Five state representatives and senators met for a Legislative Preview hosted by Action Utah in Park City on Wednesday night. One of the hot topic issues for the evening was Tax Reform and funding for education.
The five elected representatives spent an hour and a half as panelists speaking to a crowd of around 40 Wasatch Back residents. The panelists spent a fair amount of the time discussing the recently passed Tax Reform law and the citizen led referendum effort to repeal the law that has followed. Republican Senator Allen Christensen, of North Ogden, noted that if the referendum gets enough signatures on the ballot it will significantly impact the 45-day legislative session.
“If they get the signatures so that it gets on the ballot, our budgeting process is on hold,” Christensen said. “Because, we don't know what we can fund and what we can’t fund. We’re going to have to wait to see if it passes in the fall, we don’t know if we have the money or not.”
Republican Representative Tim Quinn, from Heber, was on the tax force commission that sought a solution for tax reform. Rep. Quinn ended up voting against the final version of the Tax Reform bill, but he did outline some benefits he saw from the Tax Reform bill that was passed, including a state estimation that 84-86% of Utahns will receive a tax cut from the reform. A large factor of the Tax Reform effort is the consideration to lift the spending requirements on income tax collected by the state. Right now, the Utah state constitution requires all income tax collected by the state must be spent on public and higher education. Rep. Quinn explains why he believes the earmark should be removed.
"We just lowered the income tax rate from 4.95 to 4.66, we could lower it to zero if we wanted to without any constitutional requirement,” Quinn explained. “What I suggested a year ago in a working group at the Salt Lake Chamber of Commerce was do away with the earmark but put statutorily in a true floor for education that would never fund less than X. X to be debated, but X would be a percentage of the entire state budget. Whatever that number is, let's make sure we never go below that. Now education has a true guarantee, and then you can look at tax policy in a holistic way.”
Democratic Representative Brian King, of Salt Lake City, conceded that the earmark doesn’t guarantee funding for public education. Rep King argued that legislative efforts in 2007 and 2018 to lower the amount of income tax revenue hurt public education outcomes, noting that Utah consistently ranks at or near the bottom in per-pupil spending against other states in the union.
“Representative Quinn’s right when he says the earmark itself doesn't guarantee any funding,” King continued. “You’ve seen it the last couple sessions 2018 that is, and then again in the special session. The legislature can go in and cut the income tax rate which results in a loss of revenue for public education. We can do that at will and we have done it a couple of times. You what stops us from doing that? You! Who you vote for and who you don’t vote for. You need to stop voting for people who are going to cut revenue for public higher and education, period. And look I love these guys, but it really aggravates me when we have rationalization for not funding public and higher educational at the levels that we need to. This is the most important, most fundamental investment we can make in the state of Utah. There's nothing more important.”
In response, Rep. Quinn revealed some findings from a conversation he had with the state auditor, who looked at revenue collection per capita for the past 20 years. Rep Quinn said the state is collecting more tax dollars per capita today than has ever been collected by the state.
“When we cut it, what Representative King forgot to tell you was that was right on the cusp of the 2nd largest recession in the country's history,” Quinn said. “Of course, revenues were going to drop. We were also the first state to recover out of that Great Recession, I believe in large part because legislation did lower the rates, fueled the economic engine that has kept the number one managed state in the last 12 years. Second point, yes, we are 50th in the nation, but we are one, two or three in effort. Meaning we fund education as a higher percentage of our entire state budget, because we do value it. We don't have a mechanism that most states have in this country to fund education and that’s property taxes. There’s only three state who own less of their state than we do. We lose two-thirds of our funding revenue from education, because we can't charge property taxes on 70% of our land.”
Should legislators vote to remove the education fund earmark the item would come before Utah voters on the November ballot to ratify or reject the amendment to the state’s constitution. You can find a link to the full legislative preview here.
