Utah's 2003-04 budget surplus hits $53 million

Utah's surplus for the budget year that ended June 30 hit nearly $53 million, the governor's office reported Wednesday. Lawmakers will be able to spend the money on one-time projects.

The state had actually counted on receiving an additional $110 million or so in revenues beyond what was budgeted. But once state budget officials made year-end accounting adjustments to that number, it had shrunk to $93.6 million.

Still, that's more than what is available to spend because state law requires a chunk of surplus funds to go into so-called "rainy-day funds" set up for the general fund and the uniform school fund.

And a share of the surplus has to go to the Industrial Assistance Fund, used for economic development, as well as toward bond payments. Add up all those obligations, and the actual surplus drops to $52.8 million.

"This should not be a disappointment to anybody," Senate Majority Whip John Valentine, R-Orem, said after hearing the amount of surplus funds on the table. "That's about what I was expecting."

Valentine said restoring the rainy-day funds is just good financial planning.

"It helps us on our bond ratings," he said. "It gives us better control of our cash. It gives us a pad in case of weak revenues."

Richard Ellis, director of the governor's office of planning and budget, said lawmakers are still paying back money they drained from their rainy-day cash supply several years ago. He said this year's surplus is a "sign that hopefully we may be seeing the economy recover."

The surplus is split between the general fund and the uniform school fund. Education gets $36 million, leaving just $16.8 million to boost any other area of the budget. Not surprisingly, there are already proposals for much of the money.

Lawmakers are expected to meet in special session later this month to consider giving Utah soldiers serving overseas an exemption from paying state income tax on their military earnings.

The $5.5 million price tag for the soldiers' exemption would come from the uniform school fund surplus, since all of the state's income tax collections go into that fund to pay for education. Other special-session items include up to $1.5 million to pay for security improvements to state prison facilities located at the Point of the Mountain. Lawmakers may also be asked to come up with money to protect the archeological finds in the Book Cliff's Range Creek.