In a nutshell, the State of Utah has a lot of extra money in bank accounts, accounted for as “non-lapsing” funds from various state agencies who have not spent what the Legislature gave them.
However, while the economic good times continue, the state basically broke even last fiscal year and it’s estimated it will break even this current budget year.
Tuesday afternoon the state’s Division of Finance and economists working for the Legislature told legislative leaders that Utah is doing just fine financially.
Yes, in the current year the state could run a $125 million shortfall (out of a $15 billion budget), or it could end up with an extra $115 million surplus (admittedly, a large range).
Overall, the best guess now is that 2016-2017 will end next June with a $10 million surplus.
Pretty good budget-setting for the 103 part-time legislators, I’d say.
However, there is a big BUT in all of this good financial news (some other states face hundreds of millions or billions of dollar shortfalls as the U.S. economy still struggles recovering from the Great Recession).
There is $366 million sitting in General Fund state agencies accounts.
And there is $768 million in what’s called “non-lapsing” education funds.
Or, more than $1 billion in cash (yes, most of it is being invested) that is available for lawmakers to spend in one way or another.
Some legislative Democrats, maybe even some Republicans, may like to get their hands on some of that extra cash. Still, it must be remembered that $144 million sits in the General Fund Rainy Day account, and $349 million is in the Education Fund Rainy Day account.
And while lawmakers can use the Rainy Day funds much as they wish, they don’t like to touch it except for economic downturns and red ink in state budgets.
A lot of numbers were thrown at members of the Executive Appropriations Committee to ponder Tuesday afternoon as budget staffers presented several reports, found here, here, here, here, and here. (Don’t stay up too late reading all of this.)
Always nice to have money.
But the GOP-controlled Legislature raised the gasoline tax a year ago. And if all this extra money found in these new reports is spent, well, conservative voters may start to wonder just how frugal their legislators are.
This is an election year for all 75 House members, half of the 29-member Senate.
Plus, after the Nov. 8 general election, there will be votes on leadership in both bodies, both political parties.
GOP leaders are not talking about any tax hikes in the 2017 Legislature, which convenes the last Monday in January for the 45-day general session.
There is building pressure to raise the personal income taxes by 7/8th of 1 percent, all the money going to public education, hopefully to local schools. Utah remains last in per-pupil spending in the nation.
Herbert has told UtahPolicy he won’t recommend such a tax hike in his 2016-2017 budget, which will be unveiled in early December.
Likewise, GOP legislative leaders say don’t look for a tax hike in this coming session, either.
That puts the decision into the 2018 Legislature, and another election year.
Is it time to tap some of the “non-lapsing” funds in state agencies or in the education budgets?