A budget maneuver that effectively skirts the state's spending limit is raising eyebrows on Capitol Hill, with some lawmakers promising to give it close scrutiny.
"Obviously it is of concern," said House Speaker Mel Brown, R-Midvale. "If we're going to have a limitation, it's not good policy to circumvent it whenever we bump up against it."He disclosed Tuesday that he and other legislative leaders have already requested an opinion from the Office of Legislative Research and General Counsel and were planning to raise the issue in an upcoming meeting with Gov. Mike Leavitt.
"If it's not a violation, I suspect there will be some serious consideration given to amending the law to deal with that kind of a loophole," Brown said. "If we're going to call it a spending cap, then let's have a spending cap."
From the Democratic side of the aisle, North Ogden Rep. Grant Protzman said the governor's approach creates the "illusion" of meeting the spending cap when it appears to have been designed to beat it.
"It may not violate the letter of the law, but I think it clearly violates the spirit of the law," said Protzman.
At issue is Leavitt's plan to shelter about $25 million in surplus money in a new Transportation Investment Fund, where it would be protected against a law that places limits on government growth.
Enacted in 1988, the Appropriations Limitation Act limits government spending to a level based on growth in personal income, population and inflation. The state has never exceeded the cap until now, although it came within $1 million of it 1992.
The 1995 budget anticipates a one-time surplus of between $65 million and $75 million. Legislative Fiscal Analyst Leo L. Mem-mott said Tuesday that as much as half that amount might be over the budget limit.
By transferring the excess money to the new fund until it can be legally spent on highway improvements, the governor was able to show 1995 appropriations at $1.1 million below the cap.
Sen. Howard A. Stephenson, R-Draper, who heads a tax watchdog group, remarked, "This is a very interesting way to put a budget together. It is not what it appears to be."
While admitting that the new fund would effectively absorb money that could not otherwise be spent in 1995, Leavitt insists his proposal nevertheless does conform with the law "in letter and spirit."
According to the governor, the state has deferred expenditures from one year to the next "many times over" during the past 10 years. "Budgetmaking is not a one-year process. There is no reason why we have to spend all that money this year," he said.
But Protzman argues that in normal years, budgetmakers aren't trying to escape the law. "This is the first time we've bumped up against the cap; it shouldn't be business as usual," he said.
The law was enacted with the idea that excess revenues would be returned to taxpayers or set aside for emergencies to be followed by long-term budget adjustments, Protzman said. Ideally, the surplus should go back to taxpayers, but rebates would be too small to be worthwhile, he added.
"If it goes anywhere, it ought to go into the rainy-day fund for emergencies - that's where it was intended to go," Protzman said. "The transportation problem is not an emergency, it's a culmination of neglect."
The spending limit law is due to expire in 1996, but legislation has already been drafted to extend it for another 10 years. Protzman, who sits on the committee that recommended the extension, predicts there will now also be attempts to amend the law.
"I'm not saying we should tie our hands to the point where we can't be responsible, but by the same token, I don't see how we have any spending limit at all when it can be so easily circumvented," Protzman said.