Utah’s Budget Picture ‘Rallies’ at End of Fiscal Year

Utah State CapitolWith a “rally” of the state sales and corporate income tax receipts this spring, Utah government’s final tax take for the fiscal year that ended June 30 should be about even – maybe $10 million extra in the road fund and up to $35 million in the black in the General and Education Funds.

So says Jonathan Ball, the Legislature’s top fiscal officer, after reviewing the latest Tax Commission TC23 report on revenue collections.

Can you hear a big sigh of relief from Capitol Hill?

Estimates a few months ago had the state down maybe $80 million or more at fiscal year’s end.

Of course, in a $14-billion budget, that’s not much of a percent.

But, still, lawmakers and GOP Gov. Gary Herbert would have had to come up with the deficit money somewhere, for the state by law must balance out each fiscal year’s budget.

The state uses what leaders call “consensus numbers” in revenue projections and budget setting.

A group of economists from Ball’s office, the governor’s office and the tax commission every four months or so meet, review economic trends and tax collection numbers and come up with tax-take projections.

“These folks are so good, so awesome, sometimes it scares me,” said Ball.

The latest TC23 “preliminary” 12-month, fiscal year’s end, report shows:

— Sales and use taxes were estimated to grow 3.5 percent last fiscal year; they rose by 4.2 percent.

— Personal income tax estimated up by 6.4 percent, up by 6.6 percent.

— Corporate income tax estimated down by 7.2 percent, down really by 9.1 percent.

— Severance taxes, estimated down by 66.7 percent, really down by 68.5 percent.

— Alcohol taxes down by 0.9 percent, but really up by 1.5 percent.

In the Transportation Fund, with a per-gallon gasoline tax increase taking effect Jan. 1, it was estimated that overall fuel taxes would be up by 9.6 percent, but they were up by 14.3 percent.

“That’s because the price of gasoline has been so low for so long that people are driving more – thus buying more gasoline,” said Ball.

Utahns are also buying more cars and trucks, with vehicle registration fees estimated to grow 3.2 percent, but really up 4.3 percent.

All this is because Utah’s economy and wages are on the upswing – in part reflected in Herbert’s big win in the late-June GOP gubernatorial primary.

Things are pretty good in Utah.

And the latest TC23 report shows that instead of a possible deficit in the last fiscal year when the books are finalized by the end of August or early September, there should be a small multi-million surplus – which lawmakers will decide what to do within the early-2017 general session.