POCATELLO — A local government watchdog group is criticizing the city for allegedly using a “disguised tax” to collect more than $11.5 million from Pocatello residents over the past 10-plus years.

Pocatello for Accountable Government Entities, or P.A.G.E., recently issued a press release alleging the city has been collecting what the group describes as unconstitutional right-of-way maintenance fees from Pocatello residents since 2014. This has occurred despite a series of utility fee lawsuits against the city of Pocatello over a seven-year period ending in 2019 that culminated in a $4.5 million settlement between the city and plaintiffs for what was ruled to be unlawful “payment in lieu of taxes,” or PILOT fees.

The settlement resulted in Pocatello reimbursing residents for some of the money illegally charged on their city utility bills.

“Pocatello residents will recall the utility fee lawsuits of 2012-2019 that 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 of the nearly 10 years that taxpayers were overcharged,” the P.A.G.E. news release said. “Months after a Nov. 15, 2013, injunction ordered Pocatello to cease collection of the PILOT fee and rather than make all the necessary adjustments to offset the resulting $2.2 million 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.”

Heather Disselkoen, co-founder of P.A.G.E., attended the June 25 Pocatello City Council town hall meeting at City Hall and suggested the council ask the Idaho Attorney General’s Office or another non-biased party to review the legality of the fees.

In response to P.A.G.E.’s allegations, the city of Pocatello released the following statement: “The city of Pocatello adheres to all applicable generally accepted accounting principles and is committed to complying with relevant laws, regulations, and policies. Our financial practices are regularly reviewed and updated each budget cycle to ensure continued alignment with legal and professional requirements.”

P.A.G.E, a community-based Facebook group established in April 2020, argues these new fees — added to the budgets of the sanitation, water and water pollution control departments to reimburse the Pocatello Street Department for repairs from the wear-and-tear on streets caused by city vehicles — violate what the group believes are the same legal principles as the earlier charges that a court ruled were unlawful in the PILOT class-action lawsuit.

P.A.G.E. said these new fees aren’t visible on the city utility bills Pocatello residents pay. But they are baked into the budgets for the sanitation, water and water pollution control departments, which are then used to calculate the utility fees city residents pay.

As precedent for its position, P.A.G.E. points to a 1988 lawsuit against Pocatello, a 2021 lawsuit against the city of Lewiston and other recent challenges within the same Lewiston case that were decided by the Idaho Supreme Court.

“After other challenges within that same (Lewiston) case were decided by the Idaho Supreme Court in July 2023, the city of Moscow self-corrected mid-budget year to remove (its) unlawful utility fees and restore compliance with the Idaho State Constitution,” P.A.G.E. said in the news release. “The city of Pocatello has disregarded the 2021 court decision (against Lewiston) and continues in its collection of these disguised taxes.”

P.A.G.E. is demanding the Pocatello City Council eliminate $1.7 million in estimated fee revenue from the proposed 2026 budget to avoid what the group warns could be another costly lawsuit.

“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 $1.7 million-plus in budgeted right-of-way revenue from the proposed fiscal year 2026 budget,” the P.A.G.E. news release said. “This is the only honest, ethical and lawful path forward.”

After P..A.G.E. issued its press release, the watchdog group said the city lowered the right-of-way revenue in its proposed 2026 budget to $1.5 million.

P.A.G.E. still feels the revenue should be eliminated from the budget.

The group describes what it calls a multi-million dollar “regulatory taking” as a betrayal of trust that “deepens the divide and distrust local citizens have in the city of Pocatello’s elected government.”

No court has ruled on the legality of the current fees that P.A.G.E. is challenging. The $11.5 million figure represents P.A.G.E.’s calculation of total collections since 2014.

P.A.G.E. says its mission is to encourage civic involvement, educate voters by sharing relevant local government data, information and decisions and to hold local elected officials accountable for their actions to deliver a government that is transparent and responsive to the Pocatello community they serve.

P.A.G.E. has a well-established record of holding the city, School District 25 and Bannock County accountable regarding a wide variety of issues.

In 2020, the group uncovered a clerical issue by the city that could have resulted in a $4 million shortfall in Pocatello’s fiscal 2021 budget.

P.A.G.E. was also the first to report about Highland High School’s failed fire inspection that preceded the 2023 fire that destroyed much of the school.

The group promoted and testified in favor of legislation that became law in 2024 that improved the state’s bond election ballot questions.

P.A.G.E.’s investigation into the funding from Idaho State University for the proposed Eastern Idaho Forensic Pathology Center also resulted in $850,000 being returned to the state when the project fell through.

For more information about P.A.G.E.’s investigations visit pagefiles.org.