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2009 Legislature: Time for more budget cuts

Only one day into the 2009 Legislature and Republicans are getting set to cut another 4 percent from current state budgets.

The pain will be felt in all departments, House Republicans were told Monday evening just before the 53-member GOP caucus voted almost unanimously to make the tough reductions.

The real pain, however, will come later in the 45-day session that opened Monday when the budget for the next fiscal year, starting July 1, is set.

As part of that, some moderate House and Senate members are asking that a general tax increase should be considered.

"I supported this — but I see now it was a mistake," Rep. Kory Holdaway, R-Taylorsville, said about lawmakers' decision to take much of the state sales tax off of food.

"The Senate is talking" about putting part of the tax back on food, Holdaway said. "And it should be part of a serious discussion."

However, several House conservatives immediately jumped up in the GOP caucus to say any general tax hike would be a mistake.

"Pulling more money (through a tax hike on a basic need) will do more harm than good in the long run," said Rep. Greg Hughes, R-Draper.

And increasing the food tax would likely be opposed by GOP Gov. Jon Huntsman Jr., who points to reducing that tax as one of his top accomplishments in his first term.

Huntsman was roundly criticized in the open House caucus, although his name was not often mentioned. House Speaker David Clark, R-Santa Clara, went on at some length over how Huntsman not only refused to call legislators into a special session last November to deal with the growing budget deficit, but has stopped "dead" the issuing of $1.2 billion in road bonds for projects that could be helping Utah's failing economy.

Once counting quietly to 10 to control his rhetoric, Clark said he is mystified by Huntsman's actions — saying the state is spending $2 million a day it doesn't have and now legislators have to cut more deeply to balance the budget by fiscal year's end, June 30.

Privately, Clark also complained to lawmakers that GOP leaders have to talk to Huntsman's budget director, instead of the governor himself, over renewed negotiations on this year's budget cuts. House Republicans voted to trim 7.5 percent from current budgets, and then put back in 3.5 percent (in most budgets) — meaning 4 percent must be cut this year. That means about $175 million more must be trimmed.

Senate Republicans also supported that proposal, even if they are getting blamed for plans that actually come from the governor. Senate Budget Chairman Lyle Hillyard, R-Logan, said from the floor Monday that those include autism preschool programs, meals-on-wheels service and mental health care (which will be restored).

"These are recommendations given to us," Hillyard told the Senate. "I've sensed (from) some of the mail and the calls I've gotten, they think it's the mean Legislature that's done this."

The 4 percent cuts proposed by the House Republicans will come mostly from one-time funding previously allotted to projects that have not, for the most part, been started:

$52 million that would have built a housing pod at the Gunnison State Prison.

$46 million from buildings for USTAR — the Utah Science Technology and Research initiative.

$15 million from the state's disaster relief fund.

$30 million from the state's water loan development fund.

Finally, $32 million in cash will be taken from other state building projects, and bonds will be issued instead. Some House moderates wanted to take that cash out of the state's $414 million Rainy Day fund.

"Why use our credit card (bonding) when we have cash in the bank?" asked Rep. Eric Hutchings, R-Kearns.

But GOP leaders said all of the $414 million should be saved, fearing that some of it will be used not only in next year's budget, but in fiscal 2010-11.

"Remember," said House Majority Leader Kevin Garn, R-Layton, "the governor wanted to bond for all of the $175 million that we're taking" from existing projects and funds. So as conservatives, there should be less borrowing and more budget cuts, said Garn.

GOP leaders will now use the hard-line taken by their caucus to deal with Huntsman, who believes more money should be returned to Human Services and some other programs this year.

Huntsman spokeswoman Lisa Roskelley said "discussions are still ongoing" with lawmakers over the budget.

Legislative leaders plan to pass a "base budget" bill early next week. Should Huntsman veto it, lawmakers would still be in session to override it.

The cuts are going to hit everyone, including legislators. Senate President Michael Waddoups, R-Taylorsville, said the GOP caucus members were told they are expected to cut back and that some House and Senate staffers have been told to avoid overtime and may even be given unpaid days off.

Waddoups said the Senate Republicans remain committed to a 15 percent cut in the budget year that begins July 1. "We have to," he said, adding that the only way that could change is if the February revenue estimates are better than anticipated.

Meanwhile, Democrats are so few in number that major budget decisions are often made without their approval.

"In several meetings with the governor, we have been very clear that this caucus supports his approach," said House Minority Leader David Litvack, D-Salt Lake. "Not necessarily his budget, but his approach to the budget."

Some House Democratic caucus members took umbrage with revenue enhancements that Huntsman has proposed, including raising the vehicle registration fees by $21 and increasing the gas tax. Freshman Rep. Brian King, D-Salt Lake, said the increases unfairly target residents with lower incomes.

"All these tax increases that the Republicans are proposing are incredibly regressive,"King said.