During the session, there are many many important issues that we discuss, but by far the most important job of the legislature is the allocation of the budget. As you are already aware, this year’s budget discussion will have many challenges because there are still so many unknowns. We do not know what will be decided in Washington or how those decisions will affect us. Predictions are grim no matter what they decide. If the sequestration is allowed to happen and the spending cuts take place, our state budgets will be affected. If some agreement is not reached and the debt reduction measures are essentially postponed, economist say that there could be extreme financial consequences within a few years.
You are also probably aware, that in spite of all the recent economic problems, Utah is doing better financially than most other states. Utah’s financial stability is not necessarily due to our Constitutional requirement to balance the budget each year. Forty-eight other states actually have that requirement in their Constitutions. But many of those states have found ways to work around that requirement. Utah’s level of fiscal stability comes from the legislature making responsible, informed decisions and the fact that we fund realistic budgets with the money we have available.
The only way the Legislature has money to spend on anything is if that money is taken from us as citizens in the form of some tax. It is always interesting to me how many times I hear, “The Legislature needs to spend more money on…” But I don’t hear, “The Legislature should raise taxes so that they can spend more on…” People seem to forget that first part about where the money actually comes from.
Careful Oversight of Tax Dollars
The majority of the Utah Legislature is not of a tax-raising mindset. Occasionally, as may need to be discussed this year, the incoming tax revenue is simply not high enough to cover the existing needs of the state. In that situation, the choices are simple: eliminate and/or reduce existing programs and/or increase taxes. Over the past few years, departments have been asked to cut and trim internally so that budget dollars can stretch and for the most part they have done a good job. But our state’s needs continue to increase, our school populations are growing and federal requirements are creating more of a strain. All of these elements add up to the possibility of increasing taxes.