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SALT LAKE CITY — Utah's governor signed several bills into law on Monday but vetoed one related to school funding. In a press release, Gov. Spencer Cox said he vetoed SB37, which would allow property tax to go into a state-owned account instead of directly to local school districts. Lawmakers will then distribute the funds to schools, but the funds could also be used for other services like social services, transportation, and public safety, bill sponsor Sen. Lincoln Fillmore, R-South Jordan, told KSL NewsRadio. “(The bill) does not touch any property tax levy that is initiated by a local school district,” Fillmore said. “It does not change the timing, the amount or the permitted uses of any education dollars that school districts will receive.” However, Cox believed the bill complicated the process of public schools receiving funding from tax dollars. "Right now, Utahns are correctly told by their government that their local property tax dollars are going to fund their local schools," Cox said in letter to lawmakers. "That arrangement is spelled out specifically in our annual property tax notices, and it’s a promise we’ve honored for decades." In his letter, Cox said SB37 creates a "perception problem" with taxpayers and "significant technical and legal questions." "For one, it’s not entirely clear whether these property tax dollars, once they land in the general fund, still carry the restrictions that have always protected them for education use. Without that clarity, future legislatures could easily redirect those funds to other priorities and away from Utah schoolchildren. I oppose that change," Cox said. Cox said school districts will have to track how funds are being received and used in a new complicated system that SB37 creates. "This 'grossing up' makes financial statements look inflated, which creates confusion not just for taxpayers, but also for bondholders and auditors who rely on clean, straightforward reports," he said. The press release also included a letter from Utah State Auditor Tina Cannon, urging Cox to veto the bill. According to Cannon, SB37 could divert about $700 million from public education for general fund use, which could create legal issues. "The Office questions the constitutionality of a law that supplants constitutionally restricted funds at the state level with local restricted funds, resulting in unrestricted state funds for general fund use," Cannon said in a letter to Cox. Cannon recommended that the bill should be delayed until January 2026 to allow the state to properly disclose where funds are going without potentially misleading the public. "Implementing this bill without modifying would be misleading to Utah taxpayers because it states that it is for education while the bill’s intent is for those funds to be unrestricted in the state general fund," Cannon said. The Utah Education Association positively responded to the veto, saying that SB37 would have removed funds from public schools and "weakened local control."
