Utah Legislature: Education takes a small hit in final budget

SALT LAKE CITY — Republican legislative leaders and GOP Gov. Gary Herbert settled their final budget issues Tuesday, and public education will take a small reduction next fiscal year.

House Republicans originally didn't want the largest segment of state spending — public schools — to take any cuts.

And Herbert didn't, either.

But Republican senators were adamant that schools should at least take a small hit, considering that they have more or less been held harmless this year and next, while some other state agencies and programs have been cut 10 percent to 15 percent.

The initial deal worked out Tuesday called for a 1 percent cut or $21.1 million. But $6.3 million that was to be cut from public school transportation — the buses that take kids to school and to special activities — will be restored.

Money to cover the cost of adding the busing back in the budget is expected to come from the tobacco tax increase initially opposed by Herbert.

GOP House members talked about taking the $6.3 million from tobacco settlement money that comes into the state each year. In fiscal 2010-11, that tobacco money is around $17 million, GOP leaders said.

But the $1-per-pack increase in the cigarette tax already approved by both the House and the Senate would take effect May 1, two months before the new budget year begins.

That means the tax increase, expected to raise $44 million annually, would add more than $7 million to state coffers in May and June. While the governor had threatened to veto the tax, Monday's deal all but ensures he'll sign the bill.

So Herbert actually takes budget hits in two areas — he didn't want an increase in the cigarette tax and he didn't want public education cut.

Now, both of those items will be included in the 2010-11 budget bills that will be passed before the Legislature adjourns at midnight Thursday.

"It looks like we have an agreement on the budget that has addressed the governor's key issues," Herbert's chief of staff, Jason Perry, said. "It has been great to see how well the House, Senate and the governor's office have been working together to meet the needs of the state."

Herbert is expected to announce his support for the tax increase on cigarettes when lawmakers finalize the public education budget Wednesday.

GOP legislative leaders were relieved to have resolved the only remaining major issue left this session.

"We're done," House Speaker Dave Clark, R-Santa Clara, said after leaving a meeting with the governor and Senate leadership. "The governor has signed off."

Senate President Michael Waddoups, R-Taylorsville, said the mood in the meeting with Herbert was upbeat. "We congratulated each other," the Senate president said.