No tax cuts — or hikes — likely this session

After several tough budget years, Utah state government's tax collections should be on the rise this coming year.

And that's good news for state employees, teachers, students and so on.

And with the return of better times, it will likely be budgeting as usual when lawmakers convene for their annual general session in two weeks.

By that I mean legislators will grumble about how much the governor wants to spend, hold lengthy hearings in nine separate appropriation subcommittees — warning state bosses of dire spending cuts — and then just at the end of the session new revenue estimates will come in and basically bail out the "cuts" that would otherwise have been made.

A lot of pain and suffering, most avoided at the last minute.

Thursday, newly installed Gov. Olene Walker held an economic forecast summit. And while it is one truism that if you put three economists together they would all point in different directions, the general opinion is that Utah's economy is getting better.

A better economy means more taxes paid.

And since Utah state government levies about every tax known to man, as the economy goes up, so does tax revenue.

So far this budget year, the state's two main funds — the General Fund and the Uniform School Fund — together are running just a $20 million surplus. While welcomed, that is nothing compared to the $3 billion-plus revenues going into those funds.

But already House Republicans have voted in caucus not to support Walker's taking of sales tax money from water and roads, and if they don't take that money then it would be tough to meet her demand for a 6.9 percent increase in public education funding for fiscal 2004-05, which starts July 1.

However, like many years before, much of this political intrigue will flow away if late-February revenue estimates for next fiscal year come in higher.

And if Walker's economists who spoke Thursday are to be believed, they will.

"The indicators now are it will be better," said Lynne Ward, a top Walker aide who was Gov. Mike Leavitt's budget director for 11 years. "Tax collections are better, economic activity is up."