Economy rebounding, but legislators playing it safe
Utah's economy is continuing its climb out of the recession, new revenue figures show, but legislative leaders are cautioning that impending budget cuts in Washington make it too early to rejoice.
"Don't go out and celebrate and say we've got tons of money," said Senate budget chairman Lyle Hillyard, R-Logan.
Income, sales and other taxes have come in nearly 11 percent higher than forecast for the first seven months of the fiscal year, according to the most recent figures released this week.
The new revenue figures from the Utah State Tax Commission come days ahead of the Legislature and governor's anticipated release of their new budget forecast for the coming year, which will be the numbers used to build the budget for state programs.
While the robust growth would appear to be a sign of economic health, House Speaker Becky Lockhart, R-Provo, cautioned that the situation in Congress, with $85 billion in automatic budget cuts due to kick on March 1, the Legislature will proceed cautiously.
"It's misleading â¦ because it doesn't take into account any of the other economic factors that are out there," Lockhart said. The big unknown is what steps Congress will take "and how they will impact the [revenue] numbers."
Senate President Wayne Niederhauser, R-Sandy, said he has been in the Legislature in good times and bad.
"I feel more uncertain about forecasts this year than I ever have before just because of what's happening in Washington," he said.
Income tax, which is earmarked to fund education, came in 13.7 percent higher than expected and sales tax revenue was 5.5 percent ahead of forecast figures.
Liquor and cigarette taxes were slightly lower than anticipated and severance taxes from the production of oil gas and other minerals, was 26 percent lower than expected. Gas taxes were also down slightly.
Herbert and the Legislature are planning to release updated budget projections on Feb. 25. Lawmakers hope subcommittees will wrap up their budget recommendations by March 8 so the full budget can be put together by the time the Legislature adjourns March 14.