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Show Guest editorial i nJ Former solon opposes proposals k Hy WARREN E. I'UC.II As a Utah Legislator for 22 years (I retired in 1 !)()) and a Utah businessman for 45 years, I am deeply disturbed by the rhetoric I hear from the Tax Coalition of Utah. Their opposition to tax increases passed by the legislature in the 1987 General Session shows some serious misunderstandings misun-derstandings of essential facts. I am particularly par-ticularly troubled by some of the initiatives being proposed to supposedly solve state problems. The proponents of these ideas seem oblivious to two major facts impacting the Utah economy and Utah residents. I would like to discuss these two facts. Fact Number 1: The growth of the Utah economy has slowed considerably in the 1980's. During the 1970's, Utah economy had an annual average employment increase of 4.4 percent. In the 1980's. the Utah economy has grown by only 2.3 percent annually. Though this growth rate is hall of the 1980's, Utah's employment growth rate is still well ahead of the national average annual rate for the 1980's of 1.7 percent. Wages in Utah have also shown slower growth than in the past. This is a result of Utah companies having to compete in a very tough international market. Kennecott is one example of a Utah company having to meet international market prices. I am pleased to see Kennecott back to work. However, it took a $400 million modernization moder-nization project, a major workforce reduction, and employee wage concessions for Kennecott to be competitive with foreign producers. Such economic adjustments have caused a slowdown in the Utah economy. It has also affected state government revenues. State revenues, when adjusted for' inflation and excluding the 4 percent surcharge tax, fell by over million from fiscal year 1985 to 1987. Utah is not alone in this adjustment to the international market. State governments across the nation are struggling with declining revenues. Twenty-three states cut their 1987 fiscal year budgets in order to balance at year end. and :il states raised taxes. ! I'act Number 2: Though we are not alone in the problem of slowing state revenue growth, Utah is unique in our population make-up. It is this issue that makes Utah's situation so different from any other state. Two major groups in our population play the biggest role 'in shaping our stale budget. They are our school-age children, which demands school funding, and our working age population, which has to pay the taxes. Let's comapre these two population groups with the other 50 states. Utah ranks first in the nation in the percent of our population 5-17 years of age, or our school-age school-age population. Providing education for this group takes half of our state revenues. The reverse side of the coin is equally significant. We rank last in the nation in the percent of our population of working age, or ages 18-64. Put very simply, these demographic numbers mean this: For every two school age children the adult population of the nation must support, Utah's adult population must support three. Already Utah is in the paradoxical situation of spending more money on education as a percent of the state budget and as a percent of personal income than almost any other state. At the same time, we spend fewer dollars per pupil than almost any other state. What the leaders of the tax protest movement also fail to realize is how incredulous it is to think that repeal of the tax increases can be done without any real harm to essential services. ser-vices. I have been told that all that needs to be done is "to cut the fat out." I am supportive of creating any efficiencies we can find. But, as the Senate Chairman of the Appropriations Committee for 10 years, I can tell you that the kind of cuts necessary to balance the budget without the tax increase would have been extreme ex-treme indeed. Let me explain. The General Fund and Uniform School Fund Budget for fiscal year 1987 is $1.3 billion. The tax increase for this fund was $121 million or an increase of about 9.2 percent. To cut the budgets by this amount one could take two alternatives: (a) require all three major sectors of state government (state agencies, higher education, public education) to take across the board cuts; or (b) say tha certain agencies are more important im-portant and should be protected, thus requiring the unprotected agencies to take the entire brunt of the cuts. Let's look at both alternatives. Across the Board Cuts - Public education absorbs ab-sorbs about half the budget so it would have to eliminate $62 million. How would they do that? One scenario is the following: eliminate new textbooks - $9 million; educational supplies, library books, periodicals and audio visual materials - $17 million; kindergarten - $29 million; substitute teachers - $6 million; health services - $1 million. Total $62 million. Higher education is about 20 percent of the budget so they would have to cut $2 rr. ' One scenario would be to close Souther:. J State College - $9 million; Snow Me? million; Dixie College - $5 million; it ! . College of Eastern Utah - $5 million. to-,; a scenario could be to eliminate both coe-Y V colleges in Salt Lake and Provo. Either rf -adds to the $24 million. Finally, an add J $34 million would have to be eliminatec J Con( state agencies' budgets. I M Prioritized Cuts - Let's say educate- services, health, corrections and development are areas too important; cuts. If these were all held harmless million cut would have to come from; A fi state government. The problem isttie-, mj state government's budget totals oi million. In other words, it would bene survey eliminate virtually the rest of state F al to balance the budget. That means e ; mk the legislature, elected officials, so - jlen and the following state department ministrative services, tax getting business, labor, agriculture, as mm funding of the departments of na ; minule ces, public safety and transit ; options are simply not reasonabM;; ,mb . coalition discusses the budget nj. nsen: of the issue, their tax repeal pro SatUrc carry little weight with Utahns. J intro As a Utah resident and busing taxes too. One must remember, , i( taxes are payments f"' public sector. The single bigge . state government funds is educaj J J there are so many childre ned ., 1 pressure for adequate undmg yA Those are the simple facts we They are our children. In u . competitive world, it -s e j And ever to give them a quality311 dellci( Finally, it must be remem r 30n age children ultimate y hu Between 1990 and lW , U tthie $ grow by over 10 perce' ' ' , "u Ltion'swill grow by less ft nig, tremendous advantage Utan u other states if it JJ 0ar Onl growing, well-educated la- . nation. The tax increase wasj J5 the future made by a vi s . , courageous bi-partisan I Utah businessman who isF |