After a year of special legislative sessions to pare the budget in anticipation of shortfalls, it may seem counterintuitive for Utah’s newly sworn-in Gov. Spencer Cox to face coffers flush with money, but he does.
That’s a tribute to wise stewardship from outgoing Gov. Gary Herbert and legislative leaders. A combination of growth and savings from those budget cuts have given the state $728 million in ongoing general fund/education surpluses and $1.268 billion in extra one-time money. The state’s rainy day emergency funds are almost $1 billion strong. Unemployment, at 4.3% in November, remains far below the nation as a whole.
Compare this to many other states, and it’s easy to see how well the Beehive State is weathering the current storm, despite the many serious challenges it poses. Late last year, the Center on Budget and Policy Priorities noted a 6.4% drop in state tax collections nationwide between March and August of 2020, compared with the previous year.
It’s much easier to budget when money is plentiful than when it is scarce. Still, budgets must remain prudent, with an eye toward the fact that COVID-19 remains a potential drag on revenues, even as it destroys lives and wreaks havoc on families.
Cox’s first proposed budget, revealed this week, calls for a healthy increase for public education, including a 5.82% hike in the weighted pupil unit and $112 million for teacher bonuses. It would invest hundreds of millions in long-term transportation needs, including money to double-track the FrontRunner line. It also includes considerable investment for rural infrastructure, including money for rural broadband and electric-vehicle charging stations.
Also, his budget would put $250 million toward further pandemic response efforts.
It’s almost become tradition in Utah that governors unveil their budget proposals just before the legislative session begins, and that lawmakers promptly set it aside and go their own way in drafting the final spending plan. That’s understandable, given that lawmakers have a duty to pass a final budget. Generally, the executive and legislative branches work together on thorny spending issues, tax matters and priorities.
But Cox has given lawmakers a good template from which to begin. He even included an $80 million tax cut in the form of a Social Security tax credit for low- to middle-income seniors — a limited reduction aimed at just the right target.
Of course there are things we wish he had included, such as more money to help retrofit older homes built with unreinforced masonry. Last winter’s earthquake along the Wasatch Front ought to have brought the need for this into greater focus. We also note that many of his more noble-sounding ideas, such as $26.3 million for students at risk of failing school, lack the kind of detail that would allow for careful analysis.
Also, efforts to shore up rural vehicle charging stations may not match up with market demands, although the governor notes correctly that the lack of such infrastructure may be inhibiting the market from accelerating toward electric vehicles.
One more thing: We particularly like a section of Cox’s budget titled, “Why we should avoid earmarks.” As he explains, “a healthy annual budget prioritization process” makes for a fiscally healthy state. Utah has drifted much too far into the realm of budgeting by statute, putting certain requirements into law that remove politicians’ duty to reorder state priorities as needed, or that result in automatic increases to the gas tax.
That’s one more thing for the Legislature to seriously consider as it approaches a year that, all things considered, will not be as difficult economically as many had predicted.