Gov. Norm Bangerter, at Saturday's GOP State Convention, formally called for a July 18-19 special legislative session to give back part or all of the state's $100-million revenue surplus this year.
But a new Dan Jones & Associates poll taken for the Deseret News and KSL-TV shows that most Utahns, 54 percent, want the state to keep the money, spending it on education or putting it in the bank,rather than return it to taxpayers.
In addressing GOP delegates, Bangerter said the surplus should be returned this year. He didn't say if the refunds should come before the Nov. 8 election.
He also promised a permanent reduction in state income tax rates to deal with the problem of ongoing revenue surpluses.
In his poll, taken May 31-June 1, Jones found that 38 percent of those questioned want the surplus kept for public education and 16 percent want it kept in state treasuries for future needs (4 percent for keeping it), while 18 percent want a cash refund before the election and 14 percent want a credit on their 1988 income tax returns (2 percent for giving it back to taxpayers). Twelve percent want to do something other than the above options with the money, and 2 percent don't know.
Jones also asked what should be done to guarantee that surpluses don't occur in 1988 and beyond.
Thirty-one percent agree with Bangerter and want the income tax rate cut, 23 percent said state tax revenue should be trimmed by restoring the deduction for federal income tax paid on the state return, 22 percent want the sales tax rate lowered, 4 percent want a deduction on state income taxes for Social Security tax paid, 1 percent want a deduction on state income taxes for sales tax paid, 8 percent want to do something else and 10 percent don't know.
Bangerter had been getting some pressure not to call a special session at all, but aides said the governor decided to proceed with the session because he wants to keep a promise made that the money will be returned.
Utahns mostly agree with the calling of a special session to deal with the surplus; 59 percent said it should be handled in such a session, while 30 percent preferred no session.
House Majority Leader Nolan Karras, R-Roy, said legislators will probably give some of the surplus back and keep some of it.
"We said we'd give back any income tax surplus. That is about $75 million. But we also have about $25 million extra in state sales tax. We set the sales tax rate, estimating what it would bring in. The sales tax fluctuates up and down depending on the economy. To keep the $25 million in sales tax only makes up for what we lost in sales tax last year." That $25 million could go to schools, prisons or other one-time needs, he said.
Democratic House and Senate leaders don't want a special session. They want to return the income tax surplus through legislation approved at February's general session - a credit on 1988 taxes.
But Republicans point out that the current refund law would only lower the top bracket of the income tax - 7.75 percent for anybody making more than $7,500 a year. "We could have the case where the top rate is lowered to below the next rate, giving well-to-do Utahns a tax cut and not low-income Utahns," said Reed Searle, Bangerter's chief of staff. A special session could change that law.