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Amendment G would expand uses of income tax for programs for kids, disabled

State income tax has been solely earmarked for education for more than 7 decades

Spenser Heaps, Deseret News

SALT LAKE CITY — Depending on whom one asks, proposed constitutional Amendment G is either a vote for historic stability in Utah education funding or a change that will further dilute income tax revenues, which have been earmarked for education for more than seven decades.

Amendment G may be the final question on Utah’s statewide ballot but it’s front of mind for lawmakers who urge Utahns to vote for it and child and responsible government advocates who recommend that voters reject it.

Backers say passage of Amendment G will trigger the enactment of HB357, which will annually fund public school enrollment growth and inflation and fund an education stabilization account to protect against economic downturns.

Senate Majority Assistant Whip Ann Millner describes the opportunity before voters as a “historical moment.”

“What HB357 does is really make sure that we provide a funding framework for public education that we’ve really never had in the state. It says that our first priority, as long as we have additional revenue, will be to fund enrollment growth in public education, and then an inflation factor for public education,” said Millner, R-Ogden.

But critics say the ballot language is vague and eliminates the seven-decade-old earmark on state income tax that reserves it solely for public education. In 1946, Utah voters approved a constitutional amendment that established the earmark and 50 years later, Utah voters approved another constitutional amendment that expanded the use of income tax for public colleges and universities.

Amendment G asks voters whether income tax can also be used to fund programs and services for children and people with disabilities. It doesn’t mention education.

Voices for Utah Children CEO Maurice “Moe” Hickey says it does nothing to solve the real problem, that all programs that serve Utah children are underfunded.

“A major question we have to ask is, if the current constitutional earmark has failed to help Utah invest more in education, how will getting rid of it improve matters?” said Hickey, a former president of the Park City Board of Education.

The Utah Foundation’s recent report, “On The Ballot,” analyzed all seven proposed constitutional amendments before Utah voters. The independent, nonpartisan, nonprofit research organization says the fiscal impact of Amendment G is “unclear.”

“The definition of programs that “support children and ... support individuals with a disability” is not well-defined and is subject to interpretation. The Lieutenant Governor’s Office estimates that up to $600 million is currently spent on such categories. Still, the vagueness of the categories makes it difficult to understand how much money might not go to schools because it can be redirected to services previously covered by the General Fund,” the report states.

Others, like the League of Women Voters of Utah, oppose Amendment G because the public has not been adequately informed of the “sweeping changes” that will occur if it passes.

“Shuffling income tax monies from constitutionally protected education funding and allocating them to social programs now funded by sales tax revenues is a way of enacting tax reform without informing the public,” said Catherine Weller, the league’s co-president.

Sen. Luz Escamilla, D-Salt Lake City, who authored arguments against Amendment G that appear at voteinfo.utah.gov, also raises the issue of tax reform, noting the Legislature’s failed attempts to overhaul tax policy in 2019.

“Last year’s failed attempt at tax reform was flawed because it only addressed the sales tax side of our revenue structure. This amendment is equally flawed because it only addresses the income tax side. ... We will need to roll up our sleeves and do the hard work needed to address both sides of the equation, then gain the support and buy-in of you, the voters. That is the responsible way forward,” she wrote.

Arguments in favor of Amendment G by House Majority Whip Rep. Mike Schultz and Sen. Dan McCay note widespread support among education groups. They include the Utah Education Association, Utah State Board of Education, Utah School Boards Association, Utah School Superintendents Association, Utah Association of Public Charter Schools, Utah PTA and the Utah Taxpayers Association, among others.

The parties, including Gov. Gary Herbert, linked arms for a photo-op after announcing a “historic” compromise struck in the waning days of the 2020 legislative session following a series of closed-door meetings after which the parties agreed to back HB357 and SJR9, which placed the proposed constitutional amendment on the statewide ballot. A majority of voters must approve a constitutional amendment for it to take effect.

Amendment G provides funding assurance and a safety net, explaining that income tax is the least stable source of education funding, according to Schultz, R-Hooper, and McCay, R-Riverton.

“Amendment G is specifically designed for economic uncertainty when income tax revenues shrink. The proposal protects education funds and moves current K-12 education funding into a constitutionally protected account.

“It also ensures education funding will automatically grow by tying it to enrollment growth and inflation, providing K-12 education greater security and stability. ... Utah’s students and educators deserve funding stability and security,” Schultz and McCay wrote.