State runs surplus of $75M to $125M

The state of Utah is running a tax surplus of between $75 million and $125 million in its main accounts this fiscal year, a first-of-its-kind quarterly revenue report shows.

The revenue update comes nearly a year after the Utah State Tax Commission stopped making its monthly tax-revenue surplus estimates as part of its TC23 tax collection reports.

The new report, given to legislative leaders during their Executive Appropriations Committee meeting Tuesday afternoon on Capitol Hill, is the first of what will become quarterly state tax-revenue updates.

However, state budgeters asked the committee if instead of making a tax revenue update for May 15 and Sept. 15, that they be allowed to do it in June and October.

They said their estimates could be more accurate with the June date, but it also means that the public won't know how state tax collections are matching up with spending from mid-February — when lawmakers get a revenue update as part of their budget-setting process — to mid-June.

Earlier estimates made by a former Tax Commission economist at the request of the Deseret Morning News showed tax surpluses in the 2006-07 fiscal year, which ends June 30, at more than $400 million. But lawmakers spent much of the anticipated surplus when they reopened this budget during the 2007 Legislature in February.

Legislative economist Andrea Wilko said Wednesday she would have a "really, really good" updated report in June, where she will be able to take into account new wage and employment numbers.

Wilko's report shows that Utah's economy remains strong, better than the U.S. economy in major indicators.

For 2007, wage growth is up 8.1 percent, nonagricultural employment is up 3.9 percent, taxable retail sales are up 7.5 percent and population is up 2.6 percent.

While residential building permits may be down 8.8 percent, commercial building permits are up 13.3 percent over the year before. Downtown Salt Lake City, especially, is undergoing a huge building boom, with billions of dollars in new construction just starting.

The Tax Commission's TC23 report was released Monday, and it shows continued growth in the state's major taxes. The corporate income tax is up 25.5 percent.

While that is an amazing increase, that tax source has proven volatile in the past. In down times, that tax greatly drops.

Income tax collections are up 6.1 percent. But Wilko said all the income-tax receipts for April have not been totaled yet and won't be known until later this month.

House budget chairman Rep. Ron Bigelow, R-West Valley, said the new quarterly reports should provide "consistent" reports on ongoing state tax surpluses, something all of the leaders desired.

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E-mail: bbjr@desnews.com