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07/19/25 UPDATE:
The $1.7 M figure included in the 06/24/25 press release for the yet-to-be-approved FY26 budgeted R.O.W. interfund fee revenue was based on a "recommended" number from the revenue forecast presented in the 05/15/25 meeting. https://agenda.pocatello.gov/resources/FY2026/revenue.pdf
The budget was approved to be published on 07/10/25 and per a public record request for the DRAFT budget, the "budgeted" revenues from these same R.O.W. fees were lowered from $1,757,510 to $1,500,861. This revenue number remains higher than what was planned for in their 2024 5-Year Rate Study.
NOTE: No court has ruled on the compliance of the current Pocatello R.O.W. fees. P.A.G.E. suggested the City Council obtain an opinion from the AG's office or other unbiased source and make it public.
Pocatello for Accountable Government Entities (P.A.G.E.)
Press Release
Pocatello Utility Fee Scheme 2.0
Pocatello, Idaho. 6/24/2025 — Based on a lengthy investigation, Pocatello for Accountable Government Entities (P.A.G.E.) has concluded that, for the past 10 1/2 years, City of Pocatello utility users were taxed over $11.5 M in disguised tax fees.
Pocatello residents will recall the utility fee lawsuits of 2012-2019 which ultimately resulted in the ruling that the City’s PILOT tax and fee scheme was unlawful and unconstitutional followed by a class-action lawsuit for which the plaintiffs were awarded a $4.5 million judgment in repayment to the utility users for two (2) of the nearly ten (10) years that taxpayers were overcharged.
Months after a 11/15/2013 injunction ordered Pocatello to cease collection of the PILOT fee, rather than make all the necessary adjustments to offset the resulting $2.2M deficit, the city very quietly (based on the lack of fee implementation documentation in public records), reincarnated a new version of fees and began collection of new “disguised tax” fee revenue in October 2014.
The facts of the new disguised tax fee scheme differ from the older unlawful PILOT fees in an attempt to obscure and legitimize the fees. The new scheme generated disguised tax fee revenue by adding new budget line items called "right-of-way" (ROW) maintenance fees to expenditure budgets of the three Enterprise Departments: Sanitation, Water, and WPC described as maintenance fees which serve to provide reimbursement to the Street Fund for the wear-and-tear to local streets caused by utility department vehicles.
However, it is apparent, the "Right-of-Way" (ROW) fees violate the same principles and laws as the PILOT fees did and Pocatello’s other unlawful street maintenance fees from their 1988 lawsuit, Brewster v. City of Pocatello.
More recently, our view was affirmed by the 12/07/2021 Bradbury v. City of Lewiston court decision, challenging a nearly identical utility fee scheme. It is apparent, the City of Lewiston never appealed this specific part of the decision due to the clear historic court precedent which should have served to deter these fees. After other challenges within that same case were decided by the Idaho Supreme Court in July 2023, the City of Moscow, self-corrected mid-budget year to remove their unlawful utility fees and restore compliance with the Idaho State Constitution. The City of Pocatello has disregarded the 2021 court decision and continues in its collection of these disguised taxes.
P.A.G.E. calls upon the Pocatello City Council to take immediate action to cease collection of these unconstitutional fees and to remove this $1.7M+ in budgeted ROW revenue from the proposed FY2026 budget. This is the only honest, ethical, and lawful path forward. Our elected representatives' implementation of these fees in 2014 and subsequent councils' failure to identify the apparent unlawful and arbitrary nature of the (disguised tax) fees has placed the City at high risk of yet another lengthy and costly "regulatory taking" lawsuit of which our citizens and city employees will bear the cost and burden. This betrayal of trust and abuse of authority deepens the divide and distrust local citizens have in City of Pocatello elected government.
NOTE: The budgeted FY2026 ROW fees were adjusted to $1,500,861.
VIDEO CLIP: City of Lewiston Council member John Bradbury from August 24, 2020 City Council Meeting.
SUMMARY: Councilman Bradbury (an attorney and former judge) attempted to persuade his fellow council members to withdraw the revenue from the City of Lewiston's FY21 budget he alleged was unconstitutional disguised taxes (street impact fees) being collected through their Enterprise funds. He also argued for payback of some loans from their Enterprise funds.
His pleas were disregarded by his fellow council members. As Bradbury explained in the longer clip linked below, he took an oath to uphold the Federal and Idaho Constitution (and Idaho/City laws) and he felt compelled that he would need to do what he could to stop the fees because he believed the City of Lewiston's Street Impact Fees were disguised tax fees (unconstitutional). He filed a lawsuit against the City of Lewiston.
Simply stated - as a representative of the People, his principles required him to put the People's interests above those of the City in order to adhere to what he believed to be lawful.
Ultimately, he lost on a majority of his claims related to the loans (in our opinion, largely due to a lack of accounting evidence). However, he prevailed on the matter of the street impact fees.
It is our view, the City's R.O.W. fees are equivalent to the City of Lewiston's Street Impact fees and should be eliminated.
SOURCE of CLIP:
IDAHO LAWSUITS/CASE LAW
Click on the Headings to Download a PDF of the Document
" The street impact fees taken from Sanitation Fund and Wastewater Fund are an unauthorized tax for street repairs. The City has attempted to show that the street impact fees are rationally related to the cost of providing sanitation, wastewater, and water, but the City cannot establish the specific cost to each ratepayer for their impact on the street." pg. 18
"The street impact fees at issue here are akin to the maintenance fees addressed in Brewster and the PILOT fees from
Hill-Vu." pg. 20
"For a fee to be considered incidental to regulation, funds generated thereby must bear some reasonable relationship to the cost of enforcing the regulation." Brewster (1988) as quoted in Hill-Vu (2017), pg. 5
"If the regulatory fee does not bear a reasonable relationship to the cost of enforcing a regulation, it is considered as being a tax."
Cited source: Brewster (1988) as quoted in Hill-Vu (2017), pg. 5
"For a fee to be for water and sewer services provided by the municipality that is subject to the Revenue Bond Act, as in this case, “the services of such works shall be furnished at the lowest possible cost.” I.C. § 50-1028. If fees are collected under the disguise of the [Revenue Bond] Act and allocated and spent otherwise, then the fees are primarily revenue raising and will be construed as taxes." Loomis v. City of Hailey, 119 Idaho 434, 439, 807 P.2d 1272, 1277 (1991). "In a general sense a fee is a charge for a direct public service rendered to the particular consumer, while a tax is a forced contribution by the public at large to meet public needs." Brewster, 115 at 505, 768 P.2d at 768.
As quoted in Hill-Vu (2017) - pgs. 5-6