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Show State Revenue Shortage Looms For 1970 7, Fsuncfefion Says The recent slowdown in the economy is hegining to cause some serious problems prob-lems in balancing state finances. fi-nances. This was the conclusion con-clusion reached by Utah Foundation, the private research re-search organization, in their latest analysis of state budget problems in Utah. According to the Foundation Foun-dation report, state revenue reve-nue collections for major taxes are running behind estimates made at the time of the 1970 Legislative Session. For the fiscal year ended June 30, 1970, individual income tax collections col-lections were SI. 7 million under the estimates contained con-tained in the Governor's budget, corporate franchise fran-chise revenues were nearly near-ly $1.0 milion short of the amount estimated, and sales tax collections were S524.000 under the official offi-cial budget estimates. Even more serious than collections according to the report, is that revenues reve-nues for the 1970-71 fiscal fis-cal period were projected in the budget from earlier (and therefore higher) 19G9-70 estimates. The fact that such projections now must be made from a lower base will substantially substan-tially reduce expected revenues re-venues during the coming year. In addition to projecting project-ing from a lower base, the foundation study notes that revenue growth during dur-ing recent months has been at a much slower rate than was the case a year ago. If these trends should continue, combined general fund and unifurm school revenues for 11)70-71 11)70-71 could be $.")-$ 10 million or more below earlier official offi-cial estimates. Foundation analysts emphasize em-phasize that the official budget revenue estimates were made at a time of relatively re-latively high economic activity ac-tivity sparked by a persistent persis-tent inflation. With the recent economic slowdown and failing revenue collections, collec-tions, Utah is faced with the prospects of (1) trimming trim-ming expenditures by reducing re-ducing allocations to state agencies such as was done in 19G7 and 19GS andor (2) increasing revenues by raising the state property prop-erty tax levy above the 7.2 mill levy contemplated in the budget. One bright spot noted in the analysis is that interest inter-est earnings in 19G9-70 were substantially higher than anticipated because of an increase in interest yields on state investments. invest-ments. A surge in the unpredictable un-predictable inheritance tax and greater than expected liquor monopoly profits also al-so contributed to a fairly bright general fund picture. pic-ture. The most serious financial fi-nancial problem, according accord-ing to the Foundation re- port, is in the uniform school fund which concluded con-cluded the 19G9-70 fiscal year !?2.5 million under the estimates made at the time of the 197 Legisla-tu Legisla-tu re. |