Talk turns to restoring food sales tax

The legislative session has just begun, but there's already talk about restoring the state's share of sales tax on food, even though Gov. Jon Huntsman Jr. said this is the year to eliminate it once and for all.

Also raised Tuesday was the suggestion that state agencies consider asking their employees to take an unpaid furlough or a salary cut to help make up the $1 billion budget shortfall.

While legislative leaders are saying it's too soon to say exactly what will be needed to balance next year's budget — they've only just come to agreement on the cuts necessary for the current budget year that ends June 30 — plenty of ideas are being discussed.

"There's a disconnect in the public in terms of the services they want and the fact that we have to have revenue to provide them," Sen. Pete Knudsen, R-Brigham City, said. "When we did cuts on the sales tax on food, what we did was cut the revenue stream on programs they want. Frankly, the cuts should be put back."

Lawmakers cut all but 1.75 percent of the state's share of sales tax in recent sessions. Huntsman recently called for an increase in the cigarette tax to $3 a pack to remove the rest of the tax and fund some health-care programs.

But GOP senators have little interest in that plan. Knudsen said with the number of smokers declining, the proposal doesn't make senses. "The sales tax on food is a steady, reliable source of revenue," he said.

Senate Budget Chairman Lyle Hillyard, R-Logan, agreed. Hillyard said he never supported taking the sales tax off food "because I knew the impact" on the state funds available for programs like health and human services.

Hillyard said he likes the idea of asking — but not requiring — state agencies to make employees take unpaid furloughs and pay cuts. He said the Bridgerland Applied Technical Center in Logan had taken a voluntary 3 percent pay cut.

"It would be unfair if we were to ask public employees to carry the whole amount with that," Hillyard said. "But it's part of the solution."

Senate President Michael Waddoups, R-Taylorsville, cautioned that it's still early in the budget process. "We're looking for internal savings," he said. "We'll get to a point where we say, 'This hurts too much' or 'This need is not being met.' Then we'll look" at tax increases or asking for furloughs and pay cuts.

Waddoups said he liked removing sales tax from food because he "felt it was helping a lot of people on the low end of the income scale that needed to be helped."

Budget cuts for the current fiscal year ending June 30 have been set by both the GOP House and Senate leaders, with the approval of their caucuses. Hillyard said the plan is is to have the budget ready for a vote in the House and Senate on Friday.

Leaders met Tuesday morning to finalize the work.

House Majority Leader Kevin Garn, R-Layton, said they had asked the governor for his "comments" on certain parts of trimming an extra $175 million from state agencies and the courts.

"The train is moving. We want to button up the '09 budget so we can start on next year's," said Garn. "The governor needs to get on the train."

Huntsman spokeswoman Lisa Roskelley said the governor is "actively involved" in working with legislative leaders on the current-year budget cuts.

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