For the first time in recent memory, the biggest source of income for Utah’s budget comes from the federal government.
New numbers from the legislative budget office show that just over 26% of Utah’s 16.8 billion budget comes from the feds. That’s about $4.3 billion in federal money coming into Utah.
Another 25% of the state budget is from the Education Fund, while 15% is in the General Fund.
“It concerns me that so much money comes from the federal government,” says Senate Majority Whip Stuart Adams (R-Layton). “If there comes a point that money dries up, it would be devastating on our budget and the people that money is supposed to serve.”
The biggest chunk of that federal money is for Medicaid and other entitlement programs. In fact, spending on social services makes up the largest outlay in Utah’s budget this year at 32%. Spending on public education makes up another 31%, while higher ed is 13%. That’s more than 3/4ths of the total budget on just three areas. Transportation takes up 10%, while 4% goes toward law enforcement.
The good news is just 2% of Utah’s spending goes toward debt service.
If the proposed ballot initiative to take full Medicaid expansion under the Affordable Care Act makes November’s ballot and passes, the amount of federal money coming into Utah will jump significantly, as will the state’s spending on social programs. Right now, 70% of Utah’s Medicaid spending comes from the federal government, with a 30% match from the state. Medicaid expansion through the ACA moves that to a 90/10 split with the feds. Adams says that will push Utah toward a situation that might become untenable in the future, because the state will become even more reliant on federal money.
Plus, he says boosting Medicaid spending may mean less money for education.
“We’ve been fortunate enough to find significant increases in funding for public education in recent sessions,” says Adams. “I don’t know how we will find money to do that again if everything is already accounted for.”
The 2018-19 budget numbers also show more than $800 million in new spending. 35% of that went to public education and 21% to higher ed. That included a $77 million increase in the WPU and $36 million for public education growth.
11% of the new money, or more than $85 million, went to the state’s rainy day fund.