402(11) to provide a written

explanation as to why he voted in favor of this $300 million tax

break, so it shouldn't require any additional time for him him to

prepare that write up now, and read it to you at your February 4, 2011


I believe the students, teachers and taxpayers of Alpine School

District deserve nothing less.


Joel Wright

Parent of children in Alpine School District

Taxpayer in Alpine School District


1. Exhibit One: Email from Carol Lear dated January 26, 2011,

stating Larry Newton was appointed to the Vineyard URA due to what

appear to be minutes from a 1993 State Board of Education meeting.

Copies of those minutes, as well as a 2001 and 2003 letter, are

attached in PDF.

2. Exhibit Two: Email from Joel Wright to Larry Shumway dated

January 24, 2011, asking Superintendent Shumway to explain Larry

Newton's vote in favor of the Vineyard URA. (No response received as

of January 28, 2011)

3. Exhibit Three: Statement from Alpine School District explaining

their opposition to the $300 million tax break.

4. Exhibit Four: Blog Post from Alpine School District Board Member

Wendy Hart explaining her opposition to the $300 million tax break.

5. Exhibit Five: Blog Post from Alpine School District Board Member

Paula Hill explaining her opposition to the $300 million tax break.

6. Exhibit Six: Editorial by Joel Wright (me) that appeared in the

Daily Herald in July 2010 expressing opposition to the $300 million

tax break.

7. Exhibit Seven: Blog Post from Community Activist Oak Norton

applauding Alpine School District's opposition to the $300 million tax


EXHIBITS (below):


materials attached in PDF):

---------- Forwarded message ----------

From: Lear, Carol

Date: Wed, Jan 26, 2011 at 5:35 PM

Subject: FW: Scan from a Xerox WorkCentre

To: Joel Wright
Cc: "Hauber, Todd"

Joel--I have two statements, signed by the former State Board Chair,

appointing Larry Newton (Taxing Committee Member) and Cathy Dudley

(alternate Taxing Committee Member). I also have two pages which look

like they are from minutes of a State Board agenda, dated July 14,

1993. I would like clarification that these 2 pages are, indeed,

Board minutes before I say that they are! The Board Secretary is gone

for the day. Even so, given the urgency of your request, I will scan

and email the pages. We haven't yet found a copy of an Agenda

identifying the specific "appointment." But those appointments or

assignments were more informal then; I will follow up tomorrow with an

agenda item (if there was one) during which the assignment took place.

Carol Lear, Records Officer

Utah State Office of Education


24, 2011 (still no response received)

On Mon, Jan 24, 2011 at 10:37 AM, Joel Wright wrote:

> Superintendent Shumway,

> As I believe you are aware, on January 18, 2011 the USOE's representative on

> the Vineyard RDA voted to approve a $300 million tax break for the next 35

> years. This is the largest such tax break in the history of Utah, and has a

> number of long term consequences for Alpine School District, where I live

> and have children attending school.

> As I believe you are also aware, the USOE's single vote determined the

> outcome. A two-thirds majority was required for approval, and it passed by

> a vote of 5-2. Had the USOE voted against, it would have failed.

> Because of that, I would be grateful if you could provide me with the

> following information:

> 1. Written explanation of why the USOE voted in favor of the Vineyard RDA.

> When doing so, we would be grateful if you could specifically respond to

> the reasons why the Alpine School District is opposed to the current form of

> the Vineyard RDA here:

> http://www.heraldextra.com/article_7e8bbe7e-25a7-11e0-9839-001cc4c002e0.html In

> addition, further reasons why one individual board member of the Alpine

> School Board is opposed to the current form of the Vineyard RDA can be found

> here:

> http://wendy4asd.blogspot.com/2011/01/why-your-property-taxes-are-going-up.html

> 2. Why did you "surprise" Alpine School District with your vote?

> Historically, the State Office of Education has always voted with the

> School District on an RDA. Everything Alpine School District had heard from

> you until the vote on January 18, 2011 led them to believe that you would

> still vote against the RDA. Had you informed Alpine School District you

> were going to vote in favor of it, they could have used their vast network

> to contact the Utah County Commissioners and encouraged them to vote

> against. Maybe they should have been doing that anyway, but they are

> currently feeling like they were very much "surprised" by your sudden vote

> in favor of the RDA without any prior warning.

> 3. Did Governor Herbert, or anyone representing the Governor, or anyone

> from one of the Governor's offices, contact you or anyone at USOE before the

> vote on January 18, 2011 and encourage you to vote in favor of the Vineyard

> RDA? If so, can you please share with us who it was, and a summary of the

> reasons they gave to you to vote for the Vineyard RDA?

> Many Thanks,

> Joel Wright

> Taxpayer and Parent in Alpine School District





Alpine School District releases statement on Vineyard tax breaks

Posted: Friday, January 21, 2011 2:40 pm

Alpine School District officials on Friday released the following

statement about the recent approval of $300 million in tax breaks for

Vineyard development:

"Alpine School District did not vote in favor of the Vineyard URA.

District officials are members of the Taxing Entity Committee (TEC)

that voted in a meeting on January 18, 2011, where Alpine School

District voted no to approving the Vineyard URA. The voting members of

the committee were: Vineyard City (2 votes), Utah County (2 votes),

Alpine School District (2 votes), the State School Board (1 vote), and

one representing all other taxing entities (1 vote). There were seven

of the eight members present for the vote. Five voted in favor of

passing the URA, 2 votes - both from Alpine School District - voted

against the URA.

Alpine School District officials had three major concerns with the

original URA proposal:

The length of time - 40 years.

The 400 + acres of residential included in the plan. The taxes on the

homes do not pay for the full cost of the educational services.

The base year used for tax increment calculation was 2006. This was

based on Legislation originally proposed and passed by Senator Curt

Bramble in 2008. The concern that ASD has is that this will negatively

impact all tax payers in Alpine School District.

Members of the URA Proposal Committee met with the ASD Board of

Education in a study session on January 11. The length of time for the

URA had been decreased from 40 years to 35 years. Additionally, there

was discussion about mitigation payment, however, an updated proposal

that included the details about the mitigation was not presented.

A vote was taken one week later. ASD officials continued to vote

against the proposal. With a five out of seven vote in favor of the

proposal, it did pass. Despite the opposition of Alpine School

District officials, we will continue to move forward in working with

our community."




Why Your Property Taxes are Going Up: Vineyard URA

If you live in the Alpine School District, your property taxes are

going to go up. Due to the recent passage of the Vineyard Urban

Redevelopment Agency (URA) project, the county will automatically

adjust the tax rates and increase your property taxes and mine. The

question was whether a commercial entity should receive tax breaks for

the next 35 years in exchange for developing a blighted property.

This may be a good idea for the people of Vineyard, the developer and,

possibly, the state of Utah, but it is a bad idea for the taxpayers of


First, let me give you some background. There are two types of

development projects CDA's (Community Development Agencies, like Adobe

or Micron) and URA's (like Geneva). The main difference is a URA must

develop a blighted area; whereas, a CDA does not. A URA allows a

development group to not pay their normal tax rate (above a certain

threshhold, for a specific time period) and instead use that money to

develop their property. A committee (TEC) of all the taxing entities

(City, County, School District, State Office of Education, etc.) is

formed, and must agree to the proposal by a 2/3 majority. In theory,

we give tax breaks to a development group to improve an area in the

short term, with an increase in taxable value and community and

economic improvement as the long-term gain.

The Vineyard URA comprises the former Geneva Steel property. It

includes areas that are contaminated and structures that would be

costly to remove. The developer has said without the URA monies, they

would simply have to fence about 700 contaminated acres and leave it

alone. Some local legislators feel that without this money, we would

have a big eyesore for decades. The developers and city of Vineyard

agree. But it is a gamble as to whether or not, in 35 years, that

property would be developed. In short, is this a necessary process to

clean-up the former Geneva property, and allow everyone to eventually


Whenever I am faced with a decision, I try to decide which principles

apply. For me, government has no place picking winners and losers in

commercial activities. Some people's politics may allow for government

to be involved in commercial development. Mine, do not. If we give

tax breaks to one group of taxpayers, why not to all the taxpayers?

Having said that, we are forced, by law, to be involved. So, from a

pragmatic point of view, I need to find the best benefit I can to both

the schools of the district and to you, the taxpayers.

Here's how it works. Let's assume the property is worth $1 million

and ASD gets 1% in property taxes, or $10,000/year. With the URA, ASD

will still get their 1% every year of the URA from the developer. But

if in 2 years, the property value increases to $10 million, ASD gets

$10,000 but the developer retains $90,000 to reinvest in development

of the property, and so on. At the end of the URA period, say the

property is worth $1 Billion, then ASD would get their 1% or $10

Million. Every year after that, the property is treated the same as

any other property for tax purposes.

The school board felt this URA was a bad idea for the following

reasons. (Read the official response here.)

First, the state legislature mandated that instead of using current

property value, the URA had to use the property value from 2006. Why

is that important? Because the Geneva property value has gone up. By

using the 2006 value, the legislature gave this developer a greater

tax break. The consequence is that everybody else in the Alpine

School District must now pay higher taxes to make up the difference.

We were told that part of the reason for the 2006 base year was to

allow the developer to have 'seed money' for the development. If the

base year were not set by law to 2006, there would be no additional

burden on the taxpayers. It would just be additional revenues that

would be forfeited.

Second, 35 years is a long time. No one can predict what will occur

over the next 35 years. ASD is growing and has needs right now. Do

we honestly think the greatest demand for that property's revenue

won't be for 35 years in the future? Children who are being born now,

will have graduated from ASD schools, and be sending their kids to

those same schools before the benefit of this project will appear. It

is projected that ASD will lose a total of $200M in revenue over the

35 years. A Daily Herald article says ASD will receive $16

million/year from the Geneva site after the 35 years. $200 M lost /

$16 M year = 12 years to make up the lost revenue after year 35.

Third, the URA includes residential areas. These residences will have

children who will attend school in ASD. Even though ASD will not

receive any funds for those children, ASD will need to accommodate

them in district schools.

Finally, ASD had two independent financial consultants and the Utah

Taxpayers Association run the numbers. All three said the total

amount, length of time and rollback of the base year prevented them

from recommending that ASD sign on to this project. A representative

from the Taxpayers Association said it would cost $150 million to

remove the blight. This would allow the developer to correct the

problem areas, leaving them with usable property. Remember, the URA

was for $300 million. The tax payers are financing $150 million of the

actual development instead of simply making the property usable.

(For a good article on reclaiming the blight, but not subsidizing the

development, go here.)

ASD's two members on the TEC voted against the URA. The two reps from

Vineyard City, one of two from Utah County (one didn't show), one from

the Utah State Board of Education, and the member representing all the

other misc taxing agencies voted in favor of the proposal. As such,

ASD's taxpayers are obligated to go along. (Incidentally, an article

in the Daily Herald incorrectly implied ASD was in favor of the


If you agree this is a good proposal, then you need to do nothing. If

you disagree, you need to contact your legislators and share this

information with your neighbors.

From the legislation, it appears that a resident of Vineyard City can

appeal this URA decision. Do you know anyone who lives in Vineyard

City? I think this decision should be appealed.

Also, there is proposed legislation this session rolling back the

URA/CDA approval process from 2/3 majority to a simple majority. This

bill would result in even more unfair situations similar to the Geneva

property. ASD would be forced to participate in more URAs at the

additional cost burden to the average resident. I would recommend you

contact your legislators to oppose this legislation. They need to

understand the current situation in which you can be taxed without

your consent and without an appeals process.

To me this is a case of government redistributing your tax dollars.

ASD, or rather you and I and our schools, will be on the hook for many

of the 'tax breaks' over this period of time. My question to you is

"Will it be worth it?"

*Sen. Curt Bramble, a proponent of this project, authored legislation

that changed how CDA's and URA's operated. For the most part, I agree

with the legislation. It changed the approval process from a simple

majority to a 2/3 majority and gave the school districts more autonomy

and say. It also greatly limited the definition of a blighted area.

In the past, a broken fence or a dead tree limb could be construed as

blight. For a URA, all taxing entities must participate. For a CDA,

taxing entities must opt in to participate (Rep. John Dougall's

legislation); they are excluded by default from CDA projects. What I

disagree with is additional legislation (Bramble) setting the base tax

year for this particular project to 2006 (one year after the site was





About the Vineyard URA, or tax benefit to develop the old Geneva

property, the short answer to your questions is that we got skunked.

The Board and the District agreed that the demands were too stiff, and

both sides were maneuvering for the best terms. We worked with a

committee from Utah County, the town of Geneva, Alpine School

District, the Utah State Office of Education, a representative of all

other taxing entities such as the water district, and an at-large

member. Three votes would stop it, and we felt confident that ASD and

the USOE member held a strong hand.

Oops. They called a vote, the USOE voted in favor, and it was suddenly

all over.

The longer answer, although not very technical, is that the developer

needed tax breaks to be able to accomplish the massive clean-up and

build the ambitious commercial/residential design sitting on the

drawing board. The proposal was exciting and attractive, but the

concessions asked were pretty generous. In particular Alpine School

District was resisting the unheard of length of time, 40 years, and

the residential component, where property taxes from the 2300 housing

units projected would be reinvested with the development while the

district would still be required to educate the children from those


The third problem was the roll-back, or using the tax base from 2006,

before the power plant was built, when the property was worth

considerably less. Representative Curt Bramble, Provo, passed a bill

rolling back the tax rate for the property, which had the effect of

raising the tax rate on the entire district. Now that the

redevelopment is moving forward, watch for your next tax bill to

reflect a $15-17 increase for the average household for a private

developer to make big money improving the town of Geneva with your tax


Anderson Development had scaled back to 35 years (that’s still two

generations of school children) and was preparing other mitigations

when the bargaining was suddenly all over. While this is certainly

political, it seems that each party was doing his job in representing

the interests of those they worked with. We will all enjoy driving

along I-15 and seeing a charming little development in place of

blight. But I do not understand the roll-back, nor the USOE abandoning


I wrote earlier about seeing two columns, one for what we get and one

for what we give. The money guys have done this, and the conservative

estimate is that this deal will immediately cost ASD $30 million. Boo,




Developers frequently ask school districts to assist in the

redevelopment of land. The developer typically asks the school

district to provide property tax rebates to the developer's project,

which decreases the costs of the project, making it more economically

feasible (or profitable). The justification given for the tax rebate

is that the project will generate more tax revenue in the future for

the school district, so the school district should "invest" in the

project by giving the developer a tax rebate.

Possibly the largest such tax rebate in the history of Utah ($300

million) has recently been requested from Alpine School District by

Anderson Development through the town of Vineyard for the proposed

redevelopment of the old Geneva Steel site. Based on my read of the

Utah Taxpayers Association's review of the request, I believe the

Alpine School Board should support approximately half of the proposed

$300 million rebate through a redevelopment agency (or "RDA"), but the

second half is not justified and should be rejected by the Alpine

School Board.

When evaluating a proposed redevelopment project, school boards should

ask two questions. First, does the land have negative value? That is,

would a developer have to pay someone to transfer ownership in the

property? If the answer to that question is, "Yes," then an RDA may be


The second question is this: if the RDA is not approved, will the

transactions on the redeveloped site take place in the greater

community? If the answer to this question is, "No," an RDA can also be

appropriate. Unlike most RDAs, the Geneva RDA has elements relating to

both questions.

The former Geneva site is riddled with useless infrastructure, from

deep concrete bunkers to tainted dirt. These relics of the steel plant

have imposed negative value on the property. Based on Anderson

Development's projections, about $150 million worth of the

improvements contemplated in this RDA are necessary to bring the site

to a condition comparable to other greenfield sites. That much of the

proposed RDA is appropriate, and should be approved. Without such

approval, the land could remain any eyesore for generations to come,

and harm the economic development of Utah County.

But Anderson Development is apparently not content with that level of

taxpayer investment. They want the Alpine School Board and other

taxing entities to grant another $150 million in taxpayer subsidies

for their project. This additional investment by the taxpayer is not

justified because the transactions contemplated by that investment

will occur in the greater community, whether or not this Geneva RDA is


Over the 40-year term of this RDA, Anderson Development hopes to build

office parks, retail space and housing. Whether labeled as

residential, office space or storefront, all the development

contemplated in this portion of the Geneva RDA is retail. Tax

subsidies do not stimulate retail economic activity; rather, they

rearrange which city reaps the sales taxes associated with the retail


If the Alpine School Board participates in the second $150 million of

the Geneva RDA, the district will get nothing in return. Consumers

won't increase their spending because of the new retail location.

Every transaction in the proposed Geneva RDA will occur somewhere in

the greater community without that subsidy. The transactions may be in

Lehi or Orem, but they will occur. In other words, if the Alpine

School Board approves the second $150 million request, they will

essentially be shifting millions of dollars from existing cities and

businesses in the Alpine School District to the city of Vineyard and

Anderson Development. So, while this request clearly makes sense for

both Vineyard and Anderson Development, it does not make sense for all

the other cities and businesses in the district.

The plight of the Cottonwood Mall illustrates the folly of retail RDAs

like the second half of the Geneva RDA. Almost two years ago, the

Granite School Board approved an RDA to subsidize the redevelopment of

the Cottonwood Mall. The Cottonwood Mall proposal would have used

nearly $100 million over 20 years to facilitate retail, office space

and residential units.

Although the subsidies were approved, no redevelopment of the

Cottonwood Mall has taken place. The reason for the failure is simple:

tax subsidies do not change the amount of consumer spending. They

merely move an economic transaction from one place to another. They

spur no new economic activity.

In summary, the Alpine School Board should separate the proposed

Geneva RDA into two $150 million pieces. The piece that eliminates the

site's negative value is appropriate, and the Alpine School Board

should participate. The second piece, which subsidizes economic

activity that would happen without the subsidy, is inappropriate, and

the School Board should reject it.

• Joel Wright, of Cedar Hills, is an attorney.

EXHIBIT SEVEN - blog post from Oak Norton:


KUDOS to ASD’s Board

January 26th, 2011

To the Alpine School District Board,

I know we periodically find ourselves at odds but I am very pleased to

find us on the same side in the issue of the Vineyard Urban

Redevelopment Agency. I understand that in the recent vote, your

position was outvoted by others who would financially benefit by the

arrangement. I also understand that taxpayers within the school

district will be on the hook for a couple hundred million dollars over

the next 35 years. This is the classic case of democratic majority

rule where 2 wolves and a sheep vote on what to have for dinner. The

rest of the committee appears to benefit by saddling the rest of the

district taxpayers with their development. I was quite surprised to

hear that the representative from the state office of education didn’t

vote with the school district. That seems quite odd and opens up

questions into how they arrived at their position.

Short of a successful legal challenge, there may not be a lot that can

be done to prevent this injustice. However, I would like to suggest

something for your consideration.

Vineyard voted to pass their hundreds of millions of dollars of

development costs and developer tax breaks on to the school district

taxpayers’ while we continue to pay for their children to be educated.

It seems appropriate to return the favor and publicly announce that at

your next board meeting you will be discussing the possibility of

splitting Vineyard off as a separate school district. This doesn’t

have to be a serious consideration, just a warning shot across the bow

that help Vineyard realize they’re affecting the lives of many

citizens outside their town. Taxation without proportional

representation has a downside when others choose to dissociate

themselves from them.

The County may have *some* limited responsibility to clean up the site

but giving massive tax breaks to the developer after that is entirely


Taxpayers aren’t going to be excited about cleaning up Vineyard,

giving massive tax breaks to a developer, and paying for a brand new

bond in ASD. Thank you for standing for fiscal responsibility and not

taking important future revenue from the ASD.


Oak Norton, Utah’s Republic


1 comment:

  1. Excellent! I just checked the State Board website to see if their Feb 4th agenda included an explanation by Newton and Shumway.

    It wasn't listed so I called and was told that they will be presenting. It will be under Superintendants' report (maybe the agenda hasn't been updated yet).

    I hope to watch via the live webcast they offer: http://www.schools.utah.gov/main/CALENDAR.aspx