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State revenue higher than expected, but what will the money fund?

By Lisa Riley Roche | Posted - Mar 1st, 2014 @ 7:01pm

SALT LAKE CITY — Lawmakers learned Friday they have a little more money to spend in the new budget year that begins July 1, but it's nowhere near enough to cover all of the new programs being pitched this session.

House Budget Chairman Mel Brown, R-Coalville, announced on the House floor that analysts for the Legislature and Gov. Gary Herbert agree there will be an additional $11 million in one-time funds and $47 million in ongoing revenues.

That means there will be $144 million in one-time or surplus dollars left over when the current budget year ends June 30, and $253 million in revenue growth in the coming budget year.

Brown reported, however, that both surplus and ongoing general fund revenues that largely come from sales tax collections had to be revised downward. Education funds that come from income tax collections are up.

The annual revision in revenue estimates toward the end of the session are important because it tells lawmakers how much money is available to add to the base budgets already approved.

Senate President Wayne Niederhauser, R-Sandy, said there may well be some "intense discussions" about the budget before the session ends March 13.

"We knew we were going to be in a crunch with all of the new ideas out there," he said.

Lawmakers are being asked to support an education technology initiative from House Speaker Becky Lockhart, R-Provo, that would trade textbooks for tablets in Utah classrooms.

The price tag for the initiative was initially nearly $300 million, but that has already been scaled back. The initiative is competing with other education spending, including a boost in the amount of money available for teacher compensation.

Lockhart is also pushing a state-funded alternative to the Medicaid expansion offered under the Affordable Care Act, better known as Obamacare, that would cost an estimated $35 million a year over the next two years.

Both Herbert and Sen. Brian Shiozawa, R-Cottonwood Heights, have proposed plans to provide health care coverage to low-income Utahns with the federal funds available to the state for Medicaid expansion.

The speaker was upbeat about the revenue estimates.

"I think it was good news for anything that people want to see funded," Lockhart said. "The technology initiative, it's a big ask, obviously. So having more revenue, obviously, is better."

The speaker said she believes there could have been "a significant commitment" to her education initiative even without a revenue increase, as well as to the House proposal to deal with the Medicaid expansion.

There will also be "a lot of support" for funding growth in public education and an increase in the weighted pupil unit, the funding mechanism for schools, Lockhart said, but how much of an increase remains to be seen.

The governor is seeking $61.6 million, a 2.5 percent increase in the weighted pupil unit. Herbert said in a statement his chief priority "is and always has been funding education."

Given the size of the new revenue estimates, Senate Minority Assistant Whip Pat Jones, D-Holladay, said it's not clear where the money will come from to pay for education needs, as well as the speaker's initiative.

"I think anytime there is pulling and pushing somewhere, it will have to come from other places," Jones said. "It's going to be interesting to see where that comes from."

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