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COST OF UTAH TAX INITIATIVES OUTWEIGHS THEIR BENEFITS

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Utahns who follow politics closely know that candidates who enjoy overwhelming support early in a campaign often see their leads dwindle and even disappear as time goes by.

And now, judging from recent polls, Utahns are also seeing the same thing happen to the tax limitation initiatives on the Nov. 8 ballot.Up to a point, the initial enthusiasm for these initiatives was certainly understandable. After all, Utahns have long carried a heavy tax burden because Utah has a higher proportion of its population enrolled in public schools than any other state. This state's economy has been anything but robust lately. Moreover, Utahns have a long tradition of demanding frugality from their public servants.

Under these conditions, a backlash was predictable when the governor and the Legislature felt a record tax hike, rather than a series of smaller increases, was necessary in response to a growing backlog of unmet state needs.

But as the fight over the tax limitation initiatives has proceeded, the opposition to them has grown from a whisper to a chorus swelled by the voices of more and more individuals and groups.

So numerous and responsible are those voices, in fact, that it's unrealistic to try to dismiss all opposition to the tax initiatives as just a reflection of short-sighted self-interest.

Instead, a better explanation would be that as Utahns have taken a closer look at the tax initiatives, they have stopped focusing almost exclusively on the benefits to be gained and started realizing what a steep price would have to be paid for them.

What, exactly, is that price?

As this page seeks to answer that question, readers should keep in mind that our views on the tax initiatives are those of this newspaper's publisher and editorial board but not necessarily those of our owners.

In any event, part of the price can be counted in terms of the increased cost Utah might have to pay for general obligation bonds if the tax limitation initiatives are approved. Though the initiatives are supposed to guard against such an adverse impact, the fact remains that Standard & Poor's several weeks ago responded to those propositions by placing Utah on its Credit Watch list with what the New York-based bond rating firm termed "negative implications." Why? Because, as S&P put it, the tax initiatives could "diminish the financial flexibility which allowed Utah to maintain excellent financial operations despite a cyclical economy." Moody's Investors Service also reports that most other states adopting tax curbs have seen their credit ratings suffer as a result. The clear implication is that a ceiling on taxes now could easily mean higher bonding costs later.

Another part of the cost of the initiatives can be counted in terms of the federal matching funds Utah would lose. For example, for every $1 dollar the state provides, the federal government provides $4 for Medicaid, $3 for welfare, and as much as $20 for highways.

Then there is the possibility that government officials might respond to the initiatives by switching from taxes to user fees. That's often done because the same people who want lower taxes aren't always willing to accept fewer government services.

For example, if police and fire fighting operations must be curtailed in response to the tax curbs, the initiatives might exact a painful price in terms of more crimes and more fires.

True, the public could get more for its money if various units of government were merged. But voters in Salt Lake Valley, for example, have repeatedly rejected broad efforts at city-county consolidation. Even less ambitious efforts involving the merger of law enforcement and other selected operations have been thwarted by officials who would lose their jobs and by a public unwilling to demand even such limited consolidation.

Likewise, consider certain other costs Utah could pay for the tax initiatives. For example, cuts in motor fuel and diesel fuel taxes likely would result in less money for maintenance and snow removal on Utah roads. This could translate into more time in commuting, more potholes, more accidents, and more car repair bills.

What about the public employees who would have to be fired in response to the belt-tightening brought on by the tax limitation initiatives? In Salt Lake County alone, officials estimate 680 full-time positions would have to be eliminated. There's little slack in the private sector to absorb such workers. And that would mean a bigger drain on unemployment benefits and the welfare rolls.

But the steepest price of all seems to be the one involving Utah's schools, which depend heavily on the property tax. Officials estimate the tax initiatives would deprive public education of $125 million - but if all administrative costs were eliminated, the savings would come to only $11 million.

No wonder the State Board of Regents warned long ago that the initiatives might slam the doors of higher education to as many as 10,000 Utah college students.

Though reasonable people can disagree over these and various other figures in this issue, there can be no disputing the fact that Utah can't water down the quality of its education without also impairing its ability to generate new jobs and new revenue.

In short, good intentions are no substitute for good plans. The more closely Utahns look at the cost of the tax limitation plans on the Nov. 8 ballot, the clearer it should be that these initiatives ought to be rejected.