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HomeMy WebLinkAboutCouncil Provided Information - 5/12/2026CITY COUNCIL OF SALT LAKE CITY 451 SOUTH STATE STREET, ROOM 304 P.O. BOX 145476, SALT LAKE CITY, UTAH 84114-5476 SLC.GOV/COUNCIL TEL 801-535-7600 FAX 801-535-7651 BOARD STAFF REPORT COMMUNITY REINVESTMENT AGENCY of SALT LAKE CITY TO:CRA Board Members FROM:Kate Werrett Budget and Policy Analyst DATE:May 12, 2026 RE:CRA BUDGET AMENDMENT NO. 3 FOR FISCAL YEAR 2025-26 ________________________________________________________________________________ ISSUE AT-A-GLANCE The CRA FY2026 Budget Amendment Number 3 includes the final annual tax increment payments from Salt Lake County, increases in associated obligations, interest revenue, loan payment adjustments, and an accounting adjustment related to the Salt Lake City Library. Goal of the briefing: Review the FY2026 CRA Budget Amendment 3 and set the public hearing date. POLICY QUESTIONS 1. The CRA Board may wish to discuss what is driving the increases in tax increment collection: new growth, valuation changes, collection rates, or something else? ADDITIONAL & BACKGROUND INFORMATION The annual budget uses a conservative forecasting of property tax increment, resulting in a fiscal year end “true-up” budget amendment to recognize and adjust budgets based on actual tax increment revenues. Obligatory and discretionary expenditure amendments are proposed to reflect the final annual tax increment payment and additional interest revenue. The attached CRA transmittal details the adjustments to budgets based on the actual property tax increment received to satisfy obligations under state law, interlocal agreements with other taxing entities, reimbursement agreements with private property owners, and additional funding for agency operations. The budget amendment memo also addresses an additional $1.6 million in interest revenue and a $2.3 million accounting adjustment. Key items addressed in this budget amendment include: Property Tax Increment Collection: $8.8 million above budget Taxing Entity Payments: $1.2 million above budget Interest Revenue: $1.6 million above budget $1.4 million increase in combined loan principal and interest payments $2.3 million accounting adjustment associated with Salt Lake City Library property tax revenue Schedule: Page | 2 In alignment with the FY2023 Legislative Intent, this is the third year using transition holding accounts to manage revenues above what was included in the approved budget. The additional FY2026 revenue will be allocated in the FY2027 budget, totaling $7,875,050. The attached CRA transmittal includes details of these key changes: Revenues. Interest Revenue: A $4.8 million increase in interest revenue over the budgeted amount. State Street Tax Increment: The FY2026 State Street project area tax increment was $2,339,880 more than the budgeted amount. In FY2025, Salt Lake County did not disburse the County's TY2024 tax increment for the State Street Project Area. Per the interlocal agreement, TY2024 was the first year of the County tax increment. The CRA has included the TY2024 increment in the FY2026 budget. Central Business District Tax Increment: For FY2026, the Central Business District project area tax increment was $2,051,070 more than budgeted. In FY2025, the Central Business District project area tax increment was $2,378,301 less than budgeted. Northwest Quadrant Tax Increment: The Northwest Quadrant project area tax increment was $961,687 more than budgeted. Project Area Collection: An $8.8 million increase over the budgeted amount. Expenses Proportional Expense Amendments: Within budget amendment #3, in alignment with the actual tax increment, changes to obligated expenses as required by statutory or contractual obligations and CRA operations are proposed. Other Salt Lake City Library Property Tax: The budget amendment addresses a $2.3 million accounting adjustment associated with Salt Lake City Library property tax revenue. CBD Primary Housing Funds: The budget amendment transfers CBD Primary Housing Funds to the Secondary Housing Funds to provide funding for citywide affordable housing. Project Area Expiration Dates Project Area Initial Collection Year Last Collection Year FY25 Budget Change FY25 BA #2 NOTE: Only project areas that generate tax increment are listed in the table. *The CRA Board extended the CBD from the original expiration year of 2007 †In October 2021 the Board approved two-year extensions for these project areas. State law was changed to allow extensions for projects areas negatively impacted by the COVID-19 pandemic ATTACHMENTS