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Show State ends year with surpluses, and tax cuts When the 1990 Utah Legislature convened on Jan. 8 to tackle the myriad of problems facing the state, it had the benefit of a dramatically improved financial outlook. This was the opinion of Utah Foundation, Founda-tion, the private tax research organization, and is discussed in its annual analysis of state budget prospects pro-spects for the coming year. Not only was the state able to meet all of its legislative obligations during the past two years, but it also was able to conclude each of these years with sizable surpluses and still provide for significant tax cuts. By contrast, Utah was forced to raise taxes in 1981, 1982, 1983, 1984 and 1987 and make across-the-board appropriation cuts in 1986-87, 1985-86. 1982-83, 1980-81 1980-81 and 1979-80 in order to maintain a balanced budget in those years. The foundation report points out that Utah concluded the 1988-89 fiscal year with a combined general fund-uniform school fund surplus of $70.6 million. An additional $70.2 million in surplus funds is expected to develop during the 1989-90 fiscal year. The governor has recommended that this $140.8 million in surplus funds be appropriated for one-time items in 1989-90. He suggested, however, that the state continue to retain approximately $48 million in its budget reserve account (rainy-day (rainy-day fund) to meet future emergen cies. The 1989 Utah Legislature passed pass-ed legislation which limits state spending increases to changes in the population and the inflation rate. The constitutionality of this law has been challenged in the courts by the Utah Education Association. The governor favors retaining the law, but he recommended a one-year one-year override so that the available surpluses can be appropriated for education and other one-time needs. On Dec. 12, 1989, Governor Bangerter submitted a state operating budget of $2,829,941,400 for the 1990-91 fiscal year. This represented an increase of $160.4 million, or 6.0 percent above the amount authorized for the current (1989-90) fiscal year. The proposed operating budget will allow a 6 percent salary and fringe fr-inge benefit increase for teachers and state employees. If revenues exceed current estimates when new revenue projections are made in February, the salary adjustment could be even greater. In addition to the regular operating budget, the governor also recommended $295.3 million for capital outlay, $61.6 million for debt service, and $4.1 million for a retirement tax substitute. Thus, the total state budget for 1990-91, as suggested by the governor, is $3,190,888,700, or $109.4 million more than the total authorizations in 1989-90. It also was suggested that Utah bond for an additional $60 million to finance various building projects throughout the state. Foundation analysts point out that education will receive the largest portion of the new funding under the 1 990-9 1 govemer's budget Altogether, the governor recommended $164 million of added add-ed funds for education in Utah-$117 Utah-$117 million more for public education edu-cation and $47 million more for higher education. If it is approved, this would be the largest funding increase for education ed-ucation in Utah ' s history. The budget calls for total educational expenditures of $1,549 million in 199091$lf149 million for public education and $400 million for higher education. In return for this more generous funding package, the governor has asked for added educational reforms. He wants greater accountability accoun-tability by schools and school districts and more power and responsibility vested with local school authorities. |