The Legislature is reeling from the inglorious undoing of their signature tax reform package. This was the most recent in a series of tiffs with the electorate. In the 2018 election, over legislative opposition, three successful citizen initiatives expanded Medicaid under Obamacare financed by a small sales tax increase, legalized medical marijuana and approved an anti-gerrymandering proposal. The Legislature had refused to expand Medicaid as contemplated by the Affordable Care Act, and they had steadfastly rejected any kind of independent political boundary commission. They had also not moved fast enough, apparently, in legalizing medical marijuana.
The Legislature promptly remodeled both the medical marijuana and Medicaid expansion referenda more to their taste; the public resented their intrusion, even though the marijuana initiative badly needed amending.
Tax reform has been especially fraught with difficulties. First, it’s complicated. Few voters probably understood that the state general fund comes from sales taxes on goods mostly. This revenue is shrinking and will soon be inadequate to fund general state government. The education fund, while burgeoning right now, is unstable because it is acutely reflective of the economy’s ups and down. And income taxes can only be spent on public and higher education. That’s why Rep. Francis Gibson, R-Mapleton, House Majority Leader and Tax Reform Task Force co-chair said, “We don’t have a revenue problem. We have an allocation problem.”
Second, the staggering revenue surpluses of recent years have naturally made people ask why legislators are sounding the alarm.
Third, the 2018 forerunner tax reform bill became highly unpopular because, consistent with good tax policy, it sought to expand the sales tax base and lower the rate. But that meant taxing services like accountants’, lawyers’ and others’ professional fees and realtor commissions. These professional groups pushed back hard.
Fourth, even though tax reform would have given almost everyone a large net tax reduction, the diffuse particulars were hard to explain. All tax reform opponents had to do as they stood in every Harmon’s was tell people to sign their petition or their sales tax on food would increase.
As my friend Professor Robert Huefner says, “The public thinks services come from heaven and taxes comes from the devil.” To some extent, we, the public, talk out of both sides of mouths. We want high-quality, free-flowing roads, but please don’t raise the gas tax. We want more resources for the homeless; mental health services; substance abuse treatment; corrections, law enforcement and courts; cleaner air and water resource development for our future; tourism promotion; and better state parks and recreational amenities. We want — even demand — all these things, but we won’t let the Legislature tax us for them, especially not on food — even though this would only restore the food tax to about 2006 levels. And remember the Legislature is barred by our state constitution from using income tax receipts for any of these noneducation purposes.
It’s unfortunate that the Legislature and public should fall out of sync when politics in Washington, D.C., have become toxically partisan. Legislators and citizens alike need to avoid Washington-style rhetoric and divisiveness and maintain the civility and cooperation we are accustomed to. If we do, I expect we will find mutually acceptable solutions to our taxation imbalance, like we have in so many other areas.
While the Legislature’s relationship with its constituents may be temporarily strained, mutual patience and listening will heal it.
I do worry one new bill could exacerbate the rift between the Legislature and the citizenry. SB91 would revoke the SB54 compromise, which several years ago created a dual track for candidates to get on the ballot in one of two ways, either through being nominated at political party conventions or by gathering signatures. SB54 has worked well and is popular among the general electorate. SB91 would take away the signature-gathering option. While it would affect both parties, in practice it has given a small group of impassioned Republican convention delegates disproportionate influence to skew the party — and its candidates — to the hard right. In my view, it would be a mistake in this super-charged political atmosphere for the Legislature to provoke a fight with the public by taking away something they embrace in SB54 and which is working well.
Greg Bell is the former lieutenant governor of Utah and the current president and CEO of the Utah Hospital Association.