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Gov. Herbert pitches budget to House GOP caucus

Published: Sunday, Feb. 6 2011 9:40 p.m. MST

SALT LAKE CITY — Gov. Gary Herbert pitched his budget to House Republicans Thursday, the day after lawmakers approved a base budget with 7 percent cuts the governor doesn't think are needed.

"There's probably more than one way to skin a cat," the Republican governor said during a generally agreeable half-hour exchange with members of the House GOP caucus.

Herbert said the economy is growing and money is available to fund student growth in public school and cover increased Medicaid costs — all without budget cuts.

"We are recognized as a lean government," he said, calling for maintaining the current levels of funding throughout state government in the new budget year that begins July 1. "This year, I'm saying do more with the same."

Republican lawmakers, who hold the majority in both the House and the Senate, disagree with the governor over how to deal with the so-called $313 million structural imbalance in the new budget.

The imbalance is a result of the state no longer being able to rely on federal stimulus funds and other one-time sources of money to fill revenue gaps left as a result of the downturned economy. Lawmakers say the budget must be cut now that the money is no longer available.

But Herbert's $11.9 billion budget counts largely on continued revenue growth to solve the imbalance problem over the next year or two. Revenue is already expected to be up $215 million, the first increase in some time.

The governor also wants the state to switch income tax collections for the self-employed from annually to quarterly, which would mean an additional $130 million would be collected in the coming year.

Rep. Steve Handy, R-Layton, told the governor there was no appetite among lawmakers for the tax-collection change because it "felt like a tax increase."

Herbert defended the proposal as good tax policy, since the change would put Utah tax collections in line with most of the rest of the nation and the federal government.

But Rep. Fred Cox, R-West Valley, an architect, said it affects the self-employed. "It takes money out of my business now," he said. "If we can solve the budget without it, that's great."

The budget cuts were a bigger issue with the caucus.

"You're saying we're fine, we don't have to take any cuts," said Rep. Todd Kiser, R-Sandy, the chairman of a budget subcommittee. "I don't know how we get there without making cuts."

The governor said it can be done.

"We believe our numbers are legitimate and we can make it work," Herbert said. "The math is the math. I don't want to do fuzzy math. I want to do real math."

Rep. Jim Nielson, R-Bountiful, said the governor's use of more one-time money from the tax change just "kicks the can down the road" and postpones eliminating the structural imbalance.

Herbert told the caucus that it's not prudent to wipe out the imbalance all at once. The final budget won't be set until after new revenue estimates expected in late February are released.

The meeting ended with a quick discussion of another battle — the Super Bowl. While no vote was taken, the loudest support was for the Pittsburgh Steelers, led by former Pennsylvanian, House Majority Whip Greg Hughes, R-Draper.

e-mail: lisa@desnews.com; averzello@desnews.com

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