Leaders may raid the Rainy Day fund

State legislative Republicans, switching an earlier position, now want to dip into the state's Rainy Day fund for $3.9 million to balance the bleeding budget this year.

Leaders cut millions of dollars from budgets Thursday afternoon in an effort to make up an estimated $202 million revenue shortfall, and final budget tweaking will take place Monday, when the Legislature formally starts its 2002 general session.

But legal concerns may keep GOP lawmakers from using the fund, House Speaker Marty Stephens said today.

Using the $120 million savings account is the main sticking point between GOP Gov. Mike Leavitt and Democratic lawmakers. Leavitt suggested spending $67 million from the fund; Democrats wanted $30 million; and Republicans before Thursday didn't want to touch emergency reserves.

By Monday GOP leaders will know whether they can tap the fund like they want or have to find the $3.9 million someplace else, said Stephens, R-Farr West. "In the whole budget it is a small amount, and we'll get it" for public and higher education one way or another, he said.

House Majority Leader Kevin Garn, R-Layton, explained the Republicans' switch in thinking: "Last year (following state law) $3.9 million in surplus went into the (Rainy Day) fund. But in a time of dropping revenues, we really don't think we should add to the Rainy Day fund when we don't have enough revenues" to cover state agency spending. Last March, Leavitt saw state revenues begin to turn south. And he ordered that a number of state buildings not be constructed. That saved some cash, and the state ended with a surplus when the fiscal year ended June 30. By law, a percent — $3.9 million in this case — of that surplus went into the fund. But that amount shouldn't be considered surplus, said Garn and Stephens, since it wouldn't have gone to the fund if Leavitt hadn't trimmed budgets.

Thursday, both the House and Senate GOP caucuses, in closed meetings, voted to tap the fund for that $3.9 million. "We'd only take the amount that went in in July," said Stephens. " And since it makes little sense to put money into the account when we're having financial difficulties, you may see an effort to avoid putting any more in" at the end of the current fiscal year, he added.