A group of Vineyard citizens is launching a referendum effort to overturn a resolution authorized by the Vineyard City Council to issue a sales tax bond to construct a new city center in the Utah City development.

The council passed the bond’s issuance in a 4-1 vote at an April 3 special session under the stipulation that the city will hold a later public hearing on the bond and that the issue would be expanded for discussion and action by the council before the bond is sold.

Specific bond numbers are not finalized, but LRB Public Finance Advisors, the city’s fiduciary that presented the resolution, said the bond would not be more than $35 million and would have an interest rate no higher than 6% with no more than a 30-year payment length, though they estimated the final figures would be lower.

The city also has a partnership with the Mountainland Association of Governments, who will pay for a portion of the building, and the city anticipates it will make revenue from leasing out extra building space.

The referendum was issued on April 7 by citizens who felt the council passed the bond without proper transparency and that the decision lacked financial responsibility. In an issued release, the group claimed the annual payments of a sales tax bond would range from $920,000 to $1.7 million, which they said was nearly half of Vineyard’s annual sales tax revenue.

Per Utah law, the referendum effort will have 45 days to gather signatures. Approximately 700 signatures are needed to push the issue onto the November ballot.

“For months they’ve been saying, ‘Hey, we’re going to have all these town halls and forums talking about the bond, whether we can pay for it,'” referendum co-signer and Vineyard resident Jacob Wood told the Daily Herald. “But then the mayor put it on the agenda, the actual bond, and then a couple City Council members were like, ‘Oh we don’t have all the details yet.’ But then, like, two minutes later they passed it.”

Wood also doubts the city has the financial reserves necessary to fund the bond payments and believes taxes will ultimately have to be raised to finance the bond.

In response to to the referendum, Mayor Julie Fullmer and council members Mardi Sifuentes, Sara Cameron and Brett Clawson issued a joint statement saying the project is a cumulation of “years of public process and extensive planning,” and added the financial analysis confirms the city’s safe financial position and that the bond will not increase property or sales tax.

“We are concerned that the efforts of a small, vocal minority to mislead the public and push for a referendum on this will be a waste of city resources and taxpayer dollars and will ultimately cost the city much more in the future and sacrifice the City’s ability to deliver day-to-day services to our growing community,” the release said.

Financing the city center

Vineyard has grown from a population of below 200 people in 2012 to over 15,000 in 2025.

Clawson acknowledged that rapid growth can come with some challenges, and said the question is, “How do we manage that and allow ourselves the flexibility to grow into it as all the additional development and growth continues to happen?” he said.

Determining whether to build a new city hall reflects this struggle.

A new building is necessary, Clawson said, because the current city hall has roughly 140 square feet per employee, including the council chambers, and that one area designed for a single occupant is used by three employees. Space reserved for a printer, he added, has been converted into an office, yet the printer is still in the room.

Wood said his side isn’t against the new city hall, but argues the city can’t afford a $35 million bond payment, although Clawson believes that figure will be lower.

A sentiment from many against the new city hall is that the city is cash-strapped.

Councilman Jacob Holdaway told the Daily Herald last November that Vineyard’s tax base all shops in Orem, making it difficult to raise money through sales tax. He claimed it took the city a decade to save $1.4 million to build a fire station, yet anticipated a bond payment for a city hall would be a similar amount annually for multiple decades.

“Why would we have the ability, with our tax base, to be able to do that in perpetuity for 20 years? This is so financially off,” Holdaway said at the time.

Clawson believes the bond makes financial sense for the city, though, and said the bondholder is capable of making a strong evaluation of whether a bond is worth investing in.

“What it really comes down to is, what is the current amount of sales tax that the city is recognizing, and what does the growth rate of that look like?” he said. “In between those two things, you can forecast with some variability, whether or not the amount that we’re asking for in a bond is affordable, and whether or not the city can actually pay for it.”

Clawson added that LRB presented some “worse-case scenario” numbers of what sales tax growth may be and how the city would pay for the bond during a February council meeting, and that the project was still doable.

Those numbers predicted “a significantly lower rate of sales tax growth than we actually realized over the last five years,” Clawson said, “and it was still quite affordable looking at those rough numbers.”

What now?

When the City Council voted to initiate the bond’s issuance they stipulated the city will go into deeper financial analysis of it at a May 14 public meeting.

However, Holdaway, who is not a co-signer of the referendum but voted against the bond, claims the city will not be able to go through with that process now that the referendum has been filed.

“Now that the signatures are in, all the work on the bond is supposed to be stopped, so the bond people aren’t allowed to come and do a city council meeting,” Holdaway said. “They can’t do any further work. They can’t do any further studies, because the referendum has already been filed, so no information is going to come out anymore.”

Utah Code on campaign and financial reporting states public entity’s may not do the following:

• Make an expenditure from public funds for political purposes, to influence a ballot proposition, or to influence a proposed initiative or proposed referendum.
• Publish on the public entity’s website an argument for or against a ballot proposition, a proposed initiative, or a proposed referendum.

Clawson said his interpretation of the code is that the referendum prohibits the city from advocating for or against the referendum, but is not a prohibition on “information collected by or presented by the city.”