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Utah Gov. Herbert proposes no new taxes in budget



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SALT LAKE CITY -- Utah Gov. Gary Herbert unveiled his 2011 budget recommendations. His proposed $11.3 billion dollar budget calls for cuts across the board -- except education -- and no new tax hikes.

Herbert said after extensive deliberations, he found a way to address a gaping $693 million hole in a state budget battered by a tough economy and sharply reduced revenue.

He said, "I believe it is rational, I believe it is reasonable, and I believe, more importantly, that it's responsible. All factors considered, what you want to have is a responsible budget."

The budget presents no tax or fee hikes, calls for no cuts to public or higher education, but does cut other state agencies by 3 percent.

"We clearly are recommending to the private sector to step up and help out," Herbert said. "If you have people who are in need of some kind of help -- whether that's food, health concerns, job -- the private sector needs to step up, and we need to help each other."

**Three criteria for Governor Herbert's budget proposal:**
- No tax increases - No additional cuts for public and higher education - Meet state's most critical needs without compromising services
Herbert's $11.3 billion budget proposal is slightly less than the spending plan legislators approved earlier this year. That budget depended heavily on federal stimulus money that won't be available next year to make ends meet. To cover some of that, Herbert is tapping into the state's rainy day fund, planning on bonding for some road construction and counting on the economy to improve.

House Speaker Dave Clark, R-Santa Clara, says he supports the governor's budget though he does think lawmakers do have long-term concerns about the proposal to dip into the state's rainy day fund to the tune of $166 million.

**Governor Herbert's budget recommendations:**
The $11.3 billion Fiscal Year 2011 budget addresses a $693 million shortfall for fiscal years 2010 and 2011. The budget gap is based on:
- $157 million revenue shortfall for Fiscal Year 2010 - $510 million in additional funding for public and higher education, and vital public safety, health and human service needs.
Gov. Herbert also signed an executive order that reduces all state agency budgets, as well as higher education, by 3 percent, effective through June 30, 2010.

Clark said, "We have only so many savings accounts we can dip into, and pretty much they're gone. So we have this year and maybe have one more time to breathe a little time into this equation and after that, it's getting much, much tougher."

Another idea is to raise the tax on tobacco. Though the governor is holding to a no new taxes position, both Republican and Democratic lawmakers think it's worth exploring.

Senate Minority Leader Pat Jones, D-Holladay, said, "I was disappointed he wasn't considering a tobacco tax increase. I think that's something the public supports, and I think it would have brought us in some very good revenue."

Clark said, "Maybe we can do it without as that comes forward, but for me, personally, that's first on the list."

While Herbert makes budget recommendations, it is ultimately the Legislature that will decide where cuts are made and if any taxes are raised. The Legislature convenes in January, and the budget year begins in July.

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Story compiled with contributions from John Daley and The Associated Press.

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