Tax cuts, debt reduction, education, transportation....
When we dig into the details of the state's budget priorities, calculator in hand, it’s amazing how fast we reach the point where someone says, “… and then there’s no money left for anything else.”
Here are the numbers.
In fiscal year ’08 the State of Utah will have an additional $1.565 Billion dollars to spend or give back to the taxpayers. $676 Million dollars will be ongoing revenue. $760 Million will be one-time money.Re: $676 Million Ongoing
Our colleagues in the House have suggested setting aside $227.2 Million of the $676 for education (that is $300.0 Million minus the $72.8 M already slated for education growth in the Base Budget Bill
), which brings the total ongoing money available to $442.8 Million. The idea is to take out an additional $300 Million for a tax cut, which leaves $142.8 Million for everything else.
What is "everything else
Well, the governor has proposed $70 M ongoing for transportation infrastructure. That is probably a good idea. We also need to give state employees a cost of living increase, which will cost $10.7 Million per percentage point. So, a two percent increase for all state employees will cost $21.4 Million. A three percent raise would cost $32.1 Million. We also need to reserve $18 Million for health insurance and retirement. Committee priorities have yet to join the equation.
Do the ruthless math and watch how fast even an unprecedented surplus is whittled down.
That said, we’re excited to
- Do some great things for education this year;
- Provide necessary funding for transportation,
- Take care of state needs; and
- Give the extra money back to the taxpayers.
We are going to continue working out the details in a special caucus meeting tomorrow (Saturday). The goal is to flesh out some initial decisions that make sense.Re: $760 Million One Time Money
Most of us feel like it makes little sense to go deeper into debt this year - in fact, we should be paying off as much debt as possible. If we pay cash instead of bonding for current state projects we need to complete, we’ll need to reserve $400 Million from our one-time pot of gold ($50.0 M to finish the Capitol Renovation, $100 M for roads and $250 M. for Centennial Highway construction).
That would leave the state with $360 Million net one-time money. Paying off existing debt could eat into that to the tune of almost $200 Million ($194,925,000 to be exact). If we want to pay cash for USTAR instead of bonding, that would be another $110 Million.
Again, the Senate Majority will meet for a special planning caucus tomorrow (Saturday) to dig deeper into these numbers and make some tough choices.
We’re excited by the unprecedented opportunity facing our state this year. We're honored by the weight of the consequential decisions before us, and are looking forward to working with our colleagues downstairs on priorities and the ultimate direction of state policy.