Millcreek property owners who get water from Salt Lake City could face a new tax to help cover $600 million in utility debt the city cannot pay off under its current financial structure.

A 51-page state audit released Wednesday, Sept. 16, found that Salt Lake City's Department of Public Utilities (SLCDPU) has borrowed heavily for water and sewer upgrades without a feasible repayment strategy. The Utah Legislative Auditor General recommended the city consider a dedicated property tax or a special taxing district. Because Millcreek residents and businesses depend on SLCDPU for water service, either option could mean higher costs for local property owners.

That matters here. A majority of Millcreek's culinary water comes from SLCDPU and Jordan Valley Water Conservancy District, according to a December 2025 Millcreek staff report. Five separate providers serve the city. Millcreek manages none of them.

The debt centers on an $850 million overhaul of Salt Lake City's 55-year-old Water Reclamation Plant in Rose Park, nearing completion. The rebuild was required to meet federal limits on pollutants like phosphorus in water returned to the Great Salt Lake, according to the city and the U.S. Environmental Protection Agency. Auditors found the department is already operating in the red on debt payments and concluded its current structure will soon be unable to cover upcoming costs or additional borrowing.

At the Sept. 16 hearing on Capitol Hill, Utah House Speaker Mike Schultz, a Hooper Republican, blamed city officials for piling up debt after years of deferred maintenance.

"Those are big numbers, and it sounds like fees are already through the roof inside Salt Lake City," Schultz said. "Affordability is top of mind right now for every resident, not just in Utah, but across the country."

Public Utilities Director Laura Briefer generally agreed with the audit's findings. She said the city has begun preparing an updated long-term financial plan and a deeper study of utility rates, set for completion next summer. She described the upgrades as long-deferred investments the city is trying to tackle responsibly.

The audit's recommendation to create a special taxing district could remove utility finances from the mayor and city council's control, placing them under an independent entity. Rachel Otto, Mayor Erin Mendenhall's chief of staff, pushed back on that idea in the city's written response, arguing existing oversight can provide sufficient financial stability.

Millcreek has no direct say in Salt Lake City's utility decisions. The Mount Olympus Community Council flagged that gap in December 2025, recommending that Millcreek staff work more closely with SLCDPU to influence water policy on behalf of residents who rely on the service. No Millcreek city official has commented publicly on the audit.

Salt Lake City's updated financial plan and rate study are set for completion next summer. Millcreek residents who want to weigh in on water policy can contact Millcreek City Council members or attend upcoming council meetings listed at millcreekut.gov.