Gov. Jon Huntsman Jr. may not have plans for any tax cuts next year, but his fellow Republicans in the Legislature sure do.
After meeting for three hours behind closed doors, Senate Republicans were united Tuesday on the need to give Utahns property tax relief. The morning caucus was primarily focused on Huntsman's proposed $11.7 billion budget, announced Monday, that includes no tax cuts.
"We are serious about dealing with property taxes because we have felt the pain from constituents and from our own property tax bills," Senate President John Valentine, R-Orem, said of the majority party members.
Valentine said there's no agreement on how big the cut should be, but some options on the table include reducing the maximum rate school districts can assess and/or taking off the assessment for reading programs and making up the difference with state funds.
Also under consideration are property tax reforms that would, for example, require taxing entities to assess smaller annual increases rather than a single big hike once every few years, Valentine said. Huntsman had told the Deseret Morning News editorial board after releasing his budget on Monday that he wasn't sure lawmakers were serious about finding a way to lower locally assessed property taxes this session. Instead, he'd decided that the state's ever-growing surplus would be better spent on education and other priorities, including improving air quality and getting started on reforming the health-care system.
Tuesday, the governor's spokeswoman, Lisa Roskelley, said Huntsman now "believes they're serious and is interested in working with them on this issue." She said the governor wants to hear a detailed proposal "and we'll go from there."
Just how much lawmakers would slash property taxes and exactly how they could be cut remains to be seen. Some Republican senators, however, said Tuesday they wanted to see a $100 million tax cut.
The House Republican caucus, all 55 strong, won't meet until next week. But Tuesday, House Speaker Greg Curtis, R-Sandy, said, after being informed about the stands of the Senate GOP caucus: "As long as no amount" of tax cut has yet been decided upon "I believe the House (GOP) caucus will go along with a property tax cut."
Later, after more information is found out about state revenues and surpluses, the tax cut can be formalized.
"There is a great deal of angst on the property tax," said Curtis, mainly because a number of homeowners are feeling pinched after significant property tax hikes this year stemming from rising property values. (Taxes were due the end of November.)
Cutting any other state taxes "just doesn't make much sense," considering that new personal income and sales tax rates take effect Jan. 1, reflecting the $220 million tax cut given by the 2007 Legislature, said Curtis.
Other budget issues discussed by the Senate GOP included earmarking money specifically for boosting teacher salaries rather than just increasing the amount allocated to school districts as Huntsman has proposed, Valentine said, similar to what lawmakers did last session.
Republican senators also want to pay down more of the state's bonding debt than does the governor, the Senate president said. Like Huntsman, the GOP senators do not want the state to issue any new bonds in the budget year that begins July 1, 2008.
As for the governor's plan to set aside $30 million as a "down payment" on a yet-to-be released health-care reform initiative, Valentine said there were "a lot of questions raised on it and a lot of concerns about some of the elements that are in the proposal."Although the governor set a 2010 deadline for implementing the reforms, which would likely include some type of mandated health insurance, Valentine said senators have "a lot of work to do on health care before we get close to any kind of agreement."