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KEEPING HOUSE December 26, 2011

Holiday greetings to all of my constituents. At the Utah legislature, when all is said and done . . . there's a lot more said than done.

Seriously, though, among all the legislature's tasks, I believe our most important duty is to manage the fiscal affairs of our state and its economy. The Utah constitution places the state's purse strings squarely in the hands of the legislative branch.

The governor releases a proposed budget each year, but the legislature must make the tough decisions to formulate an annual mix of taxing and spending that our state needs and that Utah citizens demand.

On Tuesday of last week, the House majority members met in an all-day caucus to discuss our plans and priorities for the 2012 general legislative session, which begins on January 23.

As in recent years, the state budget is shaping up to be the number-one focus of the upcoming legislative session. A big difference this year is that the amount of state revenues collected will not force new cuts in agency budgets, as has been the case for three straight lean years.

Instead, legislative leaders have voted to start this year's budget process at the same spending levels for each agency that concluded last year's session.

This is big news, since the legislature in each of the three previous years had to cut spending, which ultimately resulted in a combined decrease of more than 25 percent in the state's general budget from pre-recession levels.

You may have heard that Utah state tax revenues have actually increased over the past six months. Although this is true, it presents some real dilemmas for a state legislature that leads the nation in fiscal responsibility.

In order to balance the budget the past three years without raising taxes, the legislature had to use most of the state's accumulated reserves (or "rainy day funds"). We also took out loans for major transportation projects, such as the I-15 core project in Utah County.

Furthermore, although we did not cut overall spending on K-12 education during these years, we were unable to provide additional funding to address the approximately 12,000-student increase in enrollment that Utah sees each year.

For all of these reasons, our House majority caucus has taken a sober look at setting priorities for spending the approximately $280 million in increased revenue that the state is expected to see this year versus last year.

First, we voted to increase the state K-12 education budget to at least a level that will fully fund all new student growth, so that our schools will not have to teach more pupils with the same amount of funds as last year.

Second, we voted to decrease our reliance on borrowing by paying for a greater share of building costs in cash rather than in loans. This step will ultimately save our taxpayers hundreds of millions in interest costs by preserving Utah's best-in-the-nation triple-A credit rating. I think it will also set a good example for the federal government and other states to follow.

Third, we voted not to use any more of, and even to try to increase, the state's rainy day funds, which stood at nearly $1 billion four years ago, but now are less than $200 million. Many experts are predicting that the financial situation right now may be as good as the economy will get for several years, so it is important that we save money and be prepared for more hard times.

Finally, we voted to do all we can to avoid any tax increases. Even though it has been hard to see state programs cut these past few years, most citizens seem to support downsizing government rather than increasing taxes.

I want you to know how seriously I take my responsibility to help manage our state's public funds. I realize that the Utah legislature is often portrayed as a Scrooge who stubbornly refuses to give enough money to education and other state programs.

I hope you will understand, though, that there is simply no more money available to distribute, and there are no easy answers in formulating the state budget. It appears that the bulk of Utah's citizens cannot afford to pay more taxes, so we must make do with what we have.

I appreciate your valuable input and continuing support of me and our other state legislators. I pledge to do all I can to be worthy of your trust.

Please call me with any questions or concerns you may have at 435-657-0185 or e-mail me at kraigpowell@utah.gov. Best wishes for a prosperous year!

BY REPRESENTATIVE KRAIG POWELL   12/29/2011



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