From Deseret News archives:

2006 Legislature: Finished — for now

Nerves fray in scramble to wrap up

Published: Thursday, March 2, 2006 9:12 a.m. MST
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Perhaps the issue with the greatest long-term affects will be the reworking of the state personal income tax. While debated for more than nine months, Huntsman and his allies had to pull out all the stops trying to get the bill approved by the House late Wednesday.

Senate President John Valentine, R-Orem, made a rare appearance in the House GOP caucus Wednesday at noon to defend the Senate Republicans' decision to support Huntsman's flatter tax, which would lower the current 7 percent top rate to a single rate of 4.975 percent for all.

"If we don't do this (on Wednesday) we've lost the capacity to do tax reform," said Valentine, "because we won't have these kind of (large) revenues next year."

All personal and business income taxes go to public and higher education.

And in future years, with growing enrollments, "no one wants to take it from school kids," the Senate president said.

Most legislators from both parties said that, overall, citizens were well served — record tax cuts given, but also healthy spending increases awarded in a number of state programs.

Huntsman, who publicly flexed his political muscle over the last 45 days, declined to meet with reporters until after his "flatter" income tax had a final vote.

Even with the income tax stalemate, House and Senate leaders said much was achieved.

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Plucking on item out of the air, Curtis said the new research/business initiative for the University of Utah and Utah State University (USTAR) "will make a big difference" in economic development for the state down the road.

Some of the major actions:

  • Cut the state's portion of the sales tax on unprepared food by 2 percentage points, a $70 million tax cut for all Utahns.

  • Debated a new state personal income tax system, lowering the top rate from 7 percent to 4.975 percent for all Utahns. Fewer exemptions and deductions under the new plan, but credits still given for children, charitable giving and home mortgage interest. Earlier estimates put that at a $70 million tax cut. But when the official fiscal note came down Wednesday night, economists said it would be a $65 million tax cut for 2007, its first year in effect.

  • Passed half a dozen "targeted" tax cuts for Utah businesses, all aimed at economic development.

  • Passed a record 2006-2007 state budget of $9.5 billion, the first time state spending will go over $9 billion.

  • Required abortion providers to get permission from minor clients' parents before a legal abortion can be preformed.

  • Ear-marked current sales taxes coming from automobile-related purchases to go for road construction.

  • Spent an additional $200 million on a variety of transportation needs.

  • Gave state workers 3.5 percent pay hikes.

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Sen. Allen Christensen plays with his 16-month-old grandaughter, Rebecca, as the lawmakers rush to wrap up the 2006 legislative session.

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