Lawmakers' penny-pinching prudent

Members of the Utah Legislature are charged to make difficult decisions regardless of the circumstances. The recently concluded 2009 legislative session was among the more challenging, given the rocky economy and an accompanying downturn in tax revenues. All state budgets were slashed, assuming a 12 percent drop in revenues, although lawmakers worked very hard to spare public education.

The good news, if one can view it that way, is that revenues have dropped by only 9 percent for the first nine months of the current fiscal year. If this trend holds, state employees may not be subject to further layoffs or unpaid furloughs. Nor would there be need for a special session to trim the current year's budget due to revenue losses.

This suggests lawmakers made prudent budgetary choices. And as much as some lawmakers have bellyached about the federal stimulus package, they have to acknowledge that it provides them some breathing room, financially speaking.

Still, many programs and individuals face painful cuts. Economic trends suggest that the state will continue to face financial difficulties. Some cuts were backfilled with one-time money, which will present added challenges in the coming year.

Yet, lawmakers left themselves some options. Tobacco taxes could be increased, which would have the added benefit of discouraging youths from taking up the habit or forcing smokers to cut down or quit the smoking habit.

Lawmakers could also tap the state's $414 million Rainy Day Funds, which they left alone this year. Another $100 million set aside for public education several years ago also was not appropriated. The "seed corn," as state lawmakers are wont to call it, was untouched.

That's smart because top economists are uncertain when economic recovery will begin in earnest. There have been some encouraging signs recently, but Utah's economy tends to lag behind national trends. State lawmakers could, conceivably, face greater challenges in 2010, particularly if there are significantly more job losses than the 32,800 experienced in the past year. Some economists predict Utah's current 5.2 percent unemployment rate could be as high as 8 percent this time next year. State lawmakers, like the rest of us, will watch, wait and worry.

But for now, they can pat themselves on the back for doing a fine job of crafting a smart state financial plan under highly challenging circumstances.